RFID can offer superior benefits to conventional identification systems such as barcode. RFID can potentially automate and improve the checkout process, thus minimize the number of cashiers and reduce long check out queues in supermarket shopping. Although there are quite a few research works and pilot studies on RFID applications to the upstream supply chain or limited items in retail, the item-level application of RFID in supermarkets has not been implemented on a large scale so far due to its cost and performance issues. In this research, we identify the problems and propose effective solutions with RFID deployment for Point-of-Sale (POS) checkouts at supermarkets. To develop an effective and efficient system, we discuss cost and performance issues related to RFID. We propose solutions to these problems based on surveys on products and design and analysis of experiments to find the best tagging methods and system design which ensure high performance and low cost. The process analysis performed by simulation identifies the potential impact of the proposed system design on POS checkout process.