RFID Applications in Supply Chain Management - Vizinex RFID
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RFID Applications in Supply Chain Management

There are as many RFID applications as there are businesses.  Some RFID applications have been around for decades, others are just starting to emerge. RFID, itself, is not a new technology; however, it is being used in many new and different ways. The roots of RFID technology can be traced back to World War II when radio waves were used to identify friendly aircrafts, in the 1970s New York Port Authority introduced an RFID device used for toll collection.  While RFID applications used earlier are still around today, many more RFID applications have emerged since then.

Today, the largest RFID application aids companies and governments in supply chain management. RFID is being used to manage products through production, distribution and retail. Manufacturers can especially benefit from implementing RFID applications in supply chains because they can decrease costs associated with product tracking and inventory management and increase the accuracy and timeliness of inventory data. Experts say that early adaptors of RFID applications in supply chains have seen a significant increase in revenue.

RFID Applications in the Distribution Chain

RFID Applications can be used to monitor and manage the movement of the finished products throughout a supply chain.  RFDI tags can be attached directly to the items and materials or they can be attached to the containers that carry them.  Pallets, trailers, totes, carts, cargo containers, and reusable transport items can all be tagged. Readers placed throughout a facility can monitor movement and location of inventory, thus providing real time data.  This can be within a warehouse, a freight yard or within a retail location.

RFID applications in the supply chain enable more frequent and accurate inventory counts  RFID applications in the supply chain can also decrease costs associated with inventory counting

In addition, RFID applications in fleet management have demonstrated significant ROI.  RFID applications in fleet management enable a more cost-effective long-range tracking solution, global tracking of containers and cargo, reliable tracking of capital and inventory assets during transportation and increased security. By placing RFID tags on long range vehicles, trailers or other mobile assets, companies can gain visibility into their business’ assets’ utilization.

RFID Applications in Retail and Product Marketing

As in the distribution chain, RFID application in retail can greatly aid in reducing the cost of keeping accurate inventory data.  With fewer people and less time, retailers can keep accurate inventories.  Associates can spend more time providing service to customers rather than counting product.

RFID Applications in retail can greatly aid in ensuring proper product mix and availability are maintained for customers.  The accuracy of the real time inventory data that is provided by RFID applications, enables product marketing managers to ensure that hot selling items are properly stocked and to ensure replenishment order for these items are placed as quickly as possible.  Slow moving items can be quickly identified.  This allows product marketing managers to take corrective action to goose demand through promotional or advertising activity before a ‘fire sale’ is needed.  Thus RFID applications help product marketing managers maintain their margins.

RFID applications are, also, a significant aid in deterring theft in retail environments.  Items tagged with RFID devices can trigger alarms when they are removed from the store without being properly deactivated.  RFID applications have been successfully deployed for anti-theft purposes for several decades.

RFID Applications in Brand Protection

RFID applications can be used to protect brand identity by product marketing managers and to protect consumers from counterfeited products. RFID applications in anti-counterfeiting are, generally, aimed at high-value end consumer products.    The unique identification number on standard RFID tags can be used to verify the authenticity of the products to which they are attached.  These unique numbers combined with encryption algorithms can create authentication schemes that are extremely difficult for counterfeiters to circumvent.

RFID applications in anti-counterfeiting can be used in many industries, including pharmaceuticals, electronics, entertainment, retail, IT and many more. It is estimated that counterfeiting costs legitimate companies nearly $600B worldwide each year.  The payback even modestly successful anti-counterfeiting efforts can be very high.  RFID applications represent one of the most promising methods for countering this major problem.

By placing RFID tags on products at the point of manufacture, manufacturers can trace products throughout the supply chain. The pharmaceutical industry is creating an RFID application that will document the authenticity of their products at retail.  Not only will the products have a unique ID, but information about the chain of custody for the product will be stored on the RFID tag or in an associated database.   If the product is not properly tagged or the tag is not associated with the proper chain of custody – then you know the product is counterfeit.

While many anti-counterfeiting efforts are a large expense that most US companies face, RFID applications in anti-counterfeiting have a high ROI. By placing RFID tags on products at the point of manufacture, not only can products be traced throughout the supply chain, but it can also prevent counterfeit products from entering into the supply chain.

Conclusion

RFID application in the supply chain offer solutions when it is impractical to use other technologies or manual labor to collect data. RFID applications have many benefits; RFID applications can help in asset tracking, inventory and product management and provide solutions for anti-counterfeiting. Data collected to accomplish all these goals can provide suppliers and end users with the tools and information to make management decisions on the fly resulting in a better ROI.

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