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Should You Use RFID Technology in Supply Chain Management?

by zeeh
RFID Technology

RFID Technology: Efficient supply chain control is now needed in the space in which we live. Businesses always seek strategies to increase supply chain visibility, accuracy, and efficiency. Technology and radio-frequency identity, or RFID, have become powerful instruments for engaging in these objectives. However, is RFID in the supply chain acceptable for your enterprise? Let’s explore the world of RFID technology to help you decide. We will discuss its advantages, drawbacks, and key components.

How Does RFID Function in Supply Chains and What Does It Mean?

RFID tracks and identifies devices via radio waves. Pallets, goods, and containers are tagged using tiny microchips and antennae. These tags include information on the goods, location, and surroundings. RFID readers can then wirelessly retrieve the stored records through their interaction with the tags, which involves the emission of radio waves. This makes it possible to sell commodities regularly and in real-time as they pass through the supply chain. 

Features of RFID Application for Supply Chain Management

Enhanced Visibility: You can always locate your inventory exactly, from raw materials used in production to the last goods on shop shelves. This removes the need for human inspections and offers insightful information on the movement of your supply chain.

Better Inventory Management: RFID automates data collection, simplifying inventory management. Using precise real-time data, you may limit shrinkage (loss of inventory), optimize stock levels, and lessen the occurrence of stockouts and overstocking. RFID also makes cycle counting more efficient, saving money and effort.

Enhanced Efficiency: Using RFID to automate processes results in a significant increase in efficiency. An efficient delivery chain is facilitated through shorter order success lead times, quicker cycle counts, and much less time spent searching out misplaced goods.

Decreased Errors: Manual data entry is one of the main causes of mistakes in conventional delivery chains. By putting off the need for guide scanning, RFID reduces human blunders and ensures data correctness. As a result, there are fewer recalls, incorrect orders, and lost shipments.

Enhanced Security: RFID tags effectively deter theft and counterfeiting as they’ll be programmed with precise IDs. Moreover, actual-time tracking allows for spotting illegal entry to commodities, improving delivery chain protection.

Simplified Logistics: RFID simplifies monitoring and managing goods at some transportation points. Real-time cargo tracking allows to reduce delays and guarantee on-time delivery. RFID additionally quickens the customs clearance method via automating sharing.

Challenges and Considerations for Implementing RFID in Supply Chain

Cost: The initial outlay for RFID technology, which incorporates software programs, readers, and tags, may be tremendous. Even though there can be greater long-term benefits than premature prices, comparing the return on funding (ROI) before adoption is critical.

Integration: It may be important to make additional software and infrastructure investments to integrate RFID with present-day structures. Smooth integration is needed to get the most out of RFID in your supply chain.

View the Range Restrictions: The read variety of RFID tags can range depending on the kind of tag and reader used. This needs to be considered during implementation to ensure effective tracking throughout your supply chain.

Metal Interference: Metals can interfere with RFID signal transmission. Look into specific RFID tags made to address this problem if your supply chain includes metal containers or storage facilities.

Standardization: Standardizing RFID tags and protocols throughout the supply chain might be difficult. For data exchange to be simple, distributors and suppliers who utilize compatible RFID systems must work together.

Who in the Supply Chain Can RFID Help the Most?

RFID has advantages for all industries, however, it’s beneficial for companies that cope with the following:

High-value items: Using RFID to monitor and prevent the robbery of luxurious things such as electronics, prescription drugs, or luxurious goods can enhance safety.

Complex delivery chains: Businesses can use RFID to attain real-time visibility and optimize operations in complicated supply chains regarding several stages and stakeholders.

Perishable items: RFID makes it viable to monitor temperature fluctuations and different environmental factors when storing and transporting perishable goods, including food and medicines, ensuring their high quality and safety.

High-extent stock management: Businesses with large and fluctuating inventories can notably increase productivity and accuracy via RFID to automate data gathering.

Making the Decision: Is RFID Right for Your Supply Chain?

Here are some key inquiries to ask yourself before you decide:

How a great deal of money do you have to put RFID into exercise?

Sift through the possible return on investment against the initial costs of tags, readers, software, and integration to see if it fits within your budget.

To what extent is your supply chain complicated?

The benefits of RFID in terms of enhanced visibility and streamlined operations increase with the complexity of your supply chain.

Which types of gadgets do you oversee? 

Products with excessive stock turnover, high-cost commodities, or perishables can most advantage from RFID’s advanced efficiency, fine control, and protection.


RFID can improve visibility, efficiency, and accuracy at some point in your delivery chain. If you cautiously weigh the benefits, difficulties, and important variables, you can decide if RFID is the best option for your organization. RFID may completely alternate how your delivery chain operates and offer you a competitive edge in a trendy, rapid-paced marketplace, provided you havt a nicely-concept-out implementation plan and integrate it successfully.

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