How RFID technology solutions are transforming global supply chains
Getting products from where they are made and into the hands of consumers is a complex undertaking. Global sourcing and supply, transportation and logistics, and sophisticated omni-channel retail operations have added cost and complexity in the face of increasing customer demands and competition.
Technology has proven to be an invaluable tool to help speed up supply chains and provide manufacturers, distributors, retailers and even customers with the real-time information they need to make better decisions.
RFID is an established technology that has increased in sophistication since it was introduced. With the cost of implementing an RFID solution steadily decreasing, it provides one important piece in the puzzle to create more efficient global supply chains.
What is RFID technology?
RFID stands for Radio Frequency Identification and is a form of wireless communication. It uses radio waves to identify a wide variety of ‘tagged’ objects (and even people) from a distance. Unlike traditional barcodes, RFID does not need a direct line of site to ‘see’ RFID tags on objects. This is a game changer and key to saving time and increasing accuracy in supply chains.
How does RFID technology work?
RFID technology solutions use a combination of RFID tags, RFID readers, software and networks to create a customised solution to track a wide range of valuable business assets. There are many different types of tags and readers used as part of an RFID technology solution.
RFID tracking for stock and inventory
Global supply chains are moving faster than ever before. Time really is money when it comes to moving products from where they are made to where they are sold. Manufacturers and retailers are looking for any edge, large or small, that means they can meet customer demand quickly and efficiently, and faster than the competition.
That’s where RFID comes in.
Keeping track of stock and inventory can be cumbersome and time-consuming, as well as error-prone. Traditional stock takes literally stop a business in its tracks for manual counting of sometimes many thousands of items. Not only does that take staff away from more productive tasks, but it is error-prone and rarely accurate.
The ability of RFID technology solutions to count to item, carton or pallet level, with a wide field of view, increases accuracy and occurs in real-time as stock moves between identified points. Entire rooms of inventory can be scanned in minutes without requiring close proximity or direct line of sight to RFID tags.
From warehouses to ports to distribution centres to stores, RFID provides instant information on location and stock counts without any manual intervention.
What are the benefits of using RFID technology to manage inventory?
RFID technology solutions are established and proven in tracking valuable stock and inventory across the entire supply chain. The major benefits are:
- Accurate inventory tracking to item level – RFID Journal estimated that average inventory accuracy increases from 65% to 95% with RFID technology
- Streamline warehouse processes – less manual counting and human intervention means stock can move in and out of warehouses fast
- Reduce out-of-stocks by as much as 50% – RFID technology helps increase sales and keep customers satisfied (and spending!)
- Hold less safety stock – knowing exactly how much stock is on hand, and where it is at any time helps reduce the drain on working capital of holding stock as a buffer
- Reduce shrinkage – slash shrinkage and stock loss by more than 50% to save replacement costs and eliminate the need for time-consuming audits
Any item, any channel
The rise of e-commerce sales and omni-channel strategies has added complexity for retailers. Successfully managing retail store sales, online sales and ‘click & collect’ relies on access to accurate information in real-time.
Knowing where products are, and moving them quickly to where they need to be (or might need to be soon) is enabled by RFID tracking solutions deployed across the entire supply chain from manufacturing to warehouse to (real or virtual) store.
How BAKU swimwear keeps track of up to 20,000 SKUs
Iconic Australian swimwear brand BAKU needed a new way to manage a complex range of styles, prints, colourways and sizes that made up over 20,000 SKUs in the system at any time. The goal was to reduce out-of-stocks and maximise sales across retail and online channels.
BAKU implemented a customised RFID technology solution that delivered real-time, accurate knowledge of all products across the entire supply chain and allowed rapid expansion of its omni-channel strategy.
The implementation of RFID technology by BAKU resulted in faster stocktakes, rapid replenishment of fast-moving items from local manufacturing, increased inventory accuracy and reduced staff time counting and tracking thousands of items of stock.
How RFID technology informs better business decisions
Beyond the obvious benefits of RFID technology outlined above including increased inventory accuracy, less manual processes and reduced errors, it is the availability of real-time data to inform better business decisions that has the potential to revolutionise supply chain management.
With customised software and information provided by easy-to-use dashboards, retailers can make better business decisions faster than ever before. Watching stock move in and out of retail and virtual stores means that products can be moved to where they are likely to be needed before it’s too late.
And as popular items move quickly from warehouses and out the door into the hands of customers, production can be ramped up immediately to meet unanticipated demand so sales are not lost, and customers remain satisfied.
Just-in-time production also frees up valuable working capital to be deployed in more productive ways such as marketing and technology investment, not sitting idle in excess stock holdings.
RFID technology solutions promise all this and more, and are helping transform global supply chain management right now.
When you need to improve inventory management, speed up your supply chain and gain valuable, real-time insights to make better business decisions you need to talk to RAMP, the leading RFID specialists in Australia.