RFID – The new face of Supply Chain Management
A study on use of small but smarter technology to re-invent the retail supply chains. By: Prerna Saini
Supply chain of any industry means integration of the supplier and retailers to provide goods at the right time and in the right place that should satisfy the needs of the customers. Today the supply chain is the backbone of all the retail giants, be it Benetton, Zara, Hennes & Mauritz, Wal-Mart, Big Bazaar, Spencer, Shoppers Stop, etc. But owing to problems like stock-outs, lost sales, delayed shipments, production slowdowns, excess buffer inventory, shrinkage and billing delays, etc. the management seems to be missing from supply chain management(SCM). What comes to the rescue of SCM is Radio frequency identification (RFID), a term describing technologies that use radio frequencies to identify objects. This is the latest technology that is making headlines in the Supply Chain network. Though it has been in existence since 1970’s but it is only now that it has starting changing the way people look at supply chain, owing to companies who have introduced cheaper ways of producing RFID tags, Readers, Tags, Portals and accessories. Wal-Mart is the first company to incorporate RFID in its supply chain and requires its suppliers also to use RFID. This technology has helped Wal-Mart in several functions like tracking inventory, locating various goods, collecting payment, which in turn has helped speed up the movement of goods in the warehouse and reduce cost of labour and errors in every possible way. RFID has helped Wal-Mart save up to $8.35 billion annually. It has helped it in its aim to coordinate with its suppliers to serve its customers more effectively. But RFID does not come to the rescue of supply chains without a cost. A lot of planning and testing has to be done before implementing RFID in any organisation successfully. The information encoding has to be standardised to help RFID technology...
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