♥ RFID Journals ♥

Monday, May 4, 2009

Week 2 - RFID Case studies

Radio Frequency Identification(RFID) is quite a newly emerging technology which is becoming more popular nowadays though it has already been around in the 50's. RFID tags can also be used in different configurations. Mainly the passive and active tag that can be 'Read-only', 'Write once/read many', and 'Read/Write'.

Pallets being push through to read

RFID technology brings a lot of advantages as compared to barcodes because it can carries a larger amount of data and information with the product when it travels through the supply chain. In one glance, vendors can clearly see the infomation in details and can bring lots of convenience. RFID also provides less errors, thus, it saves time and additional cost. In this way, more profits can be shared out among vendors.

Other advantages includes like having multiple items being read in a single scan rather than reading 1 by 1 which is a waste of time. RFID tag is just like a portable database of information for each tag which stores large information with it. Passive tag have a virtually unlimited lifetime whereas active tags can read from great distance. It has the ability to suvive in harsh conditions. The data on the tag can be modified throughout the life of the product. There is also a unique permanant ID embedded in each tag so that the information are all safe.

Label of the pallet scan being scan

Though of the many advantages, RFID has its disadvantages as well. Each tag actually cost from $0.50 to $250.00! That is quite expensive for just a tag! Which consumer would actually want to pay a $0.50 item double the price because of the RFID tag in it which cost more than the price of an item? Although Passive tag has unlimited lifetime, but it can only read/write at about 4inches to 20feet. RFID is oso currently lacking in standards though it is being addressed rapidly.

Wal-Mart

Now, on to Wal-Mart case study, It is said that Wal-Mart headed down this road because they believed it would save them up to 8 billion dollars!

Wal-Mart says:

$6.7Billion save to eliminate the need of having people to scan barcodes on pallets.

$600Million to reduce the possibility of out-of-stock.

$575Million can be saved due to fewer administrative errors and vendor fraud.

$300Million due to better tracking of the many pallets and cases that move through the distribution centers.

$180Million saved due to the improved visibility of what products are in the supply chain.

Total pre-tax saving: $8.35Billion which is higher than the total revenue of more than half the companies on the Fortune 500.

``*Writing RFID journals in progress*``
7:00 PM