2. contents
3. The impact of RFID on supply chain
1. Background
efficiency
RFID
2.What is RFID? 4.Conclusion
3. Background
Wal-Mart Stores, Inc.
The top 100 suppliers must tag pallets and cases
shipped to three Dallas-area distribution centers
by January 2005.
4. Department of Defense.
Pentagon suppliers must place RFID tags
on cases or pallets shipped to the DoD by
January 2005.
5. Food and Drug Administration.
The organization recommends that all
pharmaceutical producers, wholesalers, and
retailers begin developing plans to place RFID
tags on pallets, cases and unit items by 2007.
11. The impact of RFID
on supply chain efficiency
Bullwhip effect
VMI
( Vendor-Managed Inventory )
12. Vendor-Managed Inventory
store
Inventory
Vendor Levels
Replenishment
Retailer
Distribution center
Monthly or Weekly Cycle
Replenishment
13. Replenishment in a Consumer-Driven
Supply Network
Real-Time inventory and demand information
reported hourly or daily
Daily and Event-Driven
Replenishment
Shelf
Store
consumer
Manufacturer Shelf
consumer
Retailer
Distribution Shelf
Center
Replenishment
consumer
Inventory Inventory
Inventory
Information Information
Information
RFID based Real-Time Inventory and Demand Data
14. More accurate information
• Received at distribution center
• Departed distribution center
• Received at store
• Departed store stock room (arrived at shelf)
• Case (tag) destroyed
15. immediate benefits
• Better control over overage, shortage, and damage
claims management and the ability to better assign
responsibility to the supplier, the carrier, or Wal-Mart
• Better control over product recall
• Data that improves processes through collaboration
between Wal-Mart (retailers) and its suppliers
17. In the long term, retailers and manufacturers
can benefit from the RFID
Retailer benefits
• Reduction in out-of-stock items
• Store and warehouse labor reduction
• Reduced inventory
Manufacturer benefits
• Inventory visibility
• Labor efficiency
• Improved fulfillment
• Improved customer service levels
18. The closed-loop supply chain process
Supply Chain Planning
planning moniter
4. Act
1. Plan 3. Check
2. Do
Execution Systems
Event Management
RFID
19. However
• Replenishment from many resources
The ideal supply chain & pull process chain
The closed-loop supply chain supply
• significant economics of scale in manufacturing
and transportation
20. Conclusion
• Allow real-time tracking of products, or at least
cases and pallets
• Largely reduce lost sales
• Consumer-Driven Supply Network