This document presents research on implementing RFID technology in the apparel manufacturing supply chain of Posh Apparel, a Bangladeshi exporter. The study finds that RFID could generate a ROI of 685.29% for Posh by reducing pilferage, improving data updating by 49 days, and increasing transparency. Overall, the research demonstrates that RFID is a worthwhile technology for the apparel industry that could drive business growth, technical employment opportunities, and national economic development in Bangladesh.

1. Authors
Asaduzzaman
Md. Saifuddin Khalid (Presenter)
Prof. Dr. M. Abdus Sobhan
Independent University, Bangladesh (IUB)
September 11, 2009

2. “A key to automating everything”
Invented in 1948 by Harry Stockman
Initial application was in World War II by US army
Came into commercial use in 1990s
Basically RFID system composed of a tag containing a
chip, a reader, its antennas and a computer.
RFID tags and readers have to be tuned to the same
frequency to communicate.
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3. Entered the export market of apparels in 1978
Currently 2.9 percent share of Global apparel market
sixth largest exporting country in the USA
fifth largest exporting country in the EU
Contribution to country’s economy.
76% of the country’s total exports
4.5 million employments
10.5% of the country’s GDP
40% of its manufacturing output
Earning US $14.11 billion in export revenues
Registered a growth of 15.87 percent compared to last
year
Targeted growth $16 billion by this year & $25 billion by
2012
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4. RFID provides
persistent, real-time identification with less human intervention
more frequent data collection
greater information capture
RFID solution can generate an additional
2 to 7 per cent increase in revenue
improve handling productivity by 20 to 30 percent
reduce operating expenses by 2 to 5 per cent
reduce days in inventory by 1 to 2 percent
RFID can take apparel manufacturing supply chain
process and the industry to the next level.
Hard economic times encourages companies to spend
on acquiring the latest supply-chain technology for
competitive age
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5. Emphasized on following fields relevant to research
topics.
RFID
Supply Chain of Apparel Manufacture process
Infrastructure for Business Information System
Research highlights business benefit of RFID especially
for Apparel Manufacturing Supply Chain.
Supply chain with RFID technology can be considered as
global network of integrated hubs of suppliers and clients
that create, track and deliver RFID tagged finished
products manufactured from raw materials and semi-
finished parts to multiple destinations from multiple
supply sources.
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6. Literature Review was conducted on outcome of various
researched on followings:
RFID in Apparel Manufacturing
RFID Implementation and its ROI
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7. Primary objective is to forge a link between the technology and
the application scenarios by using the technology to support
business processes in business and industrial environments.
To establish financial feasibility and benefit of adopting RFID
and it’s facilitating IT infrastructure in Apparel Manufacturing
Supply Chain Business process.
To encourage enterprises for adopting IT and RFID by
projecting business case and help them to give away fear of
Information Technology.
To achieve its worthiness by providing supply chain visibility to
Apparel Buyer, Supplier and Manufacturer.
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8. Hypothesis 1:
RFID with IT will increase transparency between parties involve
with Apparel Manufacture and Exporters
Hypothesis 2:
RFID will reduce workload for management team, increase
purchase order from buyer by ensuring clear view of Supply
Chain and Manufacturing pipe line
Assumptions:
Manufacturing processes are optimized and have sufficient
manpower to adopt RFID and Application
Business value is counted by time for information flow and
financial cost associated with adaptation of RFID
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9. Posh Apparel situated at 897-898 Mohakhali,
Dhaka
Export oriented garment factory
Marketing office in Dhaka and Toronto, Canada.
Production capacity of 50,000,000 dozen of T-Shirt per year
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12. 14
Cont’d

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15. 17
Cont’d

16. 18
Cont’d

17. 19
Cont’d

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19. 21
Cont’d

20. Grand Total for Capital Investment
RFID Device……………………………………………………….2,852,500
Server…………………………………………………………………1,375,000
Software…………………………………………………………….1,000,000
Manpower Training..........................................160,000
One time setup cost for connectivity……………………278,000
Grand Total for Capital Investment……5,665,500
(Taka Fifty Six Lacs Sixty Five Thousand and Five
Hundred) Only
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21. Calculation of ROI
n this case to calculate ROI, it is found:
Gain from Investment = Taka. 3,888,150,000
Cost of Investment = Taka. 5,665,500
ROI = (3,888,150,000-5,665,500)/5,665,500
ROI = 685.29
inancial figure for cost savings are self-explanatory
dditionally Posh will save 49 (Forty Nine) days lead time for
ata update
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22. Return on Investment (ROI)
ROI ratio of 685.29 in first year
Pilferage reduced to .124% from 7.53 %.
Database will be updated 49 days earlier compare to previous
Transparency among all parties involved.
RFID for apparel manufacturing supply chain process is a
worthwhile project for Apparel industry.
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23. 25
Technical experts have to come forward to adopt RFID,
prioritizing the most contributing sector of industry.
Manufacturing process of Apparel industry is a well-
practiced process, the research did focused mostly on IT
infrastructure issues of implementing RFID in its process.
Solution will ensure Transparency among all parties
involved.
A Return On Investment (ROI) ratio of 685.29 is achieved
by showing optimum production capacity utilization of Posh
Apparel.
RFID for apparel manufacturing supply chain process is a
motivating solution for Apparel industry.

24. Study demonstrates:
RFID in key sector of business and industry may derive
extraordinary scope for business growth
Scope of work for talented technical expert of the nation.
The research can be motivating to
increase scope for Information Technology deployment
ensure business growth for Apparel Industry
increase scope of employment for Technical experts and work
force
A win-win situation for the entrepreneur and technical
experts resulting economic growth for the nation.
An excellent candidates to save money with RFID.
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