The document discusses the use of RFID technology compared to barcode technology. It notes that RFID tags can be read from greater distances than barcodes and allow for reading multiple tags simultaneously. RFID tags are also more durable and can be read/written to with additional information. The document outlines how retailers are using RFID technology in their supply chains and inventory management. It provides an example of how Mission Foods was able to significantly reduce replacement costs for returnable containers by implementing an RFID tracking system.

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Logistics Management
March 2011

2.  RFID: Radio-frequency Identification. A technology that
utilizes radio waves to transfer data from an electronic
RFID tag, which is attached to an object. The data is
transferred through a reader to allow the object to be
identified and tracked.
 Active RFID tags have batteries and transfers
information at scheduled intervals
 Passive RFID tags may or may not have batteries and
must be within close proximity to a reader to transfer
information

3.  Fixed RFID reader- A reader that reads RFID tags in a
stationary position. E.g. toll booth
 Mobile RFID reader- A reader that is mobile when it
reads RFID tags. E.g., hand held devices, vehicle
mounted readers.

4.  Barcode readers require a direct line of sight to the
printed barcode; RFID readers do not.
 RFID tags can be read at greater distances (300 feet for
RFID vs. 15 for barcode readers)
 RFID readers can read RFID tags much faster (forty or
more tags per second). Barcode readers take much
more time due to direct line of sight limitations- takes a
half second or more to read a barcode.

5.  RFID tags are more rugged and reusable than barcodes.
Printed barcodes must be exposed and are subjected to
wear and tear. The electronic components of the RFID
tag are protected in a plastic cover and are often
implanted in the product.
 Barcodes have no read/write capability. Additional
information cannot be added to the barcode. RFID
readers can communicate with the tag and alter or add
information
 RFID tags are more expensive than barcodes

6.  Wal-Mart issued a mandate in 2003 that all suppliers
should be tagging cases and pallets with RFID tags by
the end of 2006
 Spurred a lot of innovation by the RFID industry-
investments in reader technology, chip technology and
software.

7.  Perception- Proponents of RFID promised unrealistic
results for an unrealistic price
 Functionality- Radio waves were not stable. RFID tags
did not work well around metal or liquids. High failure
rates.
 Price- RFID technology was expensive.

8.  Better tag technology (silicon) that can be read more
accurately and at increased ranges and requiring less
power
 Better reader technology that eliminates false reads;
overcame the environmental limitations of liquids and
metals.
 Price decrease- went from developing a chip to work
with solutions to developing solutions that would work
with existing tags on the market.

9.  Retail Supply Chain is an open loop: Several participants
are out of the retailer’s control, including manufacturers,
distributors and transportation providers. Impossible to
ensure compliance unless every party shares data.
 Retailer’s store is a closed loop: Starts at the retailer’s
distribution center and stops in the storeroom, the shelf
and at the point of sale. Retailer controls each stop and
can ensure compliance.

10.  RFID allows the Retailer to know whether the size, style,
and color it needs to make a sale is on the shelf or in the
back room.
 Retailers putting a fixed RFID reader between the back
room and the sales floor. When the product leaves the
back room the inventory levels are automatically
updated.
 Retailers also audit the shelves with a mobile RFID
reader which enables them to replenish inventory.

11.  Manufacturers are applying RFID technology to keep
track of the manufacturing process. Track process steps
instead of individual items, crates or pallets.
 Tags may be used as a mobile database for
manufacturers. Item reaches a workstation and is
scanned by a reader. The tag tells the operator or
workstation what work needs to be performed.
 Aircraft maintenance organizations use RFID to track the
location of critical tools required for repair operations
can also track whether tools have been inspected or
calibrated
 RFID is also used a resource management tool to keep
track of people working in hazardous environments.

12.  Convergence- the idea that many automatic data capture
technologies work best when they’re used in conjunction
with other complementary technologies.
 RFID can interface with bar codes, senses, WiFI and
GPS. It can
 RFID interfaces with Management Warehouse Solution

13.  Three warehouses process 20,000 containers of product
daily.
 Products are placed in returnable plastic containers
(RPCs) and loaded onto independent distributors’ trucks.
 RPCs rarely were returned to the warehouses. Mission
Foods had no way to track if container was returned to a
different warehouse or at all.
 Nearly 100 percent of RPCs were being replaced each
year at an annual cost of $3.5 million.

14.  Mission Foods implemented an RFID-based asset
management and tracking system.
 RPCs are tagged with RFID labels. RFID reader records
the pallets and associated RPC as the distribution truck
leaves the warehouse. RPCs are processed and
scanned as “returned” as they are returned to the
warehouse.
 Mission Foods is able to see where the RPC is located in
real time
 Replacement budget for RPC rate has decreased to
20% for damaged or unreturned containers; Actual
replacement rate is about 4%