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Why RFID Is Going to Be The Next Big Thing In Inventory Management?


RFID is being used in every field these days. RFID school bus tracking system is an example.

It is also being used in commercial sector. Inventory management is one major area, where RFID is going to create a huge impact. That is the main reason it is being mentioned as the next big thing in inventory management.

RFID will benefit inventory management in the following ways:

Continuous inventory monitoring

RFID-tagging of products allows continuous tracking of the location of inventories, real-time. Therefore, when there is shortage of a product in the ware house, an RFID system automatically places the order. As a result, you will not have to face out-of-stock situations.

No human intervention

Usually warehouses scan barcodes to scan their inventory items. This requires manual effort and plenty of time. However, with RFID, warehouses and distribution centres can do it easily. Also, the volume and amount of inventory doesn’t matter. With RFID, there is no need of manual tag reading. As a result, you can save both labour costs and time.

Also, while scanning using barcodes, they have to be positioned upwards. However, using RFID tags does not require placing an item in a particular position to read it.

Accurate information

Sometimes, to know the demand in a supply chain network, it is necessary to get accurate information about the actual sale of items. But, with the traditional tracking methods, there are chances of error in the information. Use of RFID systems can help in tracking real-time and accurate information on sales. This can then be used in decision making.

Reduced lead-time

Lead-time is the total time taken between the actual beginning and completion of a production process. With the traditional tracking processes, you can’t really keep monitoring the items being transported. However, it is possible with RFID systems. It can help you in taking decisions even if there is interruption in supply while managing inventory. As a result, you can reduce lead-time and save money and energy.

Deal with anomalies

With RFID systems, it is possible to monitor items continuously. This can help in preventing theft, misplacement of items etc.

Speeds up sort/pick rate

The sorting/picking activity in warehouses can be time consuming and error-prone. Using RFID systems improves sort/pick rate, by capturing accurate and real-time information about availability of a product. You don’t have to go to a store physically to check the availability of a product.

The entry of RFID systems in inventory management can be a disadvantage for barcodes. But, the following properties of RFID prove that there is nothing wrong if barcodes will be replaced.

  • Tags can read even at a distance of several metres
  • Several tags can be read at a time, enabling the checking of a whole load of products simultaneously
  • Unique identification codes given in tags enable individual tracking of products
  • Some tags can be overwritten. Therefore, information about items can be updated in the tags

In the current scenario, implementation of RFID in inventory management is in the developing phase. Some companies have starting using RFID systems on an experimental basis and so far, the results have been satisfying. This, of course, means that RFID has a future in inventory management.

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