The case for using RFID within logistics and for industry is often cited as compelling. Is this really the case?
What can RFID be used for?
Some of the main arguments for RFID are:
- Process automation
- Lowering transportation errors
- Reducing packaging costs
- Lowering inventory
- Product authentication
Process automation
Adding RFID tags to shipping containers such as pallets, roll cages and plastic boxes can allow automated tracking both within a plant or storage facility or between buildings. Depending on where RFID readers are located and the type of tags used, rather than manually tracking or using manual barcode scanning methods to record, RFID readers and tags do this automatically. This is great for asset tracking in both an open and closed loop environment. So for example RFID enabled forklifts can track pallet movements around a warehouse, into and of reserve and picking storage locations and when passing RFID tags embedded in floor locations around a building. If items in/on a container also need to be tracked this either means adding RFID tags to items being carried at unit level, or linking existing item identifiers such as barcodes to the RFID tag in backend software. If the former is cost effective then great. For many organisations however tag prices have not reduced far enough yet to RFID tag large numbers of assets, products and retail units. Therefore barcode technology is often still required within logistics.
Lowering transportation errors
Not only can RFID tags be applied to different types of shipping container and product/stock, they can also be applied to larger assets such as vehicles. So not only can tracking occur say within a building or between buildings, tracking the loading and unloading of vehicles can also take place. As a vehicle arrives at a delivery dock door its RFID tag can be read. Any subsequent RFID tag movements into or out of the vehicle including the use of motion sensors for example will also track what is being loaded and unloaded. Alarm systems can then notify any errors immediately.
The truth is that whilst this data is very useful it becomes more powerful when combining RFID with GPS and GIS technology. This can further enable real-time visibility of deliveries. Geofencing technology can also alert for movements into and out of geographic territories, at different times of the day or night too. So if a vehicle was driven out of a factory gate outside hours, RFID can activate gate alarms and a GIS system can send text and email alerts. Or GIS can work similarly if say a vehicle deviated outside a geographic territory. Further functionality can send alerts when vehicle doors are opened. All this helps to manage transportation in order to reduce errors and improve security.
Reducing packaging costs
Using returnable containers instead of cardboard is a good example of packaging reduction. Not only can returnable containers be environmentally beneficial it can also improve packaging processes. For example simplifying product packaging in manufacturing and warehousing through to making unpacking processes at retail outlets such as car dealerships, faster. By also employing process automation techniques outlined above RFID has been used by many major companies throughout the world.
Lowering inventory
A key argument here is for manufacturers and distributers to have accurate inventory records. This can include new materials as well as unused items and stock that can be returned from customers because it is unused and no longer required. Note there is potential for customers to faster understand stock that is unused. RFID can certainly help here however it requires careful analysis and understanding on the level that tags are to be applied, then the frequency and visibility of readings across a supply chain. This needs to be aligned to customer orders and returns requests if inventory is to be reduced. This is because without these major components, buffer stocks will continue to be used to safeguard against stock outs. So combining information and technologies can provide significant assistance in inventory planning.
Product authentication
Encrypted product information contained on RFID tags can help customers authenticate products. It can show items that are:
- Counterfeit or fake
- Tampered with
- Substituted
- Appearing in the wrong geographic territory or retail outlet
- Unacceptable e.g. expired, discarded, returned, recalled
Whilst this information is extremely useful the downside to RFID is that it can be hacked. Tags can also be removed and destroyed. So to protect against violent attacks other authentication solutions such as microparticle marking is worth using.