Radio Frequency Identification (RFID) has proven its ability to increase efficiency in supply chain visibility for manufacturers and distributors in a diverse range of industries. Here are just a few ways RFID can help your business’ efficiency:

  • Tightens inventory control
  • Eliminates manual track and trace
  • Reduces warehouse theft

As great as RFID can be for your business, however, the cost to deploy the technology can lead to some hesitation when making purchase decisions. The question becomes: “how can I/we justify the expense?” The answer is simple, RFID saves time and money by reducing man-hours and increasing productivity. The technology eliminates many mistakes that can chip away at your profitability. Little things can create gaps in your supply chain and waste time and money (for example, are warehouse employees spending time looking for lost inventory or tracking down mis-picks and mis-ships?). If 30 minutes per day are wasted per employee and you have 100 employees, that’s 50 wasted man-hours per day. If the average warehouse pay is $15 per hour, you are paying $750 per day and getting absolutely nothing in return.

How much is outdated technology costing you in lost inventory and replaced shipments? How much are lost or delayed shipments costing you in customer satisfaction? If you lose two customers per week, what is the lifetime value of that customer?

Consider all these factors and then assign a cash value to each. If you add it up and project it to annual losses, you will see how RFID can deliver greater ROI. For more information, call Data Gear for a free analysis of your supply chain system.

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