Supply chains and warehouses are the engines that drive any brand’s success. The proper optimization and updating of the supply chain with the latest upgrades is essential for any brand. A well-set process through design, planning, production, and distribution can lend significant gains for any organization. The first step towards an RFID-based supply chain is evaluating the brand’s existing supply chain to identify room for improvement. Once the scope for improvement is identified, manufacturers can focus on leveraging technology to make necessary improvements.
Former supply chains and room for improvement
In general, supply chains consist of several different parts of the process from design, planning, production, distribution, and retail sales. Without the use of technology each of these processes requires detailed attention and consumes significant time. Higher lead time is one of the most painful challenges for any supply chain as the manufacturer has to rely on demand forecasting and manufacture products in advance to benefit from demand surge. Sometimes brands have to manufacture products before a few months or even longer timeline. Such an approach of manufacturing in advance requires risky investment and demand forecasting can often be imprecise.
However, such an approach of manufacturing in advance to manage sales trends can result in overwhelming stock for the warehouses, this surplus stocks generate inventory management challenges and labor costs. Lastly, such a loose and long supply chain can result in a stock of sluggish items that are out of the market trend. These stockpiling forces brands to introduce discounts and offers to sell such products anyhow. Therefore, decreasing profit margins for the company or even resulting in a loss after such advanced investment. This plethora of challenges can be addressed with the help of RFID.
How RFID can impact traditional supply chains?
RFID can allow brands to keep track of all their offerings including their sales performance across the globe. Furthermore, if a product carries a unique identifier through the entire supply chain, then the brand can track the product through each phase of the production. This overview of the complete system can allow manufacturers to find any loose ends and mitigate them instantly. In addition to the complete cycle, RFID can create a great value for inventory management and warehouse automation.
As a result, RFID can ensure that the right products are being manufactured in required quantities within a suitable lead time. Such practices result in better sales performance and productivity for the brand. Therefore, RFID can ensure that brands do not need to suffer from loss or less profit due to overwhelming stock.
RFID fits into the supply chain application quite perfectly, it explains why RFID has been so popular lately for smart packaging or connected packaging as well. A single RFID tag can allow brands complete control over their supply chains while also allowing them a handful of other advantages such as brand identity and user experience. Therefore, the implementation of RFID tags can offer a massive return on their investment through every part of the production cycle, helping brands as well as the customers.