According to various survey reports, inventory visibility and order fulfillment are two challenges that retail and supply chain businesses need to tackle as soon as possible. Various retail companies are turning to RFID and IoT-based solutions in tandem with AI, ML, and predictive analysis to gather accurate data on supply chain bottlenecks and the tracking of shipments. They are tagging each parcel, pallet, and container with RFID labels at warehouses to increase item-level visibility on the inventory floor which is a major issue.
An Avery Dennison report highlights that UPS which is charged with handling approximately 5.7 billion packages (last year alone) is utilizing RFID labels to minimize inaccuracies in parcel handling as even a smaller error rate can be quite costly. Therefore, by leveraging RFID and IoT solutions they have created a smart package smart facility initiative to increase operational visibility and reduce manual errors. Similarly, the US retail giant Walmart is using RFID across its hundreds of stores in the USA to tag supplier packages with RFID to ensure quick and accurate inventory replenishment and increase item-level visibility in their stores. In September 2022, it mandated all of its suppliers in the home, electronics, furniture, toys, and gadgets segment to use RFID labels for better accuracy and inventory control.
Let’s see how RFID solutions are transforming parcel identification and shipment tracking at warehouses and distribution centers in detail.
RFID at Distribution Centers
RFID utilizes electromagnetic fields and radio frequency signals to automatically identify and track tags attached to objects, enabling real-time data collection and improved operational efficiency. It is cost-effective and quite efficient solution in modern track and trace applications. As businesses strive for enhanced visibility and control over their logistics processes, RFID-based solutions have proven invaluable in warehouse management, asset management, and inventory solutions.
RFID-based inventory management and asset tracking solutions are increasingly used in distribution centers of the retail, supply chain, and logistics businesses, and by integrating RFID technology, these distribution centers can automate data collection, minimize manual errors, and streamline operations.
From Warehouse to Delivery: Shipment Tracking with RFID
RFID technology extends its benefits beyond warehouse management to the entire supply chain, including the delivery process. Warehouse managers can equip delivery vehicles with RFID readers and integrate them into logistics management systems, to enhance visibility throughout the distribution process.
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a. Enhanced Traceability with RFID
RFID allows for the tracking of products/parcels from the warehouse to the end customer, providing transparency and accountability at every stage of the supply chain.
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b. Streamlined Returns Management
The RFID-based solution facilitates efficient returns processing as well by quickly identifying products and their original locations, improving reverse logistics operations.
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c. Improved Customer Communication and Customer Experience
Real-time tracking data can be shared with customers, enhancing their experience by providing accurate delivery updates and reducing uncertainty.
Applications of RFID Solutions in Distribution Centers
RFID technology finds many great applications in warehousing and supply chain businesses. RFID solutions such as warehouse management system, asset management system, and inventory management systems are used across distribution centers to streamline entire operations and facilitate automation at distribution centers.
1. RFID Warehouse Management Solutions
RFID also significantly enhances warehouse management by automating inventory tracking and improving the accuracy of stock levels. Traditional inventory management relies heavily on manual counting and barcode scanning, which can be time-consuming and error-prone. RFID systems allow for bulk reading of multiple tagged parcels simultaneously, facilitating real-time inventory updates and reducing the time spent on stock taking.
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a. Increased Accuracy in Warehouses
RFID warehouse solutions can reduce inventory discrepancies by providing real-time visibility into stock levels, leading to fewer stockouts and overstock situations.
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b. Enhanced Productivity with RFID Tracking
Automated tracking minimizes the need for manual labor in warehouses, allowing employees to focus on value-added tasks and increasing overall productivity.
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c. Improved Space Utilization
With precise inventory data, warehouses can optimize storage layouts and enhance space utilization.
2. RFID Asset Management Solutions for Distribution Centers
In distribution centers, managing assets such as equipment, tools, containers, RTIs, and pallets is critical for operational efficiency. RFID solutions enable organizations to track the location and status of assets throughout the facility. With RFID asset management systems, companies can monitor equipment usage, maintenance schedules, and loss prevention.
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a. Real-Time Tracking of Assets
RFID tags provide immediate access to asset locations, reducing the time spent searching for misplaced items.
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b. Asset Lifecycle Management
Organizations can track the lifecycle of assets, facilitating timely maintenance and replacements, ultimately reducing downtime.
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c. Cost Savings with RFID Asset Management
Enhanced visibility into asset utilization leads to informed decision-making regarding purchases and resource allocation.
3. RFID Inventory Solutions
RFID inventory solutions enable firms to maintain accurate stock levels and streamline order fulfillment processes. Integrating RFID with inventory management software allows distribution centers to automate reordering processes and optimize stock levels based on real-time data.
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a. Faster Order Fulfillment
With accurate and up-to-date inventory information, distribution centers can fulfill orders more quickly and accurately, reducing lead times and improving customer satisfaction.
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b. Data-Driven Insights with RFID
RFID inventory management systems generate valuable data analytics that can inform inventory forecasting, demand planning, and strategic decision-making.
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c. Reduced Shrinkage in the Inventory
RFID inventory management system provides an accurate picture of the inventory stock levels and helps minimize shrinkage, which is a major issue in retail stores and warehouses. Thus, businesses can monitor their inventories in real time and mitigate losses due to theft, damage, or misplacement.
To summarize, the use of RFID-based solutions in distribution centers represents a significant advancement in supply chain management. When it comes to inventory operations, RFID technology delivers substantial benefits, including increased accuracy, improved productivity, and cost savings removing operational bottlenecks. Going forward, the integration of RFID technology will play a pivotal role in shaping the future of distribution processes, ensuring that goods move seamlessly from warehouse to delivery.
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