RFID for Better Supply‐Chain Management through Enhanced Information Visibility

Mostly fueled by mandates, adoption, and implementation of the RFID, technology in the retail industry is growing rapidly. At these early stages of adoption, one puzzling issue for retailers and suppliers is the compelling business case for RFID. In order to explore the potential business case for RFID, we conducted a case study using actual RFID data collected by a major retailer for the cases shipped by one of its major suppliers. We show the physical layout of the RFID readers on a partial supply‐chain covering product movement from distribution centers to retail stores. First, in the analysis phase, we identify several performance metrics that can be computed from the RFID readings. Next, using this RFID data, we compute the values of those performance metrics. These values represent mean time between movements at different locations. Then, we discuss how these measures can assist in improving logistical performance at a micro supply chain level of operations between a distribution center and a retail store. We present how such information can be valuable to both the retail store operator and the supplier. We also discuss the initial lessons learned from actual RFID data collected in the field, in terms of data quality issues.