Importance and benefits of RFID tags in industry and logistics

RFID is already in use in multiple industries and for various purposes. The device in your car that lets you zoom by in the fast lane at a tollbooth, while deducting a dollar amount from your account, is an example of RFID technology in everyday use.

RFID technology was the key in getting 100% reliability about where a shipped item is at any given moment and when it got to its destination in real-time. This information is extremely valuable data to a logistics’ company.

As digital technology has advanced, RFID technology has become accessible even to small and medium-sized businesses. For instance, a small area rug business can attach a tag to every carpet in their retail shop and can zoom the scanner over the rugs to get instant and accurate count of their inventory with all sorts of details, including size of the carpet, quality, country of manufacture, and so on. This eliminates the need for physical inventory counts, which are not only expensive but rarely 100% accurate. The same principle applies in a warehouse of a supply chain management company. If their packages are tagged, they can find out in real-time all the details they need to know about any box.


Some of the major benefits which separate RFID from other technologies are-

Increased Accuracy – RFIDs in Logistics have led to efficient processing of information and transfer of goods. Sensors can detect missing or wrong shipments and alerts are raised subsequently.

Fast and Diligent – RFID is able to scan multiple products simultaneously. This is also done without any human intervention making the process diligent. It therefore acts as a responsible regulator of products.

Lower Inventory – Reducing Inventory Losses is one of the primary benefits that RFID provides. It also impedes any product from going out of stock. It makes the system lower in inertia.

Visibility – The traditional models used by logistics providers fail to provide the much-needed visibility. RFID provides end-to-end uninterrupted visibility for its users.

Operating cost improvement – Operating costs are improved drastically through pin-pointed accuracy, visibility in services and faster working. For example, in 2008, RFID project running over 3 years and the project saved funds through RFID.

Some Important Applications RFID adheres to are:

Increasing the inventory efficiency – Inventory accuracy is increased multifold times due to RFID. It gives accurate results of the storage provided. Therefore Inventory loses are reduced.

For making the transportation process smooth – Tags on shipping items are of small size and can be easily used. After their usage they are destroyed and new tags can be placed. This lets the controller know about transportation taking place.

For handling goods in a safe and secure form -Tracking items and increasing security is made easy and flexible with RFID. The storing and networking of information through RFID gives it an extra edge in security purposes. The tags RFID in Logistic scan trigger security alarms if removed.

For packaging in a systematic form – Packaging can be done in an error-free systematic form. The efficient packaging results in cost savings. Thus RFID leads not only to a smooth process but it also leads to reduction in cost loss.

The future, though, belongs to new RFID applications that will be created with the advent of Internet of Things (IoT) and it will be interesting to see what kind of impact RFID can bring when combined with IoT technology. What do you think? Share your thoughts in the comment section below.

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