RFID (Radio Frequency Identification Technologies) has become very popular and is considered as a major advanced in supply chain management. In fact, RFID is the fastest growing segment of the automatic data capture and identification market. RFID is a technique for electronic labeling and identification of objects using radio waves. RFID tags have both a microchip and an antenna. The microchip permits to store object information such as a unique serial number. The antenna allows the microchip to transmit object information to a reader, which transforms the information on the RFID tag to a format understandable by computers. RFID is used in many sectors: passports, transports payments, products tracking, automotive, animal identification and inventory system. RFID deployment in supply chain management is still in its early life. However, it seems to have a strong potential for improving processes and may fundamentally modify the way of supply chain.
[...] Finally, the expedition failure and the theft along the supply chain are limited. For example, in Unilever (Italy), the pallets are identified by RFID named Tiris (sold by Texas Instruments). The fork-lift trucks are equipped with RFID reader and a radio modem connected with the information system. When a fork-lift truck takes a pallet, its tag is automatically read and the data are transferred on the computer. When the fork-lift truck moves in the warehouse, the antenna, placed in strategically area such as doors can identify the new place of the pallets. [...]
[...] Weak markets understanding the benefits Opportunities Threats Could replace the bar codes Ethical threats concerning privacy End-user demand increases life Huge market potential Highly fragmented competitive Need for standardization environment Business application of RFID 1. Wal-Mart: the precursor Wal-Mart, the world's largest retailer and the more advanced in the use of technologies, has invested 15 billion dollars in the RFID technology. Wal- Mart is widely seen as one of the world's top drivers of RFID technology. The company began its RFID involvement when it mandated that its 100 top suppliers start tagging all cases and pallets carrying merchandise by January 2005. [...]
[...] Conclusion The RFID market is planned to soar in the latest year: it will represent 2,8 billions dollars in 2009, against 300 millions in 2004. The RFID technology will improve the entire supply chain management. The biggest retailer such as Wal-Mart, Metro or Tesco have already adopted it despite the criticism of the associations for the consumer protection. However, there are some critical success factors to the implementation of the system. First, RFID implementation should be seen as a way to integrate a range of business processes in the long term, and not an [...]
[...] Moreover, the Japanese Hitachi has developed an RFID chip that requires no external antenna and makes possible the embedding of tracking and identification chips in bank notes, tickets and other paper products. Drawbacks 1. Cost problem The cost of tags remains difficult to justify for now, compared to the cost of bar codes. The cost is between 15 and 25 cents Euros per tag but with commitment of a volume reached several millions of units. The tags are more costly to produce to be implemented in large numbers in mass market products. [...]
[...] - The interfaces with the warehouse management: The RFID has to be associated with the evolution of the information system of the company and also to management modules in order to guarantee a real follow-up of the products in the supply chain. The tracing of each item produce by a company will require the creation and management of a significant database Productivity problem The production of tags is insufficient to respond to US market demand. Alien Technology, a US manufacturer of RFID technology has difficulty to deliver orders in time. [...]
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