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Impacts of RFID on the supply chain

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  1. Introduction.
  2. Business application of RFID.
    1. Wal-Mart: The precursor.
    2. The European distribution speed up with the example of Metro.
    3. Application in the textile industry.
    4. Application in the pharmaceutical industry.
  3. Advantages.
    1. The data storage is revolutionized.
    2. The product flow is optimized.
    3. Better productivity and improvement of the stock management.
    4. Theft and counterfeiting.
  4. Drawbacks.
    1. Cost problem.
    2. Technological problem.
    3. Productivity problem.
    4. Ethical and social problem.
  5. Conclusion.
  6. Sources.

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. [...]

[...] The data concerning an item, a container or a pallet of the supply chain can be modified during the label life. In fact, if the content or the destination of a product has to change, there is no need to make a new label, it just has to reprogram the chip. This system will be a good solution for the identification of the luggage in airport The product flow is optimized Since January 2005, a new regulation has been implemented concerned the traceability of foods. [...]

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