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RFID Inventory Management
RFID is transforming inventory management by enabling smarter tracking and control of stock. With real-time data, improved accuracy, and streamlined operations, this technology is revolutionizing how warehouses and retailers manage inventory. Let’s dive into RFID tags and how they can enhance your inventory management processes.
What is RFID Inventory Tracking?
RFID utilizes radio waves to automatically identify and track tags attached to objects, such as inventory items. In inventory management, it serves as a modern alternative to barcode scanning, enabling businesses to monitor products in real-time without manual intervention.
An RFID management system consists of RFID tags, readers, and software. Each item is tagged with an RFID chip and readers placed around the warehouse capture data as items move through. This creates a highly accurate and automated system that improves inventory tracking, reduces errors and saves time.
How does RFID work?
RFID has proven to be a game-changer when it comes to inventory management. Contrasting with barcodes where scanning is a manual process, RFID offers unparalleled cost savings through automation.
Item gets RFID tag which identifies what the unique item is. RFID scanners are placed in strategic locations around the warehouse where key inventory steps need to take place. The RFID tags allow thousands of items to be rapidly scanned automatically. The tracking of goods as they move in and out of the warehouse can now be automated allowing for accurate inventory updates.
How do RFID Tags work for inventory management?
RFID tags are small electronic devices with an antenna that are attached to items that can be interrogated from a distance using RF waves. The tags are often encoded with information such as product codes and serial numbers that allow the tags to be instantly identified. Properly encoding RFID tags for inventory control allows for a decoupling of software systems between entities such as manufacturers, warehouses, distributors, and retailers.
RFID Tracking and Inventory Tracking
With RFID tracking, businesses can keep a real-time pulse on their inventory. As items move past RFID readers, their locations are automatically recorded, enabling warehouses to manage stock levels, streamline storage, and enhance security. By automating this process, companies can boost efficiency, eliminate the need for manual counts, and significantly reduce errors.
RFID Tags
RFID tags come in various types, each designed for specific applications. They store and transmit data using radio frequency signals, allowing for seamless tracking and identification of inventory, assets, or personnel. The right tag selection depends on factors such as range, durability, and environmental conditions.
RFID Tag Costs
The cost of RFID tags varies based on their type, materials, and functionality. Simple, passive RFID tags can cost just a few cents each, while more advanced active tags with long-range capabilities and built-in sensors may cost several dollars. Bulk purchasing and application-specific requirements also influence pricing.​
Types of Tags
RFID tags come in several forms, including paper-based inlays, hard tags, and specialty tags designed for harsh environments. Some are optimized for short-range scanning in retail, while others are built for industrial applications, such as tracking equipment or monitoring temperature-sensitive goods. RFID stickers for inventory tend to be a popular choice as they are both inexpensive offer good range.
Active vs Passive
RFID tags are classified as either active or passive. Active tags have a built-in battery, allowing them to transmit signals over long distances, making them ideal for large-scale asset tracking. Passive tags, on the other hand, do not have a power source and rely on the RFID reader’s signal for activation. They are more cost-effective and commonly used in supply chain and retail applications.
Advantages
RFID technology offers numerous benefits across various industries by enhancing tracking, efficiency, and cost-effectiveness. It reduces human error, streamlines operations, and provides real-time insights into inventory and asset movement.
Increased Accuracy
RFID minimizes errors associated with manual data entry and barcode scanning by automatically capturing tag information with high precision. This leads to more reliable inventory records and fewer discrepancies.
Improved Efficiency
By automating tracking and identification, RFID speeds up processes such as inventory counts, order fulfillment, and asset management. This reduces bottlenecks and enhances overall workflow.
Real-Time Data Tracking
RFID enables businesses to monitor inventory and assets in real time, providing up-to-the-minute data on location and movement. This enhances decision-making and reduces instances of lost or misplaced items.
Lower Operational Costs
By improving inventory management and reducing shrinkage, RFID helps businesses cut costs associated with overstocking, lost items, and inefficient workflows. The technology also minimizes the need for manual audits.
Improved Visibility and Faster Scanning
Unlike barcode scanning, which requires a direct line of sight, RFID can capture multiple tags at once, significantly speeding up data collection. This leads to better visibility of stock levels and asset locations.
Reduced Labor Costs
With RFID automating many tracking and data entry tasks, businesses require fewer personnel for inventory management. This allows staff to focus on higher-value activities, leading to overall cost savings.
Returnables
Warehouses often grapple with complex movement of items such as product returns. These scenarios allow for extra steps that can introduce errors. RFID is particularly beneficial as it ensures better accountability, reduces losses, and optimizes the circulation of returnable items within the supply chain.
Challenges
Implementing RFID for an inventory management system requires a significant upfront investment in infrastructure, including hardware, software, and system integration.
Scanner Costs
Providing automation through RFID requires hardware investments wherever RFID items need to be interrogated. This means a fixed scanner or mobile scanner when appropriate. Fixed scanners cost in the range of $1,200 to $3,000 per scanner. Mobile scanners tend to be more expensive and cost in the range of $2,000 to $4,000.
Infrastructure Costs
Each reader needs to have both power and networking enabled in order to work with any software system. This typically involves using a POE (power of ethernet) connection which allows networking and power to be combined. You still need to have a drop for every fixed scanner in the warehouse. A warehouse scaling out its RFID deployment must carefully consider the time and money requirements for running all of the additional cabling and coordinating with IT on networking requirements.
RFID Tag Costs
You will need to consider the cost of tagging existing inventory assets. will you only tag new inventory that comes in or also existing? If existing, will you use internal staff for tagging inventory or hire an external integrator? Passive sticker tags typically cost from 5 cents to 15 cents. Multiply out by all inventoried assets to get a ballpark figure on tag cost.
Integration Requirements
An RFID inventory system must work seamlessly with enterprise resource planning (ERP), warehouse management systems (WMS), and other inventory tracking software. Achieving smooth integration may require specialized middleware or APIs, adding to the overall cost and complexity of adoption. If not executed properly, compatibility issues can arise, affecting inventory visibility and operational efficiency.
The RFID Inventory Managment Workflow
Assets are RFID tagged by manufacturer. Companies often use GS1 standard for encoding. Advantage is that every tag that is read has all of the information needed to identify what the item is as well as a unique serial number. No need for an internal database record for every item.
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Once shipment arrives at warehouse, receiving rapidly scans each box as they are removed from the truck. The data is transmitted to Warehouse Management System to update inventory counts.
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RFID scanners also allow for rapid product discovery. No more endless searching for missing boxes of assets in the warehouse.
RFID scanners can fully scan all inventory leaving the warehouse and automatically update inventory counts as well as reconsolidate with 3rd party systems such as Warehouse Management System.