Retailers Look To RFID Technology For Tracking Merchandise

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: Have you ever wondered what it would be like if you did not have a name to identify yourself?

And what if no one else had any names either?

You need no elaboration on the rigmarole one would need to go through in such a case to perform even the most mundane transactions of our lives.

Retailers for long have been grappling with a similar issue, the need to give electronic ’identity’ to products and track them as they are transacted across the value chain. Radio Frequency Identification (RFID) is the newest solution on the block (the underlying technology itself is of World War II vintage; but that’s another story!) for retailers requiring an enhanced supply chain visibility, the ability to know exactly where every item in their supply chain is at any moment in time.

RFID falls in the same category of automatic identification systems that include bar codes, smart cards and others. However, the benefits of RFID go beyond being the next generation bar code. A key benefit of RFID technology is automatic identification of individual objects coupled with automatic data capture. This provides the necessary capabilities to address some of the pain points that retailers face in improving overall supply chain visibility and efficiency. Physical tracking of merchandise today is a challenge with significant implications across the supply chain for manufacturers, distributors and retailers. There is a good business case in certain retail segments and product categories for the ability to identify unique products using a technology that doesn’t require significant manual intervention or line of sight.

The most common method of identifying objects using RFID is to store a serial number that identifies a product and perhaps other information on a microchip that is attached to an antenna (the chip and the antenna together are called an RFID transponder or an RFID tag). The antenna enables the chip to transmit the identification information to a reader, which in turn converts the radio waves returned from the RFID tag into a form that can then be passed on to information systems that can make use of it.

Notwithstanding all the hype surrounding the technology, concerns regarding privacy and lack of de-facto standards, RFID does hold a lot of promise and is poised to be the next disruptive technology to rock retailers.