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RFID And Epc Assessment Of Assessment

The combination of EPC and RFID taken together are providing the foundation of value chain efficiency and profitable operation across many industries, with retailing being one of the most rapid adopters (Trunick, 2005). Wal-Mart's pilot in 2004 of its top 100 suppliers further legitimized the use of EPC codes in RFID pilots and discovered that mixed-pallet mode shipping was even more cost-effective than large-scale logistics and supplier enablement (Khanna, 2006). Since 2004 to today, Wal-Mart has continually championed the use of RFID across its global supply chain to reduce inventory carrying costs and also increase the efficiency of its massive distribution centers. While its competitors continue to challenge its pricing strategies and programs, Wal-Mart continues to dominate the financial metrics of performance that matter most. The legacy of Wal-Mart's expertise in analytics and the ability to quickly parse trends out of complex data sets also made the integrated of RFID data easier to accomplish than many of its competitors as well (Krishnamurthi, 2001). Due to all of these factors and the rapid integration of RFID as a core technology for automating and bringing greater clarity to the value chains of enterprises, analysts predict that the $233 million spent in 2006 will grow to $874 million by 2011 (Trebilcock, 2007). An additional aspect of RFID implementation today is the pervasive benefits occurring for manufacturers, logistics providers and retailers. Table 1, RFID Benefits for Supply Chain Partners provides an overview of the many contributions RFID is making within enterprises with specific focus on...

those who have distribution- and logistics-centric business models.
Table 1: RFID Benefits for Supply Chain Partners

Manufacturers

Logistics Providers

Retailers

Shorter shipment loading times

More efficient order selection and order fulfillment

Better store planning, programming and merchandising with real-time data

Greater shipment accuracy

Better order fill rates

Improved Point-of-Sales productivity and accuracy at checkout

Better consumer sales data from retailers

Less inventory shrinkage due to more efficient inventory tracking

More accurate returns

Reducing the level of counterfeiting of products and diversion throughout channels

Fewer administrative and other human errors caused by mislabeling products

Improved reverse logistics

Improved support for Vendor Managed Inventory (VMI)

Lower labor requirements

Greater inventory accuracy and velocity

Easier product safety recalls

Less vendor fraud and higher levels of vendor auditing

Optimized store in-stock levels

More accurate demand planning

More accurate inventory

Reduced internal and external shrinkage

Shorter order lead times

Less time and lower cost for managing inventory

Lower labor requirements

Less need for safety stock

Higher routing efficiency throughout warehouses and distribution

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