Ideal Applications for RFID in Retail Distribution Centers

In the dozen years since retail goliath Walmart announced a supply chain initiative requiring its top 100 suppliers to tag pallets and cases of goods with radio-frequency identification (RFID) tags, the technology has seen its share of ups and downs.

Once considered as an alternative to laser- and camera-based automatic identification and data capture (AIDC) technologies that capture and read bar codes, the cost of RFID implementation far outweighed the benefits for most retailers.

Establishing a new RFID paradigm was found to be expensive and risky and thus, difficult to justify the return on investment (ROI). In addition, the tags themselves ranged in price from $0.50 to $1.00 (or more) at the time. Meanwhile, bar codes had become ubiquitous throughout the supply chain—as had the scanners that read them. A decade ago, it simply didn’t make financial sense for most retailers to implement RFID.

Today, the situation has changed considerably. More and more retailers are recognizing the benefits of RFID as the technology continues to see significant improvement from the standpoints of performance and economics.