Advantages of RFID in Logistics


Asset management

RFID tags can be permanently attached to capital equipment and fixed assets – everything from pallets to tools, vehicles, trailers and equipment. Fixed-position readers placed at strategic points within a facility can automatically track the movement and location of tagged assets with incredibly high percentages of accuracy. This information can be used to quickly locate expensive tools or equipment when workers need them, eliminating labor-wasting manual searches. Readers can be set to alert supervisors or sound alarms if there is an attempt to remove tagged items from an authorized area.

By tracking pallets, totes and other containers with RFID and by building a record of what is stored in the container as items are loaded, users can have full visibility into inventory levels and locations. Manufacturers, for example, can easily locate items necessary to fill orders and fulfill rush orders without incurring undue managerial or labor time.

RFID tags or labels on pallets, cylinders, RPCs (reusable plastic containers) and other shipping containers can be automatically read at the dock door as they leave with an outgoing shipment. By matching the reading with specific shipment information in a database, manufacturers can automatically build a record of what specific shipping containers were sent to each customer, information that then can be used to document cycle times, improve returns and recoveries and aid in disputes with customers about lost or damaged assets.

Production Tracking

Studies found that manufacturers can reduce working capital requirements by 2 percent to 8 because of the greater visibility RFID provides into work-in-process tracking and materials inventory. By applying RFID tags to subassemblies in a production process rather than to finished goods, manufacturers can gain accurate, real-time visibility into work-in-process in environments where bar codes are unusable.

Inventory Control

Improved inventory tracking remains RFID’s primary benefit, especially when the technology’s capabilities are used to collect information and provide visibility in environments in which tracking was not done before. Because RFID tags can be read through packaging without direct line of sight between object and reader, and because they can withstand exposure to dirt, heat, moisture and contaminants that make bar codes unusable, RFID can remove blind spots from inventory and supply chain operations.

By using the highly accurate, real-time and unattended monitoring capability of RFID to track raw materials, work-in-process and finished goods inventory, companies can improve overall inventory levels and reduce labor costs and safety stocks. Readers covering warehouse racks, shelves and other storage locations can automatically record the removal of items and update inventory records. If an item is misplaced or needed urgently to complete an order, fixed-position readers or a worker with a mobile computer and RFID reader can automatically search for the item by reading for its specific ID number.

Process Control

Besides protecting inventory from theft and diversion, readers can be set to sound alarms or send notification if items are placed in unauthorized areas of the facility or removed from storage without prior approval. Industry studies found consumer goods manufacturers would reduce shrink (inventory loss) by an estimated 10 percent by implementing secure storage areas.

Similarly, direct store delivery and other remote sales and service personnel can take advantage of RFID readers integrated with mobile computers to quickly and accurately count inventory held in stores or in a vehicle. The automated counting saves significant time in the field, allowing representatives to visit more customers in a day. For field service applications, permanent asset tags applied to equipment store its ID, configuration and service history information to ensure accurate and appropriate service is performed in the field, where access to a central records database may be unavailable.

logistics pic

Business optimization 

Many highly effective applications can take advantage of existing data collection systems and processes and enhance them with RFID for operations where more functionality is required. This approach fully leverages existing technology and successful systems, which makes the return on investment for RFID easier to measure and faster to attain. For unit-level identification, bar code systems may provide excellent performance and will continue to be the most cost-effective option. RFID then can complement and expand that system at the carton, case and pallet processing level.

The same benefits retailers and distributors are attaining are available to others that implement RFID-tagged shipments into their own business processes. Manufacturers benefit by applying RFID tags to cases and shipping containers, especially reusable assets like pallets, reusable plastic containers, kegs, totes and gas cylinders. The types of RFID tags that are placed on these items may be reused hundreds of times, which leverages the initial tag cost to provide a very attractive total cost of ownership. Tagging at this level also sets the foundation for numerous highly accurate labor-saving automated routing, receiving, shipping and inventory control applications. These benefits allow manufacturers to reduce fixed assets 1 percent to 5 percent and to cut working capital 2 percent to 8 percent because of better asset utilization,

Advantages of RFID in Retail


RFID Smart Labeling

  • Monitor unattended inventory.
  • Automatic item identification on mixed pallets.
  • “Smart Shelf” systems – designed to provide real time tracking of tagged items on shelves.
  • Shipping and Receiving applications.

Shelf Stocking

  • Real-time notification of out-of –stock items.
  • Improvement of product replenishment.
  • Retention of consumers who may turn to competitors if inventory item is out-of-stock.
  • Automated charting and tracking for improved product forecasting.

Overhead Reduction

  • Track product shipping and receiving from point-to-point automatically versus manual tracking to save time and labor cost.
  • Know how many units of inventory or on-site via automated RFID system versus manual process, saving labor and time cost.
  • Efficiency in error reduction reduces manual labor cost.

Check-out Process

  • Reduce time spent in line.
  • Reduce labor/time cost of employees.
  • Streamline check-out process with ability to scan multiple items and pay for them all at once.

Inventory Shrinkage (Shrink) Reduction

  • Track retail items between point of manufacture or purchase from supplier and point of sale.
  • Real-time notification of security when RFID tagged items leave area without payment.
  • Competitive advantage – saving money on theft allows to offer product at lower prices.

Goodbye barcodes – hello RFID

The RFID device serves the same purpose as a bar code or a magnetic strip on the back of a credit card or ATM card; it provides a unique identifier for that object. And, just as a bar code or magnetic strip must be scanned to get the information, the RFID device must be scanned to retrieve the identifying information.


If it has the same purpose, why use RFID?

A significant advantage of RFID devices over the others mentioned above is that the RFID device does not need to be positioned precisely relative to the scanner. We’re all familiar with the difficulty that store checkout clerks sometimes have in making sure that a barcode can be read. And obviously, credit cards and ATM cards must be swiped through a special reader.

Removing actual physical contact or precise positioning for scanning makes them frictionless for your business.

RFID devices will work within a few feet up to 100 feet for high-frequency devices of the scanner, a major benefit. Typically RFID 15-20 times faster than manual and barcode processes.

What are the advantages of RFID compared to barcode?

Although RFID is more costly than barcode, it proves to be indispensable for a variety of automated applications involving data acquisition and object identification.

No line-of-sight contact necessary
The major advantage of all kinds of RFID system is that they work contactlessly and require no line of sight.

Robust system
Transponders can be read through a whole number of substances, e.g. snow, fog, ice, paint, dirt, and in difficult constructional scenarios where barcodes or other optical reading technologies would be no use at all.

Speed of an RFID system
RFID transponders can be read at remarkable speed even in difficult conditions, and in most cases respond in less than 100 milliseconds.

Bidirectional communication
The reading/writing capability of an active RFID system is also a significant advantage in interactive applications, e.g. when tracking products in process or maintenance jobs.

Reliability in tough environments
In difficult external conditions RFID has the advantage of being able to communicate contactlessly and without direct line-of-sight contact with the data medium. Where the transponder is doesn’t matter either — it can be read through substances like dust, paint or ice.

Bulk detection
Active and passive systems working at HF and UHF frequencies detect a number of transponders in the field. This property is called bulk capability. In practical terms it means that every data medium needn’t be scanned singly, but is automatically detected during a read operation.


RFID Barcode
Line of Site Not required (in most cases) Required
Read Range Passive UHF RFID:
– Up to 40 feet (fixed readers)
– Up to 20 feet (handheld readers)

Active RFID:
– Up to 100’s of feet or more

Several inches up to several feet
Read Rate 10’s, 100’s or 1000’s simultaneously Only one at a time
Identification Can uniquely identify each item/asset tagged. Most barcodes only identify the type of item (UPC Code) but not uniquely.
Read/Write Many RFID tags are Read/Write Read only
Technology RF (Radio Frequency) Optical (Laser)
Interference Like the TSA (Transportation Security Administration), some RFID frequencies don’t like Metal and Liquids. They can interfere with some RF Frequencies. Obstructed barcodes cannot be read (dirt covering barcode, torn barcode, etc.)
Automation Most “fixed” readers don’t require human involvement to collect data (automated) Most barcode scanners require a human to operate (labor intensive)

Book Review: The Best Kept Secrets of Retail Loss Prevention by David W. Netherland

An excellent primer on the loss prevention space from someone who has witnessed it all. In short If you are beginning a small retail business or are running a multi-million dollar organization the concepts David outlines are applicable. This book will provide you with tools to be profitable and gives some basic human resource does and don’t information all based on personal experiences.

The Best Kept Secrets of Retail Loss Prevention - Book Cover

The Best Kept Secrets of Retail Loss Prevention begins with several scenarios of real theft examples. Each theft has a common thread, you could have prevented the theft with customer service. Netherland continues by explaining the benefits of using an aggressive loss prevention / customer program to reduce profit loss.

BRC Retail Crime Survey: Retail theft tops £600m

Retail crime is on the up in the UK with an estimated three million theft incidents burned a £603m hole in the industry’s earnings in the 13/14 financial year. The average value of each in-store theft increasing by as much as 36 per cent to £241 per incident, according to a report from the British Retail Consortium (BRC).


Helen Dickinson, director general of the BRC, said: “Criminal activity against UK retailers continues to have wide-ranging consequences for businesses, employees and the vast majority of honest shoppers. The average cost to retailers of theft has now reached £241 per incident, the highest in a decade. Fraud committed online also continues to rise.


Retailers also reported 58,014 incidents of violence and abuse – 2 incidents of violence and abuse per 1,000 employees. Mark Castle, chief executive of the charity Victim Support, added: “The amount of violent and abusive incidents reported in the retail sector is particularly shocking. Nobody should have to fear for their safety in the work-place.”

Security insights from ASSA ABLOY Future Lab

The ASSA ABLOY Future Lab is an initiative aimed at observing and analyzing the trends and the future of the security arena. In a recent publication they highlight up and coming trends in security.

Technology fuels – and prevents shrinkage

But just as technology has created new challenges in retail loss prevention, it is also providing new opportunities for protection. As thieves become more sophisticated, so too are the tools to stop them.

Mike Jackson is a consultant with Security Research Group, a California-based security and safety management consulting firm. He cites intelligent video surveillance, a form of video analytics that detects movement in live or recorded video, as an example of the new technology.

Intelligent video surveillance systems operate on specifically programmed rules, so, if the video software feels that a customer standing in a particular area for a certain amount of time could constitute a potential theft, it will alert the operator. “Since this technology is independent, it doesn’t require as many people to monitor it so you reduce costs and boost productivity,” says Jackson.

Digital IP cameras, with streaming that can be accessed from anywhere, are also revolutionizing in-store security, while cloud technology is providing more flexible storage of data. Facial recognition cameras are also new tools in the fight against shrinkage. Programs can identify previous shoplifters from a database when they come into view and trigger an alarm. But this is an expensive technology, Jackson adds.

With Silverstar Analytics advanced video analytics and cloud platform, we bring ultra modern tools in a cost effective package to the retail industry.

Vend Unveils The Retail Digest, the Most Comprehensive Site for Retail News and Information

Our partners at Vend have unveiled The Retail Digest, a community news site focused around retail news and information where smart retail minds can meet, trade ideas, and grow. It is designed to fill the information and news void retailers and retail professionals currently face.

The Retail Digest brings together the industry’s top experts to provide the best retail-centric content that they read on the web. It serves as a helpful resource for retailers, experts, retail consultants, and agencies.

The Retail Digest has invited the top 100 industry influencers and experts who write regularly for publications like Retail Wire, National Retail Federation, and Retail TouchPoints. The goal is to keep retailers informed and help continue to improve their stores and keep their businesses thriving.

Returns scammers to cost retailers billions over holiday period

According to the results of a survey released this week by the National Retail Federation, retailers estimate that losses from return fraud will cost them $3.8 billion this holiday season, which is slightly higher than last year’s $3.4 billion. The NRF 2014 Return Fraud Survey, which was completed by loss prevention executives at 60 different retail companies, also found that the industry will lose close to $11 billion overall to return fraud this year alone.


Key findings

  • Retailers polled estimate 5.5 percent of holiday returns are fraudulent.
  • 92.7 percent of the retailers polled say they have experienced the return of stolen merchandise in the last year.
  • Most worrying, more than three-quarters of those surveyed (78.2 percent) also reported that they have experienced return fraud through returns by organized retail crime groups, up from 60.3 percent last year
  • Retailers estimate that 14.1 percent of the returns made throughout the year without a receipt are fraudulent.
  • 81.8 percent of retailers surveyed report that they’ve dealt with employee return fraud or collusion with external sources

refind receipt

Retailers in recent years have had to loosen return policies to ease one of the most frustrating parts of shopping and win customers from rivals, by making it easier to get a return without a receipt and easing conditions. But that left an entry point for crooks. “Return fraud has become an unfortunate trend in retail thanks to thieves taking advantage of retailers’ return policies to benefit from the cash or store credit they don’t deserve,” said NRF Vice President of Loss Prevention Bob Moraca.


Top cloud fears exposed

Stats in the IDG Enterprise Cloud Computing Study 2014, show that cloud investments have increased by 19 per cent in enterprises and that in 2015 cloud will account for almost a quarter (24 per cent) of IT budgets – with the highest percentage going to software-as-a-service (SaaS) models.

Despite this overwhelming momentum there remains some fear that continues to hold some businesses back from taking advantage of the cost, efficiency, flexibility and performance benefits that can be achieved by using the cloud.

Cloud-Access with alpha

Lets focus on the main arguments.

The cloud isn’t stable – what happens to my business when it goes down and is unavailable?

The uptime stats for most cloud service providers would put those of on-premise corporate IT systems to shame. Whilst 100% uptime is unrealistic, four nines (99.99%) is normal with some stretching to five nines (99.999%) which equates to just over 5 mins down time per year).

The cloud isn’t secure and my data is on the internet

This is perhaps the most often used reason to resist using the cloud. Gartner, state: “To date, there have been very few security breaches in the public cloud — most breaches continue to involve on-premises data centre environments. While cloud providers should have to demonstrate their capabilities, once they have done so there is no reason to believe their offerings cannot be secure.”

The cloud is just about saving money

Yes, you can reduce cost by using the cloud. This is by removing upfront and capital costs from your business. No more buying physical hardware – servers, storage, etc. The saving are worthwhile but most businesses more value the flexibility to scale up and down as their business required. By deploying new applications and systems much faster businesses can better respond to rapidly changing business requirements.

why cloud

Is your great customer service exposing your business to fraud? Returns fraud?

In this highly competitive world great customer service is vital to your business. Today’s customers expect a great experience and being treated as a King. Great customer service typically comes down to four key components

  • Don’t Make Your Customers Wait
  • Transaction Transparency
  • Help Them Help You
  • Build Trust and They Will Come (Back)

A central part of this is a retailer’s returns policy. The return—that moment when the customer effectively tells the store that the sales transaction was a failure, that they found something better, or a better price—is a true test of the retailer. When they fail, shoppers feel tricked, and business suffers. Retailers understand this and have responded by opening up their returns policies. But this comes at a risk of opening the door to higher levels of fraud.

refund policy

The National Retail Federation estimates that retailers lost $9.1 billion to return fraud in 2013. The dollar amount of fraud increased almost 3 percent over 2012. In both years, 3.4 percent of returns were thought to be fraudulent.

The most common form of return fraud is the return of stolen merchandise. Other forms of return fraud include employee fraud, return of items bought with a stolen credit card or other fraudulent means of payment, and retail fraud committed by organized crime groups. The return of already used merchandise, called “wardrobing”, was reported by over half of all retailers. This is where the merchandise is purchased for a single event, used and returned.

refind receipt

Our advice to retailers on returns fraud.

  • Correlate a return to a specific transaction. Never take a return not knowing its original origin.
  • Look for correctional between the operator of the return and the original transaction. Repeated matches indicate collusion.
  • Insist the packaging is intact and tags remain on the items.
  • Insist that the original receipt is provided and retained as part of the return.
  • Also refund using the same method as the original transaction and for credit cards, only to the card that was originally used
  • For a return that is missing the receipt or the packaging isn’t intact, provide a store credit.

Having a customer friendly returns policy doesn’t have to open your business up to fraud.