By Vikas Wadhwa
Chief Innovation & Markets Officer

Radio Frequency Identification (RFID) is a wireless recognition and data capture technology that can be used to recognise, trace and identify people, things and animals using radio frequency (RF) waves. RFID system comprises three components: an antenna, RFID tags (transponders) that are electronically programmed with unique information (serialised) and an RF module (reader) with a decoder (transceiver). RFID is poised to bring about many changesin distribution, retail, e-commerce, and manufacturing.

Till now, RFID is not adopted at scale, and some of the factors that made RFID prohibitive were the cost of tags, reader, and standardisation (inter-operability). In addition, a relatively long time for businesses to make the adoption decision requires them to undertake a fundamental strategic review of their business processes and their relationships with suppliers and distributors before adopting RFID or any emerging technology.

But the future of RFID looks promising post COVID due to the need for a touch-free frictionless world. RFID has the power to enable several workflows at the operational layer and connect the core elements and seamlessly collect the data, helping enterprises embark on their Industry 4.0 journey: by connecting MAN, METHOD, MATERIAL and MACHINES, in real-time. With the rising demand, the cost of the tags and readers (major cost component) has substantially reduced, EPCglobal RFID protocols standards are in place by GS1 (global not for profit standards organisation) and the rise of Industry 4.0 and IoT. In the near future, we anticipate mass use of RFID technologies across the industry verticals.

Let’s look at some of the other factors driving the demand for RFID technology in 2021 and beyond.

Internet of Things:
The rise of the IoT has caused a sea change in customers’ buying patterns and, by extension, the market strategies.

RFID solution providers like BCI are leveraging the rise of IoT and pursuing opportunities addressing industry pain points:

  • Investing in technology to enhance customer experience and incorporating big data analytics to analyse customer behaviour patterns and enable targeted marketing.
  • Apply this technology to boost employee efficiency and safety
  • Shifting focus from inventory management to end to end inventory visibility – right from production to consumption.

Industry 4.0:
One of the fundamental aspects of Industry 4.0 functionalities is the data transferred using RFID technology. Using this tried-and-tested technology, not only is it possible to transfer information and localise objects, but it is also possible to establish a globally unique object identification system—enablement of a growing number of processes and industries. As a consequence of the growing demand for automation, RFID technology is gaining momentum; Industry 4.0 requires the digital identification of workpieces, tools, containers, machinery, equipment, people, processes and machines. These objects also need to be able to exchange information with each other. RFID is poised to be one of the key enablers in the Industry 4.0 journey for enterprises.

Globalisation will focus on trade:
Technological advances, improvements in transport and communication all need to play their part. Removing obstacles to international trade such as the time and costs involved are two key areas to focus on and ones that RFID implementation can work to address.

As RFID tags and readers reduce in price, it makes it a lot more affordable for start-ups and SMEs to afford the technology and use it in their supply chains when expanding overseas.

Plus, as the technology grows in popularity, larger e-commerce companies can begin to use it more frequently and in innovative ways. Even though RFID technology has been around for many years, it’s only recently that many businesses have employed it, and there is still plenty of time for it to evolve and develop further.

Increase the ease of global supply chains:
Implementing RFID technology in supply chain management is advisable for improving the process. Not only can this work well on a domestic level, but for international trade, it can smooth out any potential issues. These could be when importing materials from abroad to create a product, such as steel from China, or delivering items to customers overseas.

One of the main benefits of RFID tags and readers in supply chains is that they can automatically count any item with a tag attached. When done manually, this can take longer and involve more labour. However, with RFID, items can be quickly counted at each chain stage to ensure all goods are present.

The main benefits of RFID technology in any supply chain include:

  • Improved visibility
  •  Less manual labour required
  •  No-line of sight required for data collection
  • Reduced costs
  • Quick location of products
  •  Handle higher volumes
  •  Increases accuracy and efficiency

Rise of Omni-Channel Retailing (offline2online)
The Offline online modelhas virtually transformed every store into a distribution centre, and retailers need to adopt  RFID and data analytics technologies to keep track of inventory in each outlet and, eventually, enhance customer experience management.

Retailers are looking to empower their workforce to enrich customers’ purchase experience, augmenting investments in technologies. RFID sales will further boost from the intensifying focus on minimal out of stocks, loss prevention, inventory management, and loyalty.

The growing interest in item-level tagging, especially in fashion and apparel, will further augment RFID demand. Leading retailers like Zara, M&S, Uniqlo and many more continue to invest in RFID and reap benefits of the RFID.

The burgeoning e-commerce, further fuelled by the current unprecedented circumstances, are driving online shopping volumes by over 10X during the last 12 months alone.RFID is helping manage this unexpected growth, increased shipment volumes througha complex distribution networkand meet customer expectations at the same time. RFID is serving several leading e-commerce players in India, like Amazon, Flipkart, Ninja Kart, and many more, to manage their supply chains better and keep customers informedof their shipment status at every stage.

FMCG:
Organisations within fast-moving consumer goodssupply chains are now looking to replace barcodes with RFID tags. More importantly, they want to progress from established RFID closed system environments to RFID open-loop environments leveraging EPCglobal standards.

Healthcare:
Patient safety is a serious global public health concern and more in the new normal. Official statistics show an increasing number of mistreatments within healthcare due to the improper identification of the patient or the drug administered to the patient. RFID is believed to be the next-generation technology for tracking and datacollection and has successfully been applied in several industries. RFID technology is also seen as the next disruptive innovation in healthcare and represents several opportunities for increased safety, operational efficiency and cost savings by tagging inventory, assets, patients and personnel.

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