Thursday, January 04, 2007

Looking for RFID ROI

There's a nice thread on RetailWire about the ups and downs of RFID, which was once heralded as the greatest thing since the barcode, but is currently still looking for a place to truly shine. As Chantal Polsonetti, VP of Manufacturing Advisory Services for Arc Advisory Group notes, many manufacturers don't expect massive supply chain benefits by implementing RFID systems, and instead are looking for secondary benefits to drive ROI:

"Our manufacturing customer base is telling us they already have sophisticated supply chains, so the benefit from RFID in the distribution center is incremental at best," she told Modern Materials Handling. "Instead, they're looking at applications around asset tracking, work-in-process and how product moves through the retail store to get an ROI."

Back-office applications still seem like the best fit for RFID, though there are certainly numerous applications that could benefit from the extra awareness that an integrated RFID system brings, and NCR has suggested some ways that RFID could be used to improve the in-store experience. Still, until consumer trust in the technology improves and certain security issues are resolved, I expect that RFID will continue to have more to do with tracking boxes in a warehouse than helping a shopper locate products in store.

Tags: RFID, ROI, in-store experience, supply chain management

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