RFID for Inventory Management

Pros of RFID for Inventory Management

As one can imagine, implementing RFID can be transformative for manufacturers. Improved Visibility & Faster Scanning

• Enable real-time inventory tracking without the need for manual scanning.
• Reduce cycle counting time by up to 50%, leading to increased productivity.
• Eliminate human error associated with traditional barcode scanning.

Enhanced Supply Chain Visibility & Product Traceability

• Achieve greater transparency across the supply chain by enabling real-time tracking of goods as they move through different stages, reducing errors and inefficiencies. By automatically capturing and sharing data across various touchpoints, RFID helps businesses identify bottlenecks, streamline logistics, and improve overall coordination between suppliers, manufacturers, and distributors.
• Improves tracking of returnable assets (e.g., containers, pallets, equipment).
• RFID has become essential in highly regulated industries (e.g., food & beverage, pharmaceuticals) where traceability is critical for compliance.

Cons of RFID for Inventory Management

As with every technology in the manufacturing ecosystem, RFID does come with several downsides. Cost

• RFID Tags: Passive tags are inexpensive, but active tags are significantly more costly.
• Infrastructure: Readers, antennas, and integration with existing systems require a high upfront investment.
• Maintenance: Regular calibration and software updates are necessary to ensure performance.

Scalability Challenges

• Expanding RFID implementation across large-scale operations can be complex and costly.
• As the number of RFID tags and readers increases, companies may face diminishing returns.

Security Vulnerabilities

• RFID tags: Tags can be cloned, leading to security risks. If security measures aren’t in place, data breaches may be possible.

Technological Limitations

• Signal interference: Shop floor infrastructure—from surfaces to machinery—can be disruptive to RFID technology, as the devices are dependent on the transmission and reception of radio waves. To ensure optimal performance, manufacturers may need to consider denoting extra time to device calibration.

RFID vs. Barcode Technology

Feature	RFID	Barcode
Accuracy	High (real-time tracking)	Requires manual scanning
Cost	Higher upfront cost	Low-cost implementation
Scalability	Challenging for large operations	Easier and more affordable
Ease of Use	Requires training & integration	Simple, widely used

Best Use Cases for Each Technology While there is no “one size fits all” rule for how (and when) RFID should be implemented, here are some general guidelines:

• RFID is best for: High-value items, sensitive environments, and large warehouses with high inventory turnover.
• Barcodes are best for: Items with curved surfaces (e.g., cables, wiring), simple stock tracking, and cost-sensitive operations.

Integrating RFID Tracking with an MES

Collecting data via RFID technology can be a great step for manufacturers looking to optimize their traceability and supply chain visibility. However. Integrating RFID with a Manufacturing Execution System (MES) like TrakSYS expands those benefits, delivering things like:

• Enhanced production visibility
• Improved Efficiency
• Optimized OEE.
• Increased quality control
• Readily-maintained regulatory compliance
• Reduced storage, insurance, and obsolescence cost

Is RFID Right for You?

RFID technology can significantly improve inventory management by offering real-time visibility, removing errors associated with manual data capture, and enhancing supply chain coordination. However, the technology should not be implemented without consideration. Businesses looking to adopt RFID will benefit from carefully considering things like cost, scalability, and security risks before they move to invest. If you have questions regarding an upcoming RFID project, or if you want to learn more about how TrakSYS works in conjunction with an existing RFID deployment, contact us today.