The Manufacturer Magazine : Promoting best practice in Manufacturing

RFID usage could save manufacturers billions

Manufacturing News, Source : TheManufacturer.com
Published : 19 Jun 2003 13:45

Manufacturers coud reap benefits from improved asset utilization, inventory accuracy, and customer service

As the price for technology like RFID tags continues to drop, their usage in the manufacturing sector is expected to explode.

RFID tags, which track inventory and equipment, could save manufacturers and retailers billions annually, according to a research report released by Accenture. The technology, known as auto-ID, is a combination of electronic product codes and radio frequency identification. Gillette is already well underway with a pilot program to test RFID tags on one of its major razor blade lines.

Auto-ID solutions can dramatically improve production operations, asset utilization, forecasting and inventory accuracy and, ultimately, customer satisfaction by pinpointing the location and status of products as they move through the manufacturing and retail value chain. These improvements can increase the quality and efficiency of the entire supply chain and lead to significant savings in areas such as inventory and labor costs.

"Our research found that by 2005, many manufacturers -- especially those in the consumer electronics and grocery sectors -- will be using RFID technology to track products at the pallet and case levels," says Jeff Smith, global managing partner of Accenture's Retail & Consumer Goods practice. "And retailers -- particularly in the consumer electronics, pharmaceutical and apparel industries -- should be among the first to use RFID tagging at the item level."

Accenture says that auto-ID technology can help manufacturers to save in a number of ways:

-- Cut working capital by two to eight percent by reducing the amount of raw materials inventory needed for production as well as the amount of work-in-process and finished goods inventories;

-- Reduce fixed assets by one to five percent through better maintenance and utilization of equipment;

-- Increase revenues up to one percent through improved quality and customer service.

"RFID can deliver significant economic and competitive advantages. Manufacturers have a tremendous amount to gain and can realize the benefits by using RFID and EPC at the case, pallet or item level," said Lyle Ginsburg, managing partner for technology innovation in Accenture's Products operating group.

Comments on this story

click here to add a comment

Related Content

FKI LOGISTEX OPENS NORTH AMERICAN TECHNOLOGY & EDUCATION CENTER (TEC)
(St. Louis, Missouri, USA: July 10, 2007) FKI...
more…

Guess selects the tradecard platformand SourceView suite to optimize global trade
NEW YORK, July 10, 2007 – TradeCard Inc., the...
more…

Kimberly-Clark Professional Crosses Final Touchless Frontier With Introduction of First Electronic Bath Tissue Dispenser
ROSWELL, Ga. (July 9, 2007) – Kimberly-Clark...
more…

Boeing Celebrates the Premiere of the 787 Dreamliner
EVERETT, Wash., July 08, 2007 -- Today, Boeing...
more…