Yes, RFID (Radio-Frequency Identification) technology can help businesses of any size increase their profitability. Although big companies have used RFID to raise their profits, many SMEs (small and medium-sized enterprises) are not certain if it can deliver the same advantages. The following will discuss the benefits of implementing RFID for SMEs.
RFID Technology Basics
RFID is utilized for identifying and tracking tags attached to product components, equipment and finished inventory items. RFID tags contain electronically stored information about each item including the location and condition of the item. These tags are used in a wide range of industries.
RFID helps businesses track shipping and inventory data in real time. If your company’s sales are dependent on strong data collection and analyses, RFID technology will support these tasks.
The ability of RFID technology to track inventory will also make your organization’s logistics process more efficient. Accuracy in inventory count will help ensure that your company has sufficient stock levels for products that are selling consistently. Being aware of the correct stock numbers also makes deliveries to customers faster.
Advantages for SMEs
Although it is largely used by big businesses, the advantages that small and medium-sized business can gain from implementing RFID can be substantial. Research has found that almost 75% of retail businesses had either implemented the technology or had plans of implementation to benefit from greater inventory accuracy.
The great advantage RFID can bring is being able to track inventory throughout the supply chain. Retailers that lack RFID technology rate their inventory accuracy at about 25%. This is unacceptably low because this will lead to customers being unable to purchase the products they want in a timely way. RFID technology can raise the inventory accuracy of a business to nearly 100%.
Being able to meet customer demand when they are ready to purchase your products boosts profitability. Even though RFID implementation may be quite costly, the return on investment over time will help justify the outlay. This is especially true for companies that sell expensive items.
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