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The Rise of RFID technology

RFID Technology

With the advent of big-box online retailers like Amazon.com and Costco.com, we have started to see a revolution in warehouse technology. As you would expect, these companies are not just buying up large buildings and putting their inventory inside, they are innovating and changing the way we view warehousing as an industry. One cutting-edge innovation being tested is the use of drones for delivery. Already, in parts of the world, drones can bring you anything from toothpaste to a new cover for your cell phone. It can literally be en route to you minutes after you place your order (see Amazon Prime Air), But drones aren’t the only cutting-edge technology helping to revolutionize inventory management and bring a new efficiency to warehousing.  Another such innovation is the broad use of RFID technology.


RFID stands for radio-frequency identification. It is a wireless method of storing and quickly transmitting information about a product. This gives a manufacturer or retailer the ability to identify and track products on a much larger scale than previously possible with older methods that rely on the recognition and interpretation of (typically) print information in order to find and track a package. In short, products can now move from manufacturer to retailer more quickly than ever. As a result, costs come down for consumers while the ROI for retailers and manufacturers increases.

 How Does RFID Work?

In the past, a typical warehouse required very little in terms of sophisticated technology just good computers, spreadsheets, and terminals to facilitate warehouse workers’ ability to track and find any inventory that the warehouse held. The investment in technology may have been low, but a warehouse required a large human contingent and would suffer the slowdowns and labor costs that come with that. Now, imagine a warehouse that does not require a human “picker.”  RFID technology lets a warehouse log in packages automatically and then stores that product description and the exact location. Orders arrive for a product and there is no need to hunt for it. Any product tagged with RFID technology could automatically be found when the order is made, and the transition from warehousing to shipping becomes as automated and as seamless as the ordering itself.

 Why Does This Matter?

RFID is part of the change in retail that is creating broader access to a larger range of goods and services, as well as another avenue for retailers to compete on price, helping us all spend less. Both of these are good news for those interested in saving money and in having a broader array of consumer options, and typically, that is a majority of us. Even better news is RFID technology benefits all of us in more than just consumer or retails applications.

 Non-consumer Applications

Somewhere, there is a farmer who will never lose another sheep because he can track his flock with implanted RFID chips. There’s also a car manufacturer that is able to lower its cost of production by doing efficiency studies premised on the location of any given piece of the car on the assembly lines at any given point in the manufacturing process. Imagine as well, an oil company knowing exactly where to look for dock workers reported missing from the oil platform in the middle of the Atlantic Ocean. RFID brings innumerable benefits to the various logistical needs of so many businesses and platforms. Being able to keep track of the individual components of a host of things (warehouse items, cellphone covers, car parts, dock workers) allows industries to streamline operations in ways that have previously been impossible.

RFID technology has lowered the cost of locating, identifying and tracking, and we are only starting to explore the many applications. It will be exciting to see what comes next.

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