Retailers face the constant demand to have the right goods available at the right places in the right quantities. First and foremost, incorporating RFID technology into existing supply chain operations can reduce the labor required to monitor goods movement and inventory flow. Bar code-based tracking systems are an effective tool for basic inventory tracking. Used in conjunction with a bar code system or as a stand-alone inventory tracking application, RFID allows manufacturers and retailers to complement existing systems while gathering more information throughout a supply chain. Systems with the power to update the information that moves with an individual product provide complete supply chain visibility without the prohibitive labor costs and error rates a similar manual system would entail.

RFID tracking systems are finding their way into cross-dock and warehousing applications first. But as they stretch further throughout a retail supply chain, they will require close cooperation between suppliers and retailers. As RFID systems are adopted, manufacturers will tag goods during production so everyone along the way, from supplier to manufacturer to logistics teams and end customers, benefits from the increased information that RFID systems provide. Large global retailers will begin to demand that suppliers provide RFID-tagged packaging at the overpack/case level. That likely will happen first at the inventory control and pallet tracking level, followed next by high-ticket item goods such as electronics, then by other product groups as total system costs come down.