Manufacturers who are subject to RFID mandates must ensure that their consulting and solution providers implement automated product data flow and hands-free data generation through the use of fixed RFID infrastructure versus manual portable equipment.
Fixed RFID readers are necessary in order to fulfill RFID's supply chain automation vision and eliminate the incremental labor and material handling costs associated with current slap-and-ship techniques. According to ARC's recent report, "RFID Systems in the Manufacturing Supply Chain," RFID's lack of reliance on line-of-sight readings enables widespread use of fixed readers, whose shipments are expected to grow at a compounded annual growth rate (CAGR) of 64.6% over the next five years. The total market for RFID Systems used in manufacturing supply chain applications, including tags, readers, and other hardware infrastructure, totalled $65.8 million in 2003 and is forecasted to grow to almost $3.8 billion in 2008.
Today's typical RFID compliance tagging scenario involves labor-intensive, end-of-line slap-and-ship operations that are usually performed in a warehouse or distribution center. This approach is costly because of the typical reliance on standalone stations that employ manual handling, exception routing, and, consequently, increased labor requirements.
"More ominously, slap-and-ship is not a scalable approach that can be ramped up to production volumes in conjunction with the rapidly escalating time lines embodied in customer mandates. Enabling increased product output is particularly crucial in the ramp-up from pilot to production, since early findings reveal that RFID can have a negative impact on production rates," said ARC vice president Chantal Polsonetti, the principal author of ARC's "RFID Systems in the Manufacturing Supply Chain."
RFID readers are part of the infrastructure that enables EPC data to move through the RFID-enabled supply chain. Fixed readers for shipping and receiving dock doors, overheads and vehicle and forklift mounts should be the choice of manufacturers since they enable the type of automation that results in personnel reductions. Data collection occurs automatically as tagged items, cases, or pallets pass fixed readers mounted on conveyors, dock doors or forklift trucks, with no human intervention required.
Hands-free operations through the use of fixed readers and other RFID infrastructure, which are part of the factory or distribution center infrastructure, will eliminate the incremental labor and material handling costs associated with current slap-and-ship techniques. Consequently, manufacturers should ensure that their RFID consultants, system integrators and enterprise software providers are partnering with technology providers who provide this type of capability and enable hands-free operation and automated data flow.
As the RFID infrastructure to support supply chain activities falls into place, one of the looming questions is where to place key functionality such as tag filtering and verification. Intelligent "thick client" readers will incorporate more and more of the middleware functionality currently embodied in separate software entities. Manufacturers must therefore ensure their solution providers architect a system that meets their functional requirements at the lowest possible cost
