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Abstract
The study is a continuation of the Phase I study into Supplier ROI, and was performed through 2011 with funding by GS1 US and the American Apparel and Footwear Association AAFA. The goal of the research was to focus on a few key use cases as identified in Phase I, analyze RFID data collected from Retail Suppliers who are implementing these use cases, and determine to what extent RFID can be used to generate ROI within a Supplier’s own operations. Much of the research focused on the Supplier’s Distribution Centers, and how RFID can help with inventory accuracy, shipping accuracy, and the costs to achieve high levels of accuracy. Also the effects of inventory accuracy on Retailer claims and DC operations are discussed. Some tools are included to allow suppliers to calculate potential ROI within their own operations.
Summary
Inventory accuracy is a massive problem in the supply chain- audits are costly to perform, and manual procedures are inefficient. Human error and bias in the auditing process also make the reliability of those methods questionable. RFID has been found to work exceedingly well with apparel items, meaning that the technology has high potential to improve these problems within the apparel supply chain space.
Using RFID tags and read points, item-level quantity audits could be performed in over 99.99% of all cartons, with perfect scalability. These readings can be done near instantly at every carton, at a higher speed and accuracy than manual checks. This comes with a reduction in costs at a low error rate.
Data collection in Phase 2 comes from several field studies, questionnaires, and supplier focus groups.
