Five More Ways to Save

By Bob Violino

Depending on the nature of your business, there may be other ways to achieve significant savings with an RFID system.

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Complying with regulations

Regulatory agencies are putting increasing burdens on companies to track and trace prescription drugs (to reduce counterfeiting), meat (to control things such as mad cow disease) and shipping containers (to counter the threat of terrorism). RFID can greatly reduce the labor needed to comply with these regulations by eliminating bar code scanning or manual tracking.


Few companies will build the savings on a recall into their business case, because no company plans to have a recall. But if necessary, an RFID system could make it possible to identify exactly which products have a problem so only those products would need to be recalled. Those savings alone could pay for an RFID system.

Reduced obsolescence

Each year, pharmaceutical companies and grocery manufacturers throw away billions in goods that have passed their expiration date. Electronics, computer and high-tech companies either write off products that have become obsolete or sell them at huge discounts. RFID can help companies track goods by sell-by dates, and better inventory management can reduce overstocking of products with short life cycles. In both cases, the savings can be substantial for suppliers.

Reduced shrink

Manufacturers suffer losses due to delivery errors, improper accounting of returns, product diversion, fraudulent invoicing and other problems. RFID can greatly reduce shrink by providing greater visibility, traceability and order accuracy without increasing labor costs to achieve these gains.

Workers' compensation

As workers in most industrialized countries are getting older, claims for workers’ compensation associated with repetitive manual tasks such as bar code scanning are going up. RFID could help reduce such claims.