Tariffs are at the front of minds of businesses and shoppers as affordability remains the number one economic issue. A key point in attempting to keep costs down,RFID, IoT and artificial intelligence (AI) have proved to be some of the most effective at managing supply chain.
These technologies have emerged as a key tool in helping businesses stay agile and avoid the worst effects of tariff disruptions. While tariffs may strain operations, RFID’s ability to provide real-time visibility, enhance inventory management, and enable data-driven decision-making is proving invaluable.
“More than ever, businesses must leverage technology to be more proactive, not reactive,” said Lisa Henriott, SVP Product Marketing, Logility. “Businesses can predict risks— from tariff changes to supplier failures—before they cause disruptions.”
RFID Strongpoints
One of RFID’s most significant advantages is its unparalleled inventory accuracy. This precision enables businesses to track inventory in real time throughout the supply chain, from warehouses to retail stores, ensuring better forecasting and minimal waste.
According to Dean Frew, President of SML IIS, the increased inventory accuracy from RFID enhances the effectiveness of the use of their AI tools in driving optimization
“With item-level RFID deployed, retailers can manage their inventory through significantly improved accuracy of over 98 percent,” Frew recently wrote. “This allows retailers to continue to maximize product sales while optimizing costs in manufacturing or procurement, transporting, and storage.”
Logility Report
The ability to prepare for and manage disruptions is an area that businesses can improve on, according to Henriott. In Logility’s 2025 Supply Chain Horizons Report, the report found 48 percent of respondents can predict disruption up to a week in advance and 52 percent said that implementing the selected scenarios they can imagine is a challenge. Henriott explained industries fall into three buckets when it comes to a disruptions like tariffs:
- Rigid and brittle industries. Automotive, industrial durables, and semiconductors, for example, have deeply entrenched supplier communities. Qualifying a new supplier in a new geography takes lead time and confidence in making the right decisions.
- Flexible but cost-sensitive industries. Consumer goods and food & beverage sectors that need to pivot frequently to maintain tight profit margins.
- Secondary impact industries. Component manufacturers and logistics providers and component manufacturers that get caught in the ripple effect of broader supply chain changes.
AI Test Case
To navigate the up and downs, Henriott has seen “the power of using automation and AI-driven analytics improve business response.” She pointed to a global heavy equipment manufacturer that relies on a sourcing steel from across the globe finding new suppliers by using AI-powered simulations to model the entire supply chain impact.
Initially, the direct impact of paying a tariff or higher production cost for a new supplier would have cost the company $100 million. However, by re-optimizing the whole supply chain, that mitigated the cost increase to only $60 million.
“This was achieved by tweaking supply routes, adjusting production locations, and shifting final distribution points without causing significant disruptions,” said Henriott. “This strategy went beyond merely swapping out suppliers to include the optimization of the entire production and logistics flow.”
Handling Cost Concerns
Costs are a top concern for retailers and the demand for RFID systems has been driven by the need for efficient asset tracking in their supply chain that provides deeper insights into their inventory post-pandemic.
SML IIS’s Frew noted with accurate visibility of current inventory, supply chain operators can more accurately predict the stock required and generate tasks to move the products to where demand is occurring or where shortages exist with RFID.
“Trade tariffs…could worsen disruptions, with potential price increases on a range of items and rapidly changing rules that threaten to trap products in customs should retailers make mistakes during inventory distribution,” he wrote. “To avoid situations that threaten sales opportunities, revenue, and ultimately, profit and customer service, retailers must be extremely accurate with where and when inventory is in place to maximize chances of meeting demand.”
Impact on Retail, Healthcare
According to Manuel Reguart, business development, strategy and alliances at Clustag | RFID Solutions (formerly RIELEC), one industry where making informed decisions about when and how -from where- to replenish inventory is critical is the fashion sector, where demand can be volatile and production cycles rapid.
“An efficient inventory control system, enhanced by technologies like RAIN RFID, will allow companies to monitor the flow of goods in real-time, adjusting their purchasing and distribution strategies to minimize the impact of tariffs,” Reguart wrote.
Beyond manufacturing and retail, healthcare is another industry grappling with supply chain and tariff issues. Advantus Health Partners and Bon Secours Mercy Health Chief Operating Officer John Wright said they have been forward buying in product categories they see at the greatest risk, stockpiling product to mitigate against the impact of a price increase.
Creating Solutions
Additionally, they created a visualization tool matching up all the country-of-origin data with insights from their contracts where they have risks for tariff increases. That is enabling Advantus to forecast what the potential financial impact could be based on future run rates.
“AI allows us to review our contract history and contract language, compare that to what we know about the new tariffs and forecast the impacts,” said Wright. “AI is definitely playing a critical role and will continue to be a key part of information gathering.”
Data Insight From RFID
Wright stressed that that having better insight into on-hand inventories is critical, which a lot of the RFID systems can do. The data fathered mitigates against the impact either financially or physically ability to obtain that product.
“The (Enterprise Resource Planning) systems—if you’re scanning your inventories and regularly cycle counting—you have that insight. You know what you have, your burn rate and you can forecast the demand and plan,” he said. “That allows you to make decisions where you forward buy product and stockpile in anticipation of a tariff or other disruption.”
“The various tools all work differently to give you insight into your inventory, and then you can make informed decisions to try to mitigate risks.”
Although tariffs bring complexity to global supply chains, RFID and AI products have provides a competitive edge in minimizing cost implications and navigating unpredictable trade policies. RFID-enabled supply chains offer better visibility and data accuracy, unlocking opportunities to optimize procurement, maintain compliance, and stay ahead of disruptive forces.