The importance of accurate real-time data to your organization cannot be overstated. The pillars of world class data accuracy in ERP are: Bill of Material Accuracy, Routing Accuracy and Inventory Record Accuracy Let’s talk about how technology can improve inventory accuracy. An ERP solution that consolidates data into a centralized database in real-time is ideal, promoting a unified source of truth within the organization. Achieving a high degree of inventory accuracy can expedite order fulfillment and enhance job performance for all team members. Your minimum accuracy has to be 95%. Understand that world class is 99.89% – this means the count correct, the locations are correct and the item description is correct.
To work effectively with suppliers and minimize disruptions in the supply chain, manufacturers can utilize RFID technology. Real-time inventory tracking via RFID leads to more precise inventory counts and order forecasting. Additionally, the technology simplifies tracking for high-value materials, warehouse automation, and quality maintenance. RFID enables companies to eradicate out-of-stock orders and trace product issues promptly.
What is RFID Technology?
RFID stands for Radio Frequency Identification. It is a wireless technology that uses radio waves to transfer data between a reader and a tag. The tag contains an electronic chip and an antenna that can transmit data to a reader within its range. The reader sends the data to a computer or database, which stores and analyzes the information.
There are two types of RFID tags: passive and active. Passive tags do not have a power source and rely on the reader’s energy to send data. Active tags, on the other hand, have a power source and can send data without relying on the reader’s energy.
RFID technology has been around for decades, but it has gained more attention in recent years due to its increased reliability, affordability, and ease of use. It has become an essential tool for supply chain management, inventory management, and asset tracking.
Benefits of RFID Technology
Discussing the advantages of utilizing RFID technology, it facilitates cost savings while simultaneously ensuring efficient and speedy product scanning. The use of RFID tags has become the new industry standard for inventory management, improving the consistency of asset tracking, as well as providing faster scanning and heightened visibility.
Unlike barcode scanning, RFID tags do not require a direct line of sight to be read. Furthermore, scanners can read these tags from various angles and settings, increasing inventory visibility.
Through the implementation of RFID technology you can track a diverse range of assets/inventory throughout the supply chain process and improve visibility across multiple inventory locations.
RFID technology combined with a well-structured process can provide inventory balances with 95-99% accuracy, along with improved shipping and picking accuracy. The increased accuracy can lead to reduced costs throughout the supply chain, with some experts estimating up to 80% improvement in picking and shipping accuracy. Additionally, RFID can enhance inventory visibility and availability, as well as increase accuracy in inventory counting.
By utilizing RFID to improve various aspects of the supply chain, you can significantly reduce distribution costs. For example, RFID enables accurate inventory counts with minimal administrative work for deliveries. On average, the expenses related to warehousing and distribution constitute between 2% to 4% of the overall operating costs. However, adopting RFID technology to track pallets, cases, cartons, and individual products within the facility can effectively replace labor-intensive point-and-read operations. This technological shift can lead to a substantial decrease in labor expenses, resulting in cost savings of 30% or more. With improved inventory and order accuracy, your team can consistently deliver the correct products at the appropriate times.
Using RFID Technology for Inventory Management
According to a “Innovation Driven Resilience,” the 2021 MHI Annual Industry Report, MHI and Deloitte found that, more than half of the companies, i.e., 52%, are enhancing their investment in sensors and automated identification. Additionally, around 27% of companies intend to incorporate this technology into their operations within the next two years.
Determining the appropriate level of detail for your organization depends on factors that are unique to your enterprise software. To ensure that your inventory management, ERP, and warehouse management system (WMS) can accommodate a high level of detail, it is advisable to conduct an evaluation with a focus on ROI. It is important to note that this task cannot be effectively executed using an Excel spreadsheet.
It’s needless to state the significance of precise data for your organization, but maintaining inventory accuracy must be a top priority. In an ideal scenario, you possess an ERP solution that fetches data in real-time and maintains a centralized database, providing a single source of truth for your organization. With an increased level of inventory accuracy you can fulfill picklists swiftly and enable everyone to perform their job with greater efficiency and confidence.
Once the concern of inventory accuracy is eliminated you can concentrate on crucial aspects of the business, such as obtaining new contracts or expediting the digital transformation. Rather than anticipating RFID mandates to surface in your sector (assuming they haven’t already), the present moment is opportune for adopting a solution that can advance your organization towards its next phase of development.
With the assistance of BWISE, your business can reap the advantages of RFID tags, including improved inventory and material accuracy. Utilizing RFID technology can enhance your inventory accuracy by over 10%, according to our research.
At BWISE, our area of expertise lies in incorporating real-time location system solutions. We have the proficiency to suggest the most suitable technology solutions that cater to your business requirements, and also provide comprehensive support throughout the entire project lifecycle. This includes consulting, conducting trials, deploying the solution, and ongoing support.
Would you like to enhance your business’s stock precision and visibility?
Call us at +1 562 503 7082 , request a demo here or drop an email at sales@b1bwise.com