Paybacks from RFID tagging down at the item level – as opposed to the bulk pallet level – are emerging, and they could be greater than previously thought.
Research among case studies by Cambridge-based self styled RFID experts IDTechEx appears to show early evidence that even some of the difficult to quantify projects can offer substantial and reasonably fast ROI.
IDTechEx cites CPG manufacturers, for example, as starting to demonstrate the potential for good ROI, while in the pharmaceutical sector, drug anti-counterfeiting paybacks looks likely to be about two to three years.
Aerospace, it says, looks likely to get ROI in one to two years on aircraft parts, while the automotive sector in tyres, for example, could see one year assuming it replaces its paper labelling procedures.
The organisation also points to experience with returnable containers – as in gas cylinder and beer kegs – which demonstrate one year ROI from RFID at the item level.
Says IDTechEx’s Dr Peter Harrop: “Whereas the benefits of tagging vehicles, inter-modal containers, pallets and cases in supply chains are almost all financial in nature, and of limited variety and magnitude, item level RFID tagging on the grand scale offers a far wider variety of financial benefits and also many non-financial benefits.”
And he adds: “Very short paybacks usually involve major changes in working practices facilitated by RFID – little wonder then that there is intense interest in further application of RFID, particularly at item level.”
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