Inventory management in logistics is the most crucial aspect of ensuring efficiency in order fulfilment. Efficient inventory management has a direct impact on the overall profitability of an eCommerce business and therefore, good coordination, monitoring, and management is a must for better inventory control, of your business.
While technological advancements have brought major convenience in inventory management, such as RFID, IoT, artificial intelligence, machine learning, etc. Among all these technologies, RFID came as a major revolution in the world of shipping and logistics. Ever since its inception, RFID has been a crucial factor in helping the global transportation and shipping industry with better accuracy in inventory management. Not only that, the use of RFID has increased the order processing speed and reduced labour costs with precise track and trace functionality.
This blog will answer many queries like what is inventory control, how RFID technology works in inventory management, and how feasible is the use of barcodes when compared to RFID. What’s the difference between the two and what are the benefits of leveraging these technologies in logistics and supply chain management? Stay tuned and get all your answers!
What is Inventory Control?
Inventory control refers to the maintenance, monitoring, and management of goods and products stored in the spaces owned by eCommerce sellers to sell them online or offline. In an online business, when an order is received, the process of order confirmation only takes place when that product is available in the inventory.
An eCommerce seller ensures that the goods in high demand are available in stock, but in the peak seasons, conditions of understocking and overstocking often take place. These conditions occur due to the bulk demands and most of the time, lack of proper inventory management often results in understocking conditions.
Basics of RFID And Barcode
RFID stands for Radio Frequency Identification which implies the use of radio waves to identify the objects labelled with specific tags. It is a passive wireless technology that is often used in commercial and industrial setups for hassle-free identification, tracking, and tracing of goods and commodities.
The RFID system consists of 2 basic parts: tags and readers. The function of the reader is to read the information encoded in the tags by sending off radio waves, and tags reciprocate by sending radio waves to share their identity and other information.
A barcode scanner, sometimes referred to as a barcode reader, is an electrical device that physically reads and decodes barcodes to extract information. In its most basic form, a barcode is a square or rectangle that has numbers, white space, and vertical black lines of various heights and thicknesses combined to uniquely identify a product and its pertinent details. They can be easily spotted in the clothes you buy, or the groceries or electronics you purchase from offline or online stores.
Importance Of Barcodes And RFID in Inventory Management
In an inventory space, where thousands of items and goods are stocked in not-so-systematic arrangement, their identification on a manual basis can become a menace for retailers and eCommerce sellers. Therefore, proper technology is needed to declutter the process and bring efficiency to the process of tracking, tracing, and identifying the products stored in the inventory for further order processing.
Hence comes the RFID and barcodes. RFID tags are attached to individual products or items with a unique identification number. An RFID reader uses radio waves to read this number and thus helps in real-time tracking of the item, enhancing accuracy in inventory management. RFID is considered more advanced than barcodes in terms of accuracy and real-time tracking, but it is an expensive technology and requires expertise for handling and implementation.
A barcode scanner reads the barcode tag attached to the goods or items and converts them into numbers and letters which carry the information of that particular product. It is usually affordable, easy to use, and simple to integrate with other existing systems.
Benefits of RFID And Barcodes In Inventory Management
Benefits of RFID in Inventory Management:
- Real-Time Tracking: RFID allows for real-time tracking of inventory items, providing instant updates on the location and status of products.
- Increased Accuracy: Reduces human error associated with manual data entry, ensuring more accurate inventory records.
- Faster Inventory Checks: Speeds up the process of inventory counts and audits, as RFID tags can be read in bulk without needing a direct line of sight.
- Enhanced Security: Helps in preventing theft and loss by monitoring the movement of goods throughout the supply chain.
- Automation: Enables automation of inventory management processes, such as automatic reordering when stock levels are low.
- Improved Efficiency: Streamlines the receiving, sorting, and shipping processes, reducing labour costs and improving operational efficiency.
- Data Storage: RFID tags can store more information than barcodes, including detailed product information and history.
Benefits of Barcodes in Inventory Management:
- Cost-Effective: Barcodes are relatively inexpensive to produce and implement, making them accessible for businesses of all sizes.
- Ease of Use: Simple to use with barcode scanners, which are widely available and easy to operate.
- Improved Accuracy: Minimizes errors in data entry and ensures accurate tracking of inventory levels and product details.
- Speed: Speeds up the process of checking in and out inventory items, reducing time spent on manual counting.
- Inventory Control: Enhances inventory control by providing quick and accurate data on stock levels, helping to prevent overstocking or stockouts.
- Data Collection: Facilitates the collection of detailed information about inventory items, such as price, location, and movement history.
- Integration: Easily integrates with existing inventory management systems and software, allowing for seamless updates and tracking.
Other than using the barcodes and RFID for inventory management, using an advanced WMS by logistics providers like NimbusPost lets you manage the supply chain efficiently. You can keep track of all data in a single place which lets you handle inventory of all your stores in a streamlined manner.
Conclusion
Both RFID and barcodes majorly improve inventory management by boosting accuracy, efficiency, and overall control of inventory processes. RFID offers advanced features like real-time tracking and automation, while barcodes provide a cost-effective and straightforward solution for accurate inventory management.
But before you choose between the two technologies, remember to consider factors like ease of integration, data storage, read range, size of your business, inventory environment, and most crucially, your budget!