Manufacturer Decision Analysis on RFID Adoption

Abstract:

RFID technology has many advantages and plays an important part in eliminating the inaccuracy of inventory information. This paper analyzed how manufacturers decided the raw material ordering quantity to maximize their profit when the price of raw materials was given through newsvendor model. Combined with the impact of putting raw materials wrongly and lost of raw materials, we compare the profits of not adopting RFID technology and that of adopting it. Then we obtain the biggest cost that manufacturer could undertake when adopting RFID, and the results can provide the foundation for the decision maker of manufacturing enterprise.

• Periodical: Applied Mechanics and Materials (Volumes 336-338)
• Pages: 2483-2487
• DOI: https://doi.org/10.4028/www.scientific.net/AMM.336-338.2483
• Online since: July 2013
• Authors: Gui Tao Zhang, Jin Song Hu, Chun Long Zhao, Kui Kui Wang, Guo Rui Wen
• Keywords: Make Decision, Manufacturer, RFID Technology, Tag Cost

References

[1] Aysegul S, Nabil A, Stephane D P. A literature review on the impact of RFID technologies on supply chain management, Int. J. Production Economics, 128 (2010) 77–95.

[2] Angeles R, RFID Technology: Supply-Chain Application and Implementation Issues, J. Information Systems Management, 22(2005)51-65.

DOI: 10.1201/1078/44912.22.1.20051201/85739.7

[3] Zhu X W, Samar K. Mukhopadhyay, Hisashi Kurata, A review of RFID technology and its managerial applications in different industries, J. Eng. Technol. Manage, 29 (2012) 152–167.

DOI: 10.1016/j.jengtecman.2011.09.011

[4] Worapot J, Somjit A, LiY F, Business process analysis and simulation for the RFID and EPCglobal Network enabled supply chain: A proof-of-concept approach, J. Network and Computer Applications, 34 (2011) 949–957.

DOI: 10.1016/j.jnca.2010.04.003

[5] Delend, Hardgrave B C, Sharda R, RFID for Better Supply-Chain Management Through Enhanced Information Visibility, Production and Operations Management, 16( 2007) 613-624.

DOI: 10.1111/j.1937-5956.2007.tb00284.x

[6] Ustundag A, Tanyas M, The impacts of Radio Frequency Identification (RFID) technology on supply chain costs, Transportation Research Part E, 45 (2009) 29-38.

DOI: 10.1016/j.tre.2008.09.001

[7] Juan J N, Lee S, Impact of RFID information-sharing strategies on a decentralized supply chain with reverse logistics operations. Int. J. Production Economics, 136 (2012) 366-377.

DOI: 10.1016/j.ijpe.2011.12.024

[8] Elgar F, Christian T, Inventory inaccuracy and supply chain performance: a simulation study of a retail supply chain. Int. J. Production Economics, 95 (2005) 373-385.

DOI: 10.1016/j.ijpe.2004.02.003

[9] Kang Y, Information inaccuracy in information systems, Ph.D. Dissertation. Massachusetts Institute of Technology. (2003).