Issues with Supply Chain and RFID in the Retail Industry

The retail industry is experiencing problems in the supply chain because there is no formal collaboration between the retailer and supplier. Demand uncertainty in the supply chain, known as the "bullwhip effect," results in excess inventory and inefficiencies in the supply chain. Demand forecasts and orders are often distorted unless they are developed jointly by the partners. These factors create a need for supply-chain integration and a way to provide supporting collaborative forecasting and replenishing processes, with the goal of increasing sales and reducing inventory investments and cycle time. Collaboration can reduce waste in the supply chain, but it can also increase market responsiveness, customer satisfaction, and competitiveness among all of the members of the partnership. Radio Frequency Identification (RFID) provides a major advantage to supply chain management. Implementing supply chain collaboration along with RFID can enable retailers to achieve the best level of business performance. Retailers can expect extensive inventory and labor-cost savings. RFID has the most potential to offer in streamlining the value-chain management, but handling the amount of data by RFID in the retail industry limits the potential of RFID benefits. SAS solutions are built on a solid framework of data management and analytic technology that can scale to any size database—even those that contain the expected massive amounts of RFID data. SAS Retail Intelligence Solutions is RFID-compliant and can handle huge RFID data, which adds to the benefits of supply chain collaboration and RFID.