The utilization of IoT tools (Internet of Things)
Many of the electric devices/sensors that are applied to smart packaging use the global interconnected network called the Internet of Things. The concept of IoT (internet of things) is aimed at providing a global interconnected network infrastructure for connecting objects to the cyber- physical world. It enables companies to track and trace their products which are equipped with sensors devices (Cheung, 2018).
The main IoT tools are elaborated upon below.
RFID (radio-frequency identification): is an electronic sensor and data collecting system using RF signals located on packages to monitor critical parameters such as temperatures, pressure, and vibration which captures and communicates data about how the products are moving along the supply chain and enable organizations to track and trace the product during its journey from manufacturer to customers (Cheung, 2018). The use of smartphones to increase the supply chain visibility and anytime access by using available handled devices is quickly standardizing for companies’ solutions. The technology is optimal to track products that are in transit (Fedex, 2020).
Traditionally, inventory counts were a complex exercise done manually about once a year but RFDI technology enables retailers such as Macy’s to monitor stock monthly bringing accuracy from 60% to over 90%. Macy’s reported that it experienced 2-3% inventory inaccuracy per month which is 24% annually but by implementing RFID solutions it minimized out-of-stock situations, provides real-time merchandise location data and allows to track their inventory throughout the retail supply chain (Bianchi, 2017).
NFC (near field communication): is non-contact near-field communication technology. NFC reader is a tool that can be integrated into the warehouse management picking verification system. The benefits of using such technology are its combinations with the smartphone as a carrier for the logistics industry and optimize the management process with a low error rate to increase operability without sacrificing labor and resources efficiency; thereby enhances the company competitiveness by increasing efficiency inside warehouse management as well as cost savings for the further development of the logistics industry. Furthermore, it helps eliminate the paperwork and provides information about the inside of the package such as the location of the product inside the warehouse, description of the item, and the number of items inside the warehouse.
All of these pieces of information are readable through the smartphone. The system enables smartphones to read the NFC tag on packages and allows the operator to read the information needed (Hou, 2016). The Diageo company integrated NFC chips for a type of alcohol drink “Johnnie Walker blue”. Customers who have an NFC chip, enable phones to read information from the NFC on the label with additional information about the product and find out if the bottle was in some way misused. It also allows the company to track the product during the whole supply chain, storages, and the opening times (Vasić, 2018).
Barcode label: Plenty of operations happening inside the warehouse rely on administrative documentation. The use of these barcodes, rack labels save a lot of time to the different employees in term of packing and picking process as they only need to scan the barcode and receive all the information needed on the requisite hardware to read them. The barcodes label also benefits in managing inventory by being able to track the exact location and movements of products in and out of the warehouse facility as well as eliminating delays and error.
Barcode labels are usually called the foundation of automated warehouses as it was the first data tracking technology and refers to one-dimensional data which means that they can only hold information in the horizontal dimension. They provide several crucial benefits such as inventory tracking, arrival planning, improved picking efficiency, traffic optimization, decrease human data entry errors, and reduce out of stock situations (Jules, 2020).
Weerts supply chain is using barcodes label on its stored products to monitor the localization of its goods. Weerts supply chain is storing a lot of perishable goods such as chocolate, therefore besides having a temperature control inside the warehouse, the barcode label indicates the perishable dates of the products. Thus, they can distribute to supermarkets the goods with the closest perishable date just by scanning the rack where the product is placed (Richelle, 2021).
Figure 1Vasić, Đ. &. (2018). NFC Technology and Augmented Reality in Smart Packaging.
The table above compares the different technological devices and differentiates them in terms of speed, scalability, devices needed, sensing distance, and error rate. It is obvious that compared to the verification systems, the manual work is slower and error rates are high (Vasić, 2018).
All the different devices result in advantages for Supply Chains through the use of IoT tools and help companies in their daily operations. Although the initial cost concerning new sensors technologies are high, the inherent opportunities incentivize companies to invest in the integration of IoT.
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