According to recent studies, only 33% of manufacturers use inventory management software, and the remaining 67% remains on Excel or paper methods. They take an average of 18 hours each month to write the stock details on the paper, then enter the information of each item into the spreadsheet. However, labor intensity is not the only problem - MARKETWATCH estimates 88% of the spreadsheet contains error messages.
The good news is that the manufacturer can solve problems related to manual methods, and understand their inventory status in real time, with industrial networking (IIOT) and RFID.
1
Intelligent inventory: What is behind?
In an inventory management solution based on industrial Internet of Things and RFID, any single stock item to be tracked will post RFID tag. Each tag has a unique identifier (ID), which contains coding digital data related to stock items, such as models, batch numbers, etc. The label is scanned by the RFID reader, after scanning, the reader extracts the ID ID, and transmits it to the cloud.
In addition to the ID of the tag, the cloud also receives data regarding the reader position and reading time. Based on this data, cloud uses the corresponding ID to indicate the location of the item, visualize the results, and display the real-time update of the inventory item movement to the solution user, so that they can use smartphones or laptops to monitor inventories from anywhere.
Let us understand the technology of achieving intelligent inventory management.
RFID
RFID (RF Identification) system is mainly composed of three parts: RFID tag, RFID antenna, and RFID reader.
RFID tag
The ID of the RFID tag contains information about a particular object. It can be attached to any physical surface, including raw materials, finished products, packaging, crates, trays, and the like. In industrial environments, mainly use passive labels, that is, those labels without internal batteries. This label is relatively inexpensive, but it is necessary to transfer data with the energy of the reader.
RFID antenna
The RFID antenna receives the radio wave from the reader, providing energy for the label, and forwards radio signals from the label to the reader.
RFID reader
The RFID reader can be fixed or hand-held, which uses radio waves to read and write the label. The reader captures the ID information written in the label repository and transmits them to the cloud with the reader position and the read time.
Industrial network
The role of industrial network (IIOT) in inventory management can be classified to convert the data acquired by the RFID reader to a meaningful insight of the location, state, movement of the stock item, and provide the user with the corresponding output. For example, based on data inventory quantity and location, machine learning can predict the number of raw materials required for the next production cycle. The output provided by the Internet of Things system can have a variety of forms: if any individual stock item is lost, it can send alert to the user and notify the need to supplement the material.
In addition, an inventory management solution based on industrial networking can be integrated with other systems, such as ERP, and share data with other business units.
For example, due to inventory value may be an important part of the company's assets, inventory data is critical to the accounting department to ensure that the company's annual report and the payment of tax return are critical.
2
What are the benefits of the Internet of Things?
Inventory management based on the Internet of Things has laid a solid foundation for the digitalization of the ecosystem, and provides many benefits, including:
Inventory tracking and reporting automation
With RFID and industrial network, inventory management does not take time to track and report. Each project will be tracked, and the data related to it will automatically record in a large data warehouse. Automated asset tracking and reports saves 18 hours of working hours per month and reduces the possibility of human error.
Continuous visibility for the number, location and movement of the inventory project
Inventory management solutions based on the Internet of Things provide the manufacturer with raw materials and components, exact visibility in the product and finished production process by providing real-time updates of item status, location, and mobile, in order to view individual stocks. When entering or leaving a specific location.
Optimized inventory
The more the warehouse management personnel know the stock, the more likely it is possible to place the correct item in the correct position in the correct time. With real-time data of the number and location of the stock item, the manufacturer can reduce the amount of inventory while meeting the customer needs of the supply chain.
Identify bottleneck in operation
There is a real-time data of the location and quantity of the stock item, and the manufacturer can reveal the bottleneck in the production process and find a lower utilization. For example, if some inventories tend to accumulate before the machine, the manufacturer will consider that the machine is not fully utilized, so special attention is required.
Optimize delivery cycle
By providing warehouse managers with available stock quantities and machine learning-driven demand predictions, industrial network-based solutions can reduce delivery cycles for manufacturers. (Source Federation Home Network), for example: RFID-based inventory management solution allows ZARA to make one piece of clothes from design to manufactured and sent to smart warehouses in just 10 days.
3
What challenges and restrictions?
The use of RFID technology may be limited by the following factors:
Since the RFID tag can be attached to the items still processed, the manufacturer must ensure that the label does not affect the production process.
Although the RFID reader can scan most non-metallic materials, they may still be difficult to scan liquids and metals. However, special labels such as anti-metal, anticipants have appeared on the market.
The label price is from 5 percent to $ 10 per piece, and the price of the RFID reader is up to $ 3,000 to $ 2,000, including installation and configuration. Therefore, the price of the product should be high enough to allow the label and the reader to recover costs.
4
Summarize
Based on the Internet, RFID inventory management and asset tracking solutions provide continuous visibility for inventory by providing real-time information. It helps to track the precise position in the production process of the products and finished product production. Therefore, the manufacturer can balance the number of existing inventories, improve the machine utilization, and shorten the delivery cycle, thereby avoiding the implicit cost of the manual method of efficiency.
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