Despite technological advances in supply chain management, it's estimated that as much as $45 billion worth of inventory is lost in retail supply chains at any given moment, and the Food and Drug Administration claims that up to 20% of foods spoil in transit each year. These statistics exclude the impact of counterfeit products, which cost companies more than $100 billion a year. All of this means that while supply chain management is relatively invisible to most of us, it's obviously a high visibility issue for retailers striving to remain competitive.
Enter RFID. Radio Frequency Identification, or RFID, offers a solution to many of the retail industry's supply chain problems. Already, companies such as Wal-Mart
A study done by Hewlett-Packard
Of course, this wonderful vision is more theory than practice at the moment. Large investments in database technology and information systems, as well as new production techniques to lower RFID implementation costs, will be necessary. Supplying RFID solutions is quickly becoming a crowded marketplace, driven by mandates from Wal-Mart, the Department of Defense, and others. Big companies such as HP and IBM
Mixed first-quarter results from some highly visible RFID suppliers underscores how difficult it is to predict success, or failure, at this early stage. Zebra Technologies
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Fool contributor Chris Mallon owns shares of Home Depot but none of the other companies mentioned.