Shrinkage reduction in perishable food supply chain by means of an RFID-based FIFO management policy

Abstract

The objective of this paper is to point out how Radio Frequency Identification (RFID) technology can be used to improve the First In First Out (FIFO) policy of fresh products warehouses in the large-scale retail channel. The relatively short shelf life of fresh products forces to maintain a punctual control of the rotation of cases in the warehouse. The implementation of an RFID system enables to real time monitor the supply chain processes an item is subject to; in particular, the present work focuses on the process of shelf replenishment, by moving cases from the backroom to the shop floor. By means of an accurate monitoring of this process, the errors caused by noncompliance with the FIFO policy were pointed out, and the economic savings resulting from the use of RFID technology in that context were evaluated. Results show that the deployment of RFID technology has potential to help manage the FIFO policy of fresh products, thus generating interesting savings for the food supply chain.