How we build the RFID Business Case

A ‘tag first’ approach – as we see regularly in the requests we receive – i.e. looking at tag cost first then to capability, trying to force-fit them into operations – is not advisable. Instead, RFIDdirect approaches any RFID application from a business process perspective, identifying points of data capture within the process, Classifying the data to be communicated and acted on.

Before deciding which AIDC (Automatic Identification and Data Capture) solution is the best answer to your application, we argue that a schematic overview of your organisation’s process flow is essential. This can consist of a complete production process, but also any sub-process therein. Also, the exploration of whether current data capture practices be combined or enhanced by RFID technology?

Process flow analysis

We start by completing a full scoping of each process, the data that is collected at each individual point in the process flow, how this data is captured and processed in the organisation. This provides the arguments how current data capture can be improved and what positiveimpacts this will have on the process and procedures.

The most common objective when building a business case is product establishing traceability through a process.

  • component supply just in time – visibility what is in the supply line, can be complex due to many third parties 
  • up to date inventory status, and location, status of product 
  • reduce working capital from overstocking 
  • when more efficient handling of production capacity is demanded  
  • reducing manual data capture, re-typing of data, manual transferring datasheets 
  • reduce exception checking & compensation pay-outs 
  • reduction in lost equipment & complaints 

Potential problems

Potential issues or barriers that may arise can be that materials in the objects/assets to be identified, the environment can have influence on your chosen data capture technology, metal and liquids also have a negative influence on the RFID signal and require special more expensive tags/labels. The physical format of the tags/labels can vary, and so does the choice of technical specifications inside the label/tag.

We say, ‘Why does a carpenter has a toolbox with different tools? That the enormous range of nails and screws etc. will in fact, deliver the correct functioning solution. This goes for RFID absolutely, we recommend always request advice from a trained, specialist supplier.

Another important decision is the read range of the data carriers to make real efficiency improvements, and the number of data carriers in the reading area required at the same time interval.

How much is a typical RFID application likely to cost?

Projection of costs for an implementation are variable as they are not only limited to the costings of the consumables used, but also include the hardware plus installation costs, potentially upgrading the LAN or WLAN network, software development, work instruction-sets and procedures, in addition to the training, after-sales support of staff. Additionally, don’t forget to calculate the label or tag fitting time and therefore added costs of the consumables; adding manually 1 million labels to individual objects, each taking 3 seconds, is still 833 working hours and thus a cost!


The above collated information analysis and test results will lead to a realistic decision about which technology and where can best to deploy.

  • May result in solution as a combination of barcode and RFID, or a single technology – reducing costs or a stand-alone system from RFIDdirect
  • Value and more significantly, ROI payback – depends on the systems working together for your business to achieve measurable operational improvements
  •  Additional linked software can add potential to generate future added value

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