The concept of Vendor Managed Inventory can be considered a subset of Replenishment. In those situations when a supplier provides inventory on consignment to a retailer.

Barcodes are used more commonly in the world today to identify products or containers of products (such as pallets or cartons). In transportation and distribution, Advance Shipping Notices and compliance labeling are commonly paired to assist in the identification and trafficking of products in the supply chain.

Pallets and/or cartons are scanned into and out of each facility. ASN’s are generated from these scans and shared between source and destination facilities. However, these barcodes must be scanned individually and must be visible from the outside. Many times material handlers need to walk around a pallet or re-orient a carton to get to the barcode. Under this scenario you must depend upon each material handler to ensure no barcode goes un-scanned.

RFID technology provides the capability of automating the reading of pallets as they arrive without requiring direct human intervention. The time it takes to stage, find the barcode and scan it, are eliminated thus streamlining the process.

Automating the scan of pallets/cartons arriving in a facility increase the visibility of how much stock is physically in the building. Gaps in time between product arriving and product being scanned are eliminated. More timely awareness of what is on hand can prevent the reorder of product before it truly is necessary.

As product is sold and cartons emptied the tags on these cartons may be read at the shelf or a disposal point. This action can then be used to signify that inventory has been depleted of a carton of product. If this depletion falls below the reorder point it could trigger a reorder of that product. As a result the need to have the vendor count inventory on a regular basis may be reduced dramatically or eliminated.