Alibaba Group Holding’s logistics arm Cainiao has sold over 100 million radio frequency identification (RFID) tags in less than two years since it their launch in April 2021.
RFID is the third generation of identification technology after barcodes and QR codes and facilitates the transmission of data stored in a microchip through radio frequency signals. At present, it is mostly used in logistics scenarios such as inventory management within the supply chain, inbound and outbound deliveries, and full-link tracing. Globally, the RFID market was valued at US$11.8bn in 2021 and is projected to reach US$31.5bn by 2031, a CAGR of 10.2% from 2022 to 2031.
To ensure accuracy, Cainiao has optimized the RFID tags, readers and identification algorithms, which in turn enables a larger-scale commercial application of RFID technology in logistics and supply chains. The company developed customized RFID tags that displayed improved identification sensitivity, especially in challenging scenarios involving metals and liquids.
Following this technological breakthrough, Cainiao tailored industry-specific solutions catering to sectors such as fashion, food and logistics to better support business supply chain management. For example, when applied in the food industry, RFID tags can be embedded in cartons to increase supply chain visibility and allow businesses to make dynamic decisions based on real-time data and analysis. Similarly, in the fashion industry characterized by thousands of SKUs, businesses face pressures in inventory management especially ahead of large shopping festivals. Here, Cainiao empower businesses with supply chain digitalization and full-chain visualization from factories to warehouses and stores.
Dr Ding Hongwei, vice president of Cainiao Network, said, “Internet of Things (IoT) has permeated a range of industries, and we believe that the large-scale application of Cainiao’s RFID technology will help to drive logistics and supply chain digitalization. By adopting a data-driven approach to operations and decision making, businesses will benefit from greater improvements in time and cost efficiencies. Currently, the market application of RFID is still in its infancy, and we strive to continue our endeavor to refine its core technology and enhance the advantages of RFID products and solutions in order to drive the overall digital transformation across industries.”
He added, “In the past, it would often take employees up to three days to conduct store inventory checks, but with RFID technology, it only takes half an hour to complete using a RFID handheld device. This not only improves efficiencies and accuracy but also reduces human errors. With RFID technology, consumers can also self-checkout, enhancing the consumer experience.”
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