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A comparison of RFID-based shelf replenishment policies in retail stores under suboptimal read rates

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  • Thiesse, Frédéric
  • Buckel, Thomas

Abstract

The use of Radio Frequency Identification (RFID) as a tool for improving shelf replenishment processes in stores has attracted the interest of several retailers. However, the performance of RFID-based inventory control policies is influenced by a variety of design choices, technology characteristics, and external influences. The present simulation study aims to analyze and discuss the impact that these factors exert on the economic efficiency of RFID. We consider policies for RFID tagging on both the item level and the case level and compare these to a traditional replenishment process using periodic reviews. Our model incorporates shelf stock information generated by RFID and accounts for imperfect read rates and technology-specific costs. Our results indicate that significantly different sensitivities to cost and time-related factors, demand rate, and read rate must be considered when choosing a particular policy. Moreover, we discuss the consequences of model extensions and additional constraints on process performance. The results support both researchers and practitioners in the modeling and implementation of RFID-based inventory control systems.

Suggested Citation

  • Thiesse, Frédéric & Buckel, Thomas, 2015. "A comparison of RFID-based shelf replenishment policies in retail stores under suboptimal read rates," International Journal of Production Economics, Elsevier, vol. 159(C), pages 126-136.
    • Handle: RePEc:eee:proeco:v:159:y:2015:i:c:p:126-136
    DOI: 10.1016/j.ijpe.2014.09.002
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    References listed on IDEAS

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    Cited by:

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    2. Marcel Papert & Alexander Pflaum, 2017. "Development of an Ecosystem Model for the Realization of Internet of Things (IoT) Services in Supply Chain Management," Electronic Markets, Springer;IIM University of St. Gallen, vol. 27(2), pages 175-189, May.
    3. Sanjeev Yadav & Sunil Luthra & Dixit Garg, 2022. "Internet of things (IoT) based coordination system in Agri-food supply chain: development of an efficient framework using DEMATEL-ISM," Operations Management Research, Springer, vol. 15(1), pages 1-27, June.
    4. Dai, Hongyan & Ge, Ling & Zhou, Weihua, 2015. "A design method for supply chain traceability systems with aligned interests," International Journal of Production Economics, Elsevier, vol. 170(PA), pages 14-24.
    5. Haines, Russell & Hough, Jill & Haines, Douglas, 2017. "A metacognitive perspective on decision making in supply chains: Revisiting the behavioral causes of the bullwhip effect," International Journal of Production Economics, Elsevier, vol. 184(C), pages 7-20.
    6. Biswal, Arun Kumar & Jenamani, Mamata & Kumar, Sri Krishna, 2020. "The impact of RFID adoption on donor subsidy through for-profit and not-for-profit newsvendor: Implications for Indian Public Distribution system," Socio-Economic Planning Sciences, Elsevier, vol. 69(C).
    7. Mou, Shandong & Robb, David J. & DeHoratius, Nicole, 2018. "Retail store operations: Literature review and research directions," European Journal of Operational Research, Elsevier, vol. 265(2), pages 399-422.

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