How The F&B Industry Can Cut Down On Food Waste With RFID
Food waste in the supply chain is one of the many issues that beset every organisation in the food and beverage industry. According to a McKinsey & Company report, the amount of food that gets lost globally just after or during the harvest period is estimated at approximately $600 billion. As such, it is easy to see why finding solutions to help supermarkets throw away less and curtail this issue is a top priority for many business owners.
One method quickly gaining traction is integrating the First Expired, First Out (FEFO) principle with an RFID asset tracking system. The FEFO inventory management principle is mainly used for perishable goods and other items where shelf life is a key concern. It ensures that those with the earliest expiration dates get sold or used first to guarantee freshness and reduce waste. Together, they form a powerful and highly effective way of managing perishable food materials and ensuring items get used in order of their expiry throughout the manufacturing process.
RFID’s Role in Enhancing FEFO Inventory Management
Organisations that combine the FEFO principle with RFID reap many advantages, and the following outlines how the technology works to streamline this type of inventory management:
1. Expiry data encoding
Upon reaching a warehouse or storage facility, new products will each receive a unique RFID tag. Alternatively, these tags may also be applied by product batches if they were made at the same time. Every label includes a unique identifier and can store essential data about the item they’re attached to, such as the expiration date. Once tagged, the perishables can then be more easily tracked and managed as it goes through manufacturing.
2. Real-time inventory management
RFID readers collect real-time data for processing by the inventory management system to continuously update the relevant databases. This makes sure the latter always provides an updated and highly accurate view of expiration dates, inventory levels, and product locations. Having such information readily available empowers businesses to efficiently manage their stocks and make sure items are used or shipped on time based on their expiration dates.
3. Prioritising near-expiry products
The biggest advantage of RFID integration with FEFO is being able to prioritise product usage according to their expiration dates. The RFID inventory management system uses the expiration date data stored on the RFID tags to organise products accordingly, such as when restocking shelves or fulfilling orders. In these instances, the system will put out the items that are closest to their expiry so they get picked first. Automating this process eliminates the potential for human error and maintains compliance with FEFO.
4. Proactive alerts and automation
Depending on the inventory management system and its features, it may be possible to set up proactive alerts based on RFID data. For instance, it could be programmed to send notifications whenever certain items are just a few days away from going bad, prompting timely usage or other actions such as selling them at a discount or giving them away to donations to avoid throwing them away.
A Summary of The Benefits of RFID and FEFO Integration
Investing in RFID and combining it with the FEFO principle leads to the following invaluable benefits:
1. Significantly reduced waste
By using RFID tags to track items based on their expiration dates, businesses can ensure that the oldest stock is used first, minimising the chances of products expiring in storage. This leads to a substantial reduction in waste, allowing companies to optimise their stock usage and lower costs associated with expired goods and often the environmental damage they cause.
2. Improved inventory control
RFID enables real-time tracking of inventory, providing a clear overview of stock levels and location. When paired with the FEFO principle, it ensures that businesses manage their stock more strategically, preventing overstocking or understocking issues and making inventory control more streamlined and efficient.
3. Maintain compliance and ensure traceability
Many industries, particularly food, pharmaceuticals, and healthcare, are subject to strict regulations regarding the tracking and traceability of products. RFID technology provides detailed data on product movement, storage conditions, and expiration dates, which enhances compliance with safety standards. With FEFO, companies can guarantee that products are distributed and used in accordance with regulatory requirements, ensuring consumer safety and transparency in the supply chain.
4. Enhanced efficiency
RFID’s ability to automate and speed up inventory management tasks—such as scanning, stock checks, and locating items—reduces manual labour and errors. This increased efficiency translates to faster order fulfilment, optimised stock rotation, and smoother day-to-day operations, particularly when managing products with limited shelf life.
5. Greater accuracy
By integrating RFID with FEFO, businesses can achieve higher accuracy in tracking expiration dates, stock levels, and product movement. Automated systems minimise human error, reducing the risk of using or shipping out-of-date products. This enhanced accuracy is crucial for maintaining quality control and meeting customer expectations, particularly in sectors where product freshness is paramount.
Conclusion
RFID plays a pivotal role in enhancing FEFO inventory management by providing real-time visibility, increased accuracy, and improved efficiency. By automating the tracking of expiration dates and stock movement, RFID ensures that perishable products are used or shipped in the correct order, reducing waste and optimising inventory control. Given its effectiveness, RFID will remain a valuable tool for maintaining the freshness, quality, and safety of products across various industries for years to come.
