This article aims to understand the impact of Radio Frequency Identification (RFID) technology on organized retailers' supply chain with special reference to its benefits and challenges. The research study conducted was empirical in nature, involving personal interviews with organized retailers. Analysis of the impact of RFID technology on supply chain strategy examines the benefits and challenges faced by the retailers. The results indicate that the application of RFID technology enables majority of retailers to have better inventory management, control over labor costs, track high-value items, reduce shrinkage, enable accurate recalls and improve customer service. The implementation of RFID technology was investigated in isolation, without considering the effect of other technological tools. Though the study is done in Bangalore, which is more prosperous than other regions, the research results cannot be generalized. As RFID technology application is in its nascent stage in India, the present study focuses on the challenges faced by the retailers. The paper concludes by proposing a framework to enable retailers with the change towards introducing RFID to enhance their supply chain efficiency. From a practical point of view, RFID calls for huge investments, but nevertheless enjoys substantial competitive advantage. The study enables us to understand the challenges faced in implementing RFID.

Advancement in technology has changed the way the big retailers are functioning today. Technology has become pivotal across all industries and efforts are made to use it optimally, rather than merely using it as a tool that must be actively employed. Vertical segment such as manufacturers, retailers, distributors consider Supply Chain Management (SCM) crucial for their business and the advent of Radio Frequency Identification (RFID) has been found to enhance the efficiency of the SCM process. Though RFID is one of the emerging technologies in retailers supply chain, there is no doubt in its acceptance as it carries a lot of vital information both for suppliers and retailers. Growth of electronic retailing in the form of bar code scanning, Global System for Mobile communications (GSM), adoption of RFID and other electronic gadgets have expedited the marketing function of majority of retail organizations. With RFID into action, it is possible to gain crucial information about customers and strategize the operations and structures. To practice SCM effectively, organizations have started adopting RFIDs to monitor and control information on real time basis. Though RFID technology was invented sixty years back, its RFID tag sales is still less. This also echoes that the usage rate is low and a very little percent is spent in retail segment. The adoption of RFID technology not only revolutionizes business but also has a broader impact on various operations of the retailers. To quote a few, the impact of RFID is seen in material handling, logistics, inventory tracking, manufacturing, cashless payment and customer service management. McGoldrick (2002) commented that any innovation in the field of communication and information technology, significantly impacts strategies of the company, its operations and inbuilt structures. Especially, internet connectivity and EPOS (Electronic Point of Sale and Systems) have facilitated and driven marketing strategies of several retailers. Some commentators argue that RFID technology enables retailers to gather real time intelligence information about their operations and in turn help in strategic planning and fundamentally reviewing the process.

Supply chain management involves combination of applications which are tightly integrated. Effective SCM has capabilities of producing planning solutions and help in taking strategic level decisions. Supply chain costs such as receiving, inventory, shrinkage, distribution, logistics delays, and out-of-stock merchandize are often cited as crucial for smooth functioning of the business. Information availability is pivotal in controlling costs thereby improving supply chain performance. RFID technology enables management to capture real time data and helps in taking good decisions. Early adopters of SCM with RFID have reported smaller inventories, faster response to market, lower procurement costs, shorter cycle times and reduction in forecasting errors. Wal-Mart reported 18% reduction in inventory level, followed by 20% in replenishment cycle, 32% increase in sales and 40% more accurate forecast after implementing RFID in their operations.

Supply Chain Management Journal, Radio Frequency Identification, RFID, Indian Retailers, Inventory Management, Supply Chain Management, SCM, Marketing Strategies, Marketing Function, Customer Service Management, Stock Management, Research Methodology, Factor Analysis, Strategic Decision-Making Process.