Perishable Products Supply Chain Inventory Management Based On Rfid Technology

Supply chain management is an important trend of enterprises' operation andmanagement now. Along with the deeper research on supply chain management andmore mature application based on all kinds of technologies, product lifecycle becomesshorter and shorter, the research on supply chain management also trends to changefrom pushing supply chain to pulling supply chain, and there is a research on supplychain management considering a combination between pushing supply chain andpulling supply chain. Under this circumstance, there is a special kink of product, whichis called perishable product, compared with common product, it will lose its value alongwith time goes more easily. When E-commerce steps into improving the mode of supplychain management and the revenue management research on perishable product goesmore deeply, a rising technology named radio frequency identification (RFID) plays arevolutionary role in helping perishable product adapt to this change. RFID technologymakes the whole supply chain management to be transparent, improves the harmony ofvarious segments of supply chain, and significantly increases their revenues, especially,in perishable inventory management.Revenue management as an advanced management method is very effective tomanage perishable product. Its core content is selling right product to right customerwith right price at right time. Nowadays, domestic and overseas scholars' researches onproduct selling time, selling quantity and selling price in revenue management havesome problems, mainly due to, the transparence problem of supply chain hasn't beenpractically solved. At the same time, RFID technology's powerful functions of datacollection, storage and disposal, can make the whole supply chain to be thoroughlytransparent, and make the decision process of product's selling time, selling quantityand selling price to become easier and more exact. This paper tries to flexibly combine revenue management theory with RFID technology in order to research on how toeffectively manage perishable inventory under supply chain circumstance.First of all, RFID technology uses its powerful functions of data collection, storageand disposal in various segments of supply chain, achieves to monitor all segments ofsupply chain in a real time, from product design, material supply, semi-manufacturedproduct and manufactured product's production, storage, distribution, transportation toretail, even more after service, makes the whole supply chain management to betransparent, improves the operation processes of various segments in supply chain.Next, this paper establishes an architecture based on RFID technology to manageperishable inventory. In this architecture, various segments and members of supplychain are tightly connected together by manufacturer, RFID tag identifies and tracksproducts in various segments of supply chain, from the supply of material supplier tofinal retail.Thirdly, this paper expounds the core algorithm of central processing unit in thisarchitecture, which is called the algorithm of fixed-life perishable inventorymanagement under price promotion, this algorithm makes it possible to determineoptimal order quantity and price promotion decision for perishable product. A newapproximation algorithm is proposed, which produces results close to the optimal, whilereducing the complexity of original algorithm. Application of RFID technology makesthis model to be used widely, and significantly increases enterprises' tangible revenues.In the end, this paper simply discusses some crucial problems of applying RFIDtechnology under supply chain circumstance. RFID technology is revenuemanagement's powerful support, so it's very necessary to regard and discuss theseproblems.