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How do I calculate ROI for RFID?

So far, there hasn't been any clear documented case of ROI from a company that deployed RFID technology across its supply chain.

The cost of RFID technology depends on which method you choose to implement in your supply chain. For those who just want to meet RFID compliance, the price tag will be cheaper. Of course, the total cost increases for suppliers who wish to further invest in the technology's capabilities—cleaning and analyzing all the data that will be stored in the RFID chips, for example.

One estimate from Wal-Mart put the cost of RFID implementation at $50,000 to $100,000 per location for the software alone. A study from Forrester Research put the price tag at $9 million for a typical supplier. And yet a 2004 study from Yankee Group estimated $40 million to enable the technology through a manufacturer's supply chain.

Still, is it possible to get ROI for RFID? Tom Pisello, CEO and founder of Alinean, explains here:

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Does RFID equal ROI?

Read more about RFID ROI:
Companies still seeking ROI in RFID

Click here for a webcast in which Accenture's Rick Simon talks about RFID strategies to realize near-term imperatives while targeting future high performance.
RFID Strategies for Mandate Compliance and Beyond


HOW TO BUILD A BUSINESS CASE FOR RFID

 Home: Introduction
 Getting started: What is RFID?
 Getting started: RFID evaluation: Can RFID technology work for you?
 Getting started: Determining the benefits of RFID for your business
 Getting started: Selecting the right RFID software vendor for your business needs
 Building the case: SAP and RFID: Incorporating RFID in ERP software
 Building the case: What other companies are implementing RFID technology?
 Building the case: What factors are holding up RFID adoption?
 Building the case: How do I calculate ROI for RFID?


This was first published in May 2006

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