An Autonomous Inventory Replenishment System through Real-Time Visibility and Collaboration based on IOT and RFID Technology

Abstract

Supply chains consist of interconnected nodes where the movement of materials is dictated by the exchange of information. The more effectively each node gathers and disseminates information to its upstream and downstream partners, the more efficient the material flows become, hence enhancing the efficiency of the supply chains. An essential method for analyzing a supply chain is to concentrate on how inventory meets demand at each point. Insufficient supply leads to lost sales and reduced customer satisfaction, potentially driving customers to seek alternatives, resulting in future lost sales. Therefore, firms are embracing technologies like IoT and RFID to gather data and facilitate more efficient sharing, resulting in improved information and material flow. Data sharing boosts visibility, hence fostering collaboration among supply chain partners. Certain studies in the literature have employed IoT and RFID technology to enhance inventory visibility, while others opt to share the gathered data with their partners to improve inventory replenishment efficiency. Nevertheless, this paper presents an autonomous inventory replenishment system that utilizes IoT technologies to replenish inventory through real-time visibility and collaboration. The system facilitates the sharing of real-time data, such as inventory levels, with supply chain partners. Additionally, it enables automatic collaboration by allowing partners to take action based on the shared data, such as activating orders to replenish inventories at various points in the supply chain. To assess the suggested approach, we conducted an inventory replenishment simulation, comparing it to previous studies in terms of the amount of lost sales incurred when confronted with unpredictable demand. Across the 3 utilized datasets, the proposed approach demonstrated a 22.9% reduction in lost revenue compared to its nearest competition. These findings demonstrate a direct correlation between the utilization of technology in inventory replenishment processes and the speed at which inventory is refilled, as well as the reduction in lost sales.