Sustainable development of the fresh agricultural products supply chain through the application of RFID technology

Abstract

This study discusses the sustainable development of a fresh agricultural product (FAP) supply chain, which consists of one manufacturer and one retailer, from the perspective of supply chain coordination. The study includes a centralized FAP supply chain, a decentralized FAP supply chain, and a decentralized FAP supply chain under a "revenue-sharing" contract. The study also establishes the profit models of the three FAP supply chains before and after investment in the radio-frequency identification (RFID) technique. Afterwards, the models are compared and the critical values of the cost of the RFID tags are calculated. Finally, the sustainable development of the FAP supply chain is obtained. The revenue-sharing contract facilitates the coordination of the FAP supply chain. In addition, RFID technology application can reduce the loss rate of FAP transportation as well as increase the production cost of FAP and the utilization rate of RFID tag recycling. Furthermore, the RFID technology application itself can be simplified in the future. The more significant these three changes are, the greater the willingness of companies in the FAP supply chain to invest in RFID.