BearingPoint, Inc., McLean, Va., a consulting and systems integration firm, announced the results of a demonstration program
, which found that using RFID (Radio Frequency Identification) sensors to improve cargo security also resulted in savings for importers.
The program involved containers shipped from Thailand during September and October of 2003.
The project affixed RFID sensor seals, also known as e-seals, to conventional bolt locks on standard 40-foot containers at the point of origin. The containers were then transported by truck or rail to Laem Chabang, Thailand, and loaded on ships destined for the United States. The containers were tracked through ports in Taiwan and Korea, and on to the Port of Seattle, using a real-time, Web-enabled software application developed by Savi Technology, the project's prime contractor.
After arriving at the Port of Seattle terminals, the containers were discharged from the ships and the e-seals checked before the containers left the premises. Next, they were sent to their final destination point, where operators with hand-held computers verified the containers' origin and contents. Once verified, receivers used the hand-held computers to unlock the seals so the container contents could be removed.
BearingPoint's cost-benefit analysis found that companies importing goods into the United States could realize financial benefits by utilizing RFID technology to secure, track, and manage their supply chains.
According to the report, benefits include:
-- Improved visibility, predictability and timeliness of cargo shipments
-- Reduced costs related to emerging U.S. Custom's trade security measures Reduced safety stock and inventory carrying costs
-- Improved customer service to sales channels and re-sellers
-- Improved in-stock product rates
-- Reduced theft and pilferage
The report found that the financial benefits from the added security were dependent on the value of the goods being shipped. Adjusted for uncertainty and risk, there is an 80% probability that the benefits cited above will exceed $220 per container, according to the report. The report also predicted that these benefits would increase dramatically as system utilization grows and additional trade routes are added.
BearingPoint's Global Trade Management Practice conducted the analysis on behalf of the U.S. Trade and Development Agency, which funded the project.
For more information visit www.bearingpoint.com.