NFC in Supply Chain.

It is undoubted that the usage of RFIDs have revolutionized supply chain management strategies and how information is passed upstream and downstream in the supply chain. However the adoption of RFID has not really taken off beyond the point of sale. One area where RFIDs could not really take off is at the consumer point. In practice, currently there is no scalable technical solution that can enable this. However all of this might change with the rise of NFC (subset of RFID technology) enabled devices (smart phones) in the hands of consumers owing to its lower costs and a faster transaction speed. 

Near field communication (NFC) is a close range RFID technology, meant for near to or physical touch applications to maintain security. NFC is for smartphones and similar devices which establish radio communication with each other. It uses electromagnetic radio fields instead of radio transmissions as used by technologies like blue tooth” ¹.  NFC usage is about to take off, and it will change the way we conduct business and make payments or collect information. This is evident by that fact that, 168 million NFC-enabled handsets will be shipped in 2012 (According to HIS iSuppli).

NFC has a very powerful yet simple user interface. NFC technology has a short readability range. It can be used in a supply chain to track and share inventory information.  “For instance, a delivery driver would only need to tap a smartphone against a pallet of inventory and the shipment information would be instantly ready to be sent to a customer or back to the distribution center. This technology could be used to lower the percentage of inventory errors and track products and equipment along a supply chain.” ^2. Imagine NFC collecting and feeding back the information related to usage of groceries to online stores in order to trigger automatic purchases. NFC enables sensing and detection capabilities to individual customers at a scale that has not been possible previously. There is a possibility that 5 years from now, wallets might be replaced by NFC technology. It would be really interesting to see how this technology evolves. 

What other benefits can NFC enable that old RFID technology could not (for supply chain)? What do you think are the biggest challenges for widespread NFC adoption?

References :

1) http://juniperinnovations.co.uk/2011/is-there-a-future-for-nfc-devices-in-the-supply-chain

2) http://www.genco.com/resources/logistics-article.php?aid=800509228