Inventory Managers are Being Replaced by RFID-Mounted Drones

Military drones, sheep herding drones, delivery drones—a lot of game-changing tech has emerged out of the recent drone boom. And it's only beginning. Now, drones are being outfitted with radio frequency identification (RFID) to help businesses track inventory.

Picture this. A few times a week, a sales manager grabs a clipboard and walks around a car lot to see what is on the ground. That information is then entered into a computer and managed through an auto dealer's software, which maintains data on everything from the car model, to price, and market value.

That's the old way of taking inventory, and it is time-consuming and inefficient.

Now, with the advent of drones, a fleet of airborne assistants can automate the drab inventory process. These drones whiz through outdoor yards to collect information about what items are available, and where.

AGE Steel, a supplier in the United Arab Emirates, started using RFID drones in 2015 to locate pipes, coils, hot-rolled bars, and plates. Since then, according to managing director Asim Siddiqui, its ability to locate items in a 950,000-square-foot outdoor lot "jumped from around 70 percent to 99.8 percent."

"Our main issue was matching the system's inventory to the physical inventory," Siddiqui told me, speaking over the phone from his office in Dubai. "Often times, our computers would show that we have a particular part, but we couldn't locate it when we needed it."

Locating items more quickly means it can them send out faster, too. The average loading time decreased from nine minutes to around four minutes after the RFID tag reader was introduced, according to Siddiqui.

The AGE Steel drones were created by Exponent Technology Services, a UAE-based company that also has an office in Montreal. Its model mounts an RFID reader on a small, unmanned aerial vehicle. The RFID-equipped drone flies above goods, which are marked with active RFID tags, and collects data.

The drones are functional in up to -35°C, making them capable of weathering a harsh Canadian winter—and torrid desert heat. Maroun Hannoush, CEO of Exponent North America, says this technology could transform the steel, oil and gas, lumber, retail, transport and construction, which are all big business here in Canada.

According to Hannoush, who is based in Montreal, inventory problems are common in a number of industries. "One American transport company told us that they have had cases where inventory is loaded onto the wrong truck, and what is supposed to leave California for Florida ends up in Texas. Things get misplaced all the time. These kinds of errors cost companies a huge amount of time and money."

So just how much does it cost to purchase your very own flying robot? Hannoush says the cost can vary for different jobs in different industries.Each drone is "uniquely designed" for the buyer. The price varies according to "how many products require scanning, how often the customer needs the item scanned, the distance between each item," as well as a number of other factors, he said.

Some are skeptical that RFID-outfitted drones are the way of the future.

Michael Carmichael, president of City Buick Chevrolet Cadillac GMC and regional vice president of the Humberview Group, one of the largest auto groups in Canada, says that for the auto industry, inventory management is critical because "used car inventory is perishable as it ages."

While a solution to speed up the dull and time-consuming inventory process sounds ideal, Carmichael says it's not that simple. As a business, there is a lot to consider: "Will I have to replace the drone every six months? Can it truly handle a Canadian winter? Do we have to keep the cars completely clear of debris or snow? Because I know if I send my auditor out, he will touch every car and he will scrape off the car to check the VIN."

ADASA, an Oregon startup, has been developing its own RFID tag-reading drones. Founder Clarke McAllister said the goal is to "have push button inventory which is to know exactly what you have in store at any time."

Both Exponent and ADASA only offer outdoor models for now, but they say they are working on an indoor one. The Fraunhofer Institute for Material Flow and Logistics in Germany has also been working on a project that would overhaul the way inventory is tracked inside warehouses. InventAIRy's goal is to create "flying inventory assistants" to replace people having to walk around and collect information about what's in stock.

Whether or not RFID drones become the norm in Canada, Carmichael believes that "precise inventory management" is the key to growth for a business. "In the old days, you just put a sales tag on a car and waited for someone to buy it. That day is gone."