Advances in Internet of Things, 2013, 3, 79-85
http://dx.doi.org/10.4236/ait.2013.34011 Published Online October 2013 (http://www.scirp.org/journal/ait)
Cloud Computing Solution and Services for RFID Based
Supply Chain Management
S. M. Khalid Jamal1*, A. Omer1, Asiya Abdus Salam Qureshi2
1Department of Compu t e r Scie nce, UBIT, University of Karachi, Karachi City, Pakistan
2Department of Compu t e r Scie nce and Software En gi n e e r in g , University of Hail, Hai l, KSA
Received July 31, 2013; revised September 5, 2013; accepted September 23, 2013
Copyright © 2013 S. M. Khalid Jamal et al. This is an open access article distributed under the Creative Commons Attribution Li-
cense, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
ABSTRACT
Deploying and Implementing RFID Systems for tracking and controlling products in supply chain management is not
affordable for small and midsized companies due to its complexity, cost, and difficulties pertaining data management
and maintenance. Cloud computing can be used to mitigate the risks associated with the implementation and deploy-
ment of RFID based on system in su pply chain management because the complex system for data filtering, management
and maintenance can be implemented on the cloud that otherwise requires the purchase of new hardware, staff and pro-
fessional services.
Keywords: Cloud Computing; RFID; Tags; Readers; Barcodes
1. Introduction
Radio Frequency Identification (RFID) is a prevailing
technology that uses radio waves to monitor and control
the products in supply chain management. Each product
has a tag affixed to it during manufacturing process
which contains a unique identifier that can be used to
uniquely identify a product by all supply chain partici-
pants. The deployment as well as implementation of
RFID systems has been a challenging task for small and
medium sized enterprises (SMEs). In this paper, we pro-
pose cloud computing solution to overcome these chal-
lenges. The supply chains can install RFID solution
much faster by using the cloud implementation while
avoiding many of the expensive infrastructure cost re-
quired for pre-cloud systems.
RFID technology has been introduced across a range
of industries, including public sector as well as inretail
and manufacturing. For example, RFID has been used by
Harley-Davidson and Toyota to monitor parts for their
motorcycles and automobiles, respectively. Furthermore,
baggage at Las Vegas Airport is tagged to enhance and
improve loading procedures as well as the tracking of
passengers’ baggage. The US Department of Defense
and Wal-Mart hosted RFID technology a decade ago, and
required their suppliers to make all supplies RFID en-
abled, in order to ease its inventory management. For
organizations of all types, the ability to quickly locate
and enumerate products may facilitate business value of
supply chain management [1].
Small and midsized companies are unable to afford the
costs and risks associated with the implementation and
deployment of RFID systems. Therefore, we propose a
cloud computing solution so that the capital investment
and the return-on-investment risks associated with the
new technology of RFID can be mitigated. Cloud-base
services are designed in such a way as to eliminate the
hardware and software infrastructure requirements whose
implementation is time consuming as well as expensive.
Moreover, it provides abstraction to its users by hiding
all the complex details of the system. Users can only use
the provided services by interacting with application
software responsible for receiving inputs and providing
outputs. The inner workings are completely invisible [2].
1.1. Motivation
According to an estimate, the annual savings of US lead-
ing retail Wal-Mart using RFID are $8.35 billion. This
huge amount is divided as follows: it saves $600 million
by meeting timely deliv ery of goods due to real-time and
rapid information that RFID systems provide; inventory
shrinkage saves $180 million; $575 million are saved by
controlled tracking and monitoring of the products that
*Corresponding a uthor.
C
opyright © 2013 SciRes. AIT

S. M. K. JAMAL ET AL. 80
prevents theft, mistakes and buyer fraud; pallets and the
need to scan each product individually which reduces the
labor cost as well as time. By implementing RFID, the
total of $3 billion annual investment is made by Wal-
Mart as opposed to $8.35 billion made earlier. The an-
nual savings in different heads are represented in the Bar-
Graph 1.
Due to its speed, accuracy and improved inventory
management, RFID technology has been widely adopted
and recognized as an emerging and affective technology
in industry and businesses. An RFID system is made of
up to following three arrangements:
 An RF subsystem, which uses wireless communica-
tion of RFID tags and readers to perform wirelessi-
dentification of tagged items over a network [3].
 An enterprise subsystem, that stores, processes and
manages the data received from the RF subsystem
through software applications designed for this pur-
pose and that makes the RFID data more powerful.
 An inter-enterprise subsystem, through which multi-
ple enterprise subsystems are connected in order to
share information among supply chain networks [4].
All RFID systems have an RF subsystem where the
tags are read in and almost all RFID systems also in-
clude some form of an enterprise subsystem. An in-
ter-enterprise subsystem is used when the information
needs to be shared across the enterprise boundaries.
Graph 1. Annual savings by Wal-Mart in different heads.
The RF subsystem is composed of two basic compo-
nents in order to iden tify the tagged items.
 RFID tags also called transponders are small elec-
tronic chips that are either attached to items or em-
bedded within them. All tags can be uniquely identi-
fied by an identifier assigned to them. These devices
may have their own storage space containing addi-
tional information about the tagged item and sensors
attached to them to monitor temperature for example
or other environmental and status conditions.
 RFID readers are dev ices that are used to retrieve the i n-
formation stored on RFID tags and i dentify each tag uni-
quely by wirelessly communicating wit h the tags [5].
Tags can be active, having their own source for power
supply or passive, depending upon the RFID reader to
supply the power necessary to transmit signals. The sig-
nal can be a simple identification number, or a complex
data stream stored in the tag’s memory. These tags can
contain information such as the expiry date, date of
manufacturing, built in sensors to track temperature or
other data [6] .
1.2. RFID in Supply Chain Management
The most data rich and intensive RFID application is the
supply chain management systems in which a tagged
product is tracked from manufacture to final purchase,
throughout its life cycle. In addition to pro cess data, data
information is also maintained in these systems, such as
the formats in which it is stored and transmitted by the
supply chain in various organizations and the database
network addresses that contains data about different
tagged items.
Supply chain management is also used in monitoring
and product control from manufacture to retail sail in-
cluding its distribution. It is typically a collection of dif-
ferent kind of application types, which includes asset
management, process control and tracking and payment
systems.
In supply chain systems, the information about the
product can be stored at every phase in the supply chain.
Tags are attached to products during manufacturing proc-
ess or soon after it to these products in id eal situation. As
the product progresses through the supply chain, the in-
formation on these tags can be altered by the supply
chain participants. Moreover, larger objects such as pal-
lets and containers can be tracked and monitored by these
systems using active tags. These tags which are affixed
on the pallets can store information about the items
shipped in each of the container. When the products are
moved out from the container the information which the
tags carry are automatically upgraded to reflect the new
information. An electronic history is also generated for
each item in the container which ensures the buyers
about the item’s freshness, enabling them to identify

S. M. K. JAMAL ET AL. 81
whether it’s useful, has expired or not [7].
Objects are automatically identified with the help of
fully utilized EPC data. It can also be used in monitoring
location and movement, and trigger events. Operational
efficiencies could be gained by a near real-time view
throughout th e supply chain, such as improved inventor y
control, increasing throughput and lowering cost of the
products [8] .
1.3. Benefits of Using RFID
 Time spent in ordering products is minimized.
 Less number of employees required for inventory
control.
 Manual entries in the inventory document might be-
come prone to errors, whereas using RFID technology
the entries are automatic and hence more accurate.
 Sales reports are created automatically.
 Overstocking in warehouses is minimized.
 Forecasting the demand for products can be per-
formed more accurately because real time data is used
for estimation of demand.
 Improved communication between suppliers and cus-
tomers.
 Reduction in costs for labor needed for database
management in inventory.
1.4. Electronic Product Code (EPC)
The Electronic Product Code (EPC) is a unique identifier
stored on the tag that can be used to retrieve more infor-
mation about the tagged item from a database. EPC is
standardized by EPCglobal (a non-profit organization)
and acts as a replacement to UPC (Universal Product
Code) numbers when barcodes are used as identifiers on
products. However, unlike UPC barcodes that refer to a
class of products, EPC refer to a specific instance of
product. A unique EPC serial code that is sav ed in th e tag
is transferred back to the reader when an EPC tag is read
by RFID reader. The product is identified through inter-
net using the facility of Object Naming Service (ONS).
The ONS matches the specific EPC code to the corre-
sponding entry on the internet that provides additional
information about the product. EPC Information Services
(EPCIS) are then used to communicate available infor-
mation in real time via EPCglobal Network. The real
time data that is exchanged on EPCglobal Network al-
lows for the tracking and monitoring of products. Unlike
the identification of classes of products as with barcodes,
EPC allows us to uniquely identify an instance of a
tagged product. A serial number embedded within the
EPC is used to uniquely identify a tagged product. The
set of EPCs within the domain of a person is referred to
as his “EPC cloud”. This EPC cloud can be used to
monitor thefts within the supply chain [9].
2. Challenges Faced in RFID
Implementation
One of the major challenges in RFID implementation is
the high cost associated with its implementation. This
includes the cost of installation of the new hardware and
software as well as the hiring of new staff for profes-
sional services required for the integration of the new
system. According to an estimate, an RFID-enabled
warehouse would cost in excess of $2 million which
makes it unsuitable, especially for Small and Medium
sized Enterprises (SMEs), to implement a fully-fledged
RFID system.
Another challenge is the lack of understanding of
RFID technology and the approaches required to inte-
grate the RFID technology into the current IT infrastruc-
ture. Capturing, exchanging and managing data from
RFID readers and integrating the data into EPCIS and
sharing data among enterprises can become a challenging
task. This makes the deployment and maintenance of
RFID systems a time consuming and complex operation.
According to a survey, two-thirds of all respondents said
they are still learning about the technology; while 26.3
percent said they have an intermediate level of knowl-
edge. The automotive industry recorded a slightly higher
level of intermediate knowledge, at 33 p ercent, while the
transportation market, at 28 percent, was slightly higher
than the average for all industries. Therefore, the low
awareness and lack of understanding of RFID systems
among stakeholders is a critical factor preventing its
adoption [10].
Another problem in RFID implementation is the heav y
volumes of data that it generates that are hard to handle.
According to an estimate, Wal-Mart produces 7 terabytes
of operational RFID data per day. Moreover, supply
chain monitoring and real time tracking requires storing
additional data that the traditionally designed databases
cannot manage. This implies additional hardware costs
needed to manage the large volumes of data generated by
RFID systems. According to an estimate, RFID based
solutions and services are expected to be adopted over
the next 18 - 24 months due to the prevailing acceptance
of cloud computing [11].
3. Proposed Cloud Computing
Implementation
Cloud computing is a prevailing technology in which
computing infrastructure, hardware, software and ser-
vices are provided wherever and whenever needed. With
the proposed cloud computing architecture shown in
Figure 1, data from the scanning system is provided to
the EPC Information System that is implemented on
cloud as SaaS (Software as a Service). The transmitted
ata is stored and managed on the cloud and is made d

S. M. K. JAMAL ET AL. 82
Figure 1. Cloud-based architecture.
available in a reliable manner to any application that re-
quests it. The proposed cloud computing architecture
sufficiently reduces the maintenance and support cost,
which is one of the implementation barriers, while in-
creasing overall system consistency and flexibility. Sup-
ply chains can now deploy RFID much faster while re-
ducing the time consumption and complexity of the
newly deployed system. Furthermore, the EPC Informa-
tion System can also be used to implement additional
functionality such as data warehousing.
ated. Whenever an RFID tag appears within the range of
RFID reader, RFID data is produced. The data that is
acquired by the RFID reader is then sent to the front-end
software application containing the user interface and
application program connecting the front-end and the
back-end layers in order to gain access to more services
and information that are stored and processed on the
Cloud. Since, RFID systems generate huge amount of
new data specially from sensor based active tags sending
data through cellular network, this data needs to filtered,
stored and processed before being used. A Cloud com-
puting backend-end layer is used in order to achieve all
of these objectives that is connected to front-end layer
over a network. The cloud helps supply chains to manage
heavy volumes of data. In addition, there are numerous
advantages achieved by supply chain operators and cus-
tomers which include the reduction in IT cost, removal of
the costly infrastructure necessities, elimination of the
complex technology, professional services and software
updates required leading to faster path to return on in-
3.1. Front-End Layer
The front-end portion of the proposed architecture in-
cludes the hardware implementation of RFID tags and
readers over a network, the computers with sufficient
capabilities for data storage and management as well as
the front end software applicatio n that links the p roduced
data with the cloud computing system. The front end
begins to work when RFID tags and reader communicate
over a network as a result of which RFID data is gener-

S. M. K. JAMAL ET AL. 83
vestment.
All the read EPCs are fed into the scanning system,
that will search for those EPCs in Object Naming Service
(ONS) and acquires the required information through
EPCIS (EPC Information System) implemented on Cloud.
The scanning system may be installed for example at a
retail store’s exit to scan all the products the customer
purchases and the products that customer already had
with him before purchase of new products. Since, EPCs
are affixed within the product they need not be scanned
individually as with barcodes and as EPC network stores
information about individual products, these EPCs depict
consumer habits and contribute to the business value.
The cloud-based architecture allows the IT staff to con-
centrate more on other projects rather than dedicating a
significant amount of time on RFID deployment and
management.
3.2. Enterprise Sub-System
The enterprise subsystem provides a communication pat h-
way for RFID readers and the computers that are running
the front end application. The data obtained from RF
subsystem is stored, processed and managed on these
computers. For example, a retail garments store may
have RFID system installed in which a unique identifier
is read through RFID readers that uniquely identifies the
product. The enterprise subsystem acts as a middleware
that matches the identifier to the product’s record stored
in the database. The database records information about
the product such as its price, the brand name or the
manufacturing date. The proposed architecture consists
of two layers the front-end layer composed of the scan-
ning system and the hardware implementation of tags
and readers, and the back-end layer containing EPCIS
over Cloud [12].
3.3. Back-End Layer
The proposed cloud computing architecture (presented in
Figure 1) contains back end layer which includes EPC
Information System, data storage systems, computers and
servers. The Cloud filters the data from RFID depending
upon a particular application of interest. Th is filtered data
uses the required SaaS services on the Cloud and is then
stored on a specific server. The cloud computing system
includes the relevant protocols and middleware that al-
low the networked resources, including RFID tags and
readers, to communicate with each other.
The system traffic and system is managed by a server.
Since RFID systems produce a huge amount of data, a lot
of storage space is needed in the cloud computing system
to store all the relevant information. Therefore, a copy of
all RFID information is stored on the Cloud computing
system. These copies are stored on backup machines and
the backup data can be retrieved by the central server
thus providing backup and restoration facility that was
not otherwise available on traditional systems. The huge
amount of data which was lost earlier at initial stages
because of bearing low priority due to lack of storage
space and available hardware may now be preserved and
managed on the cloud to depict more intense business
decisions as a result of using cloud computing. Moreover,
the existing resources can be more efficiently utilized
instead of demanding a need for new services and infra-
structure deployment. Cloud based RFID system pro-
vides real-time data and powerful software tools. Typi-
cally the cloud offers its users additional functionalities
such as warehouse and inventory management depending
upon the needs of an enterprise where the client pays
only for the services that are of critical importance.
3.4. Potential in the Desired Work
According to a study conducted at the end of 2012,
15,000 IT professionals have been approximated to use
cloud based services and cloud computing which is esti-
mated to increase rapidly in 2013. 61% of those queried
were reported to use some form of cloud computing,
whereas 39% of the respondents were not using any form
of cloud services. The statistics are presented in a Pie-
Chart, i.e. Graph 2.
Furthermore it is estimated that the companies spend-
ing in cloud computing will rise to $241 billion by 2020
from currently $40.7 billion. Recognizing the benefits of
Software as a Service and Infrastructure as a Service,
41% of small businesses plan to invest in cloud by the
end of 2014 relieving the company of the need for costly
capital investment and maintenance of software thus sav-
ing the costs by up to 90%. IBM’s Chief Technology
Officer reports the decrease in labor cost by 50% when
cloud services are used. 58% of the companies report that
cloud has offered them an improved control of data. Fig-
ure 2 shows the analysis conducted by Cisco Internet
Business Solutions Group (IBSG) of the Small and Me-
dium Businesses (SMB) total expenditure that is adopt-
able by cloud services (shown on the left hand side). The
Adoption of clo ud servi ces
Adopted
N ot adopted
Graph 2. Pie-chart representing cloud adoption.

S. M. K. JAMAL ET AL. 84
Figure 2. Between 2010 and 2015, US SMB cloud spending will increase from 16% of cloudable spending to 44%, or $16 bil-
deploy
 Since, RFID produces large volumes of data that is
ata can be stored and
oviding backup and restoration
e space and available hardware may
ided are always flexible. More
supply chains where condition based informatio n is of
lion, driven by tax and accounting applications and we b hosting.
ght hand side of the figur e depicts the rates when cloud ri
services are adapted to the spending on the left [13]. The
query regarding what proportion of today’s spending in
IT services will ultimately move to a public cloud is un-
answerable since the cloud offers on demand and flexible
expenditure in contrast to the fixed contract in usual
business scenario. Cisco IBSG research also depicts the
high consideration of SMB towards the migration to
cloud based servi ces [ 14] .
Analysis by Cisco IBSG shows that th e total SMB ex-
penditure on cloud adoptable services will rise from $31
billion in 2010 to $36 billion in 2015 whereas the ex-
penditure on actual cloud based services will rise from $4
billion to $16 billion within the same period of time [15].
3.5. Benefits of Cloud Based Architecture
 One of the biggest challenges faced in RFID -
now be preserved and managed on the cloud to depict
more intense business decisions as a result of using
cloud computing.
 Furthermore, cloud computing provides the facility of
elastic capacity which means that the storage capacity
and services prov
ment is its associated cost. The proposed cloud com-
puting solution provides its clients the facility to use
on-demand and pay as you go services. Thus, clients
will be able use RFID technology without having to
make a huge investment on the fully fledged infra-
structure. Small and Medium sized businesses that
cannot afford the cost of deployment and implemen-
tation of new technology can benefit from cloud
computing solution [1 6] .
 The clients need not invest in the hiring of new staff
or training of the current staff for the operation and
maintenance of the new complex system as it will be
provided as a service on cloud.
difficult to store and manage in traditional database
systems, this large volume of d
managed on the cloud on a specific server and is fil-
tered appropriately.
 The copies of RFID data are stored on backup ma-
chines and the backup data can be retrieved by the
central server thus pr
facility that was not otherwise available on trad itional
systems [17].
 The vast amount of data which was lost previously at
initial stages because of bearing low priority or due to
lack of storag
server resources can be allotted as and when the de-
mand increases. When the demand decreases, there is
no need to pay for the unused resources or storage
space. This way the companies that are newly adopt-
ing the techno logy can initiall y demand less resources,
thereby reducing the risk of return on investment on
the RFID system. Then depending on the ROI, either
more resources are acquired or the allotted resources
are returned if the project fails [18].
 Cloud based RFID architecture is of importance to

S. M. K. JAMAL ET AL. 85
central importance as these systems provide real time,
rapid and meaningful information sharing [19].
ovide on-demand information to
y chains can more efficiently and ac
A Smart Card Website. http://www.smart.gov/
[2] K. Finkenzeller, “RFID Handbook: Fundamentals
Applications irds and Identifi
tion,” 2nd Edons Ltd., Munich,
e Later,” Information Week, 2005.
ntati
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ft Research,”
letins/
.epcglobalinc.org/
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ervices and Solutions,” RFID J our -
idden Market,” Cisco
ud Com-
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4. Conclusion
This paper discusses how cloud-based solutions can be
coupled together with RFID-based sensing and monitor- http://www.fcc.gov/oet/info/documents/bul
ing systems to pr
ganizations. Suppl or- - [9] EPC Global. http://www
[10] NIST Computer Security Guideline Publications.
curately trace products and monitor condition-based in-
formation such as expiration dates, temperature and de-
livery status thereby allowing the stakeholders to opti-
mize their supply chains and use real-time information to
make business decisions. The cloud computing solution
can benefit small and medium sized enterprises (SMEs)
because they can use RFID technology without making a
major financial investment on new hardware and soft-
ware purchase needed for data storage and management.
Since lack of understanding is one of the biggest hurdles
in RFID implementation, the proposed solution relieves
its users from the complex infrastructure requirement.
Cloud computing solution for RFID-based systems bears
the ability to revolutionize the supply chains by cutting
IT costs, overstocking and efficiently manage consumer
goods.
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