The value of radio frequency identification (RFID) technology is critical for the supply chain, especially in the wool yarn industry, due to the high levels of complicated distribution processes and logistics operations in warehouse. This paper considers a case study for the use of RFID technology in the wool yarn industry. It is aimed at the handling process, such as: trackingwork-in-progress, tracking inventories, counting stock, receiving, picking, and shipping of semifinished products. To do this, an architectural framework of the RFID-based information system for the wool yarn industry was designed, and a cost-benefit analysis was performed to further evaluate whether the new system is economical or not. Also risk analysis was performed for RFID investment.