The purpose of this research is to apply RFID technology to inventory management for handtools company, and proceed to process analysis and evaluate the performance evaluation. In this research, the processing time of standard of procedure of warehouse and production department is evaluated and compare to the new one generated by introducing RFID technology to the procedures. The research results showed that there was a 40-percent manpower off after the RFID technology was introduced in the case company; and that the RFID system effectively reduced the error rate from human's negligence, accurated the quantity of inventory and moved up the whole working perofrmance.