RFID (radio frequency identification) has been taking great attention of industry for its various advantages. This technology enables to monitor and track items in production facilities, warehouse operations and distribution. However, RFID system performance is dramatically affected from the operational settings of the system. In particular, identification of appropriate levels for each operational factor is not trivial. In this paper we address an effective methodology to reveal appropriate operational settings for any RFID system. The purpose of this study is two fold (1) to present an organized, concise methodology for identification of influential factors of any RFID system (2) to evaluate operational parameters on RFID controlled conveyor system.