While IoT implementation in the supply chain could be revolutionary and result in high levels of efficiency for companies, the lack of empirical research to back up this assumption is alarming. Thus, the purpose of the present work is to analyze how IoT-based real-time tracking influences such operational performance indicators as on-time delivery, inventory accuracy, dwell time, route optimization, and exception response time. Based on the difference-in-differences methodology and longitudinal data from 240 distribution centers for 18 months (120 treatment and 120 control groups), IoT deployment has been proven to reduce dwell time by 34.2%, increase inventory accuracy from 87.3% to 98.6%, and shorten exception response time from 142 minutes to 28 minutes. A new real-time tracking algorithm (RTA) based on Kalman filtering and edge computing technology is also suggested and compared to RFID and barcode approaches in terms of accuracy and speed.