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RFID TechnologyWhy You Can Afford to Wait For RFID to Mature
RFID is a data collection method that utilizes low power radio waves to send and receive data between tags and a reader. RFID eliminates the need for a direct line of sight between the tag and the reader. This makes it possible to simultaneously read and communicate with hundreds of tags. RFID tags can be read-only or read/write specific and already many varieties of tags exist. RFID tags can be active or passive; active tags require an internal power source and passive tags rely on the reader to supply power. Active tags are considerably more expensive than passive tags, with costs that can rise to more than $100. RFID tag cost is an important issue when considering adoption. The average cost for an RFID tag is currently 50 cents, but costs are declining annually and are expected to be as low as 5 cents in the years to come. Presently, costs still remain high and businesses with low-dollar value items need to realize that RFID technology may not be mature enough yet to improve their operations. Even futurists who believe that RFID tags will eventually cost pennies and be used for everything agree that this vision is years away. Jay Steinmetz, CEO of Barcoding Inc., stated “next-generation RFID tags will use electrically conductive ink instead of the metal part of the tag, eliminating the need for some of the hardware and reducing costs”. In addition to the high costs per tag, implementation of RFID has substantial up front costs. Without a good business plan and implementation process, the massive investment required could end up being pointless. Cost has greatly affected the number of companies that adopt RFID technology, but in addition to cost, the limitations that still exist have many wondering if RFID is for everyone. The limitations of RFID aren’t all technological, in the end it boils down to synchronizing business relationships. In order to reap all of the benefits that RFID has to offer, all partners in a supply chain must be equipped with a common data format.Like most up and coming technologies, RFID is still working through some kinks. RFID readers currently have difficulty reading tags through metal or liquid, however future efforts are expected to correct the design. Reading single items on a pallet produces a quite respectable 99% accuracy rating, but reading all individual cases on a full pallet has produced unimpressive results with an average 66% accuracy. RFID has a wealth of potential, but the technology also has several important limitations that need to be corrected before mass acceptance. The limitations of RFID aren’t all technological, in the end it boils down to synchronizing business relationships. In order to reap all of the benefits that RFID has to offer, all partners in a supply chain must be equipped with a common data format. Investment without support from trading partners can delay the passing of vital information and reduce the benefits provided by RFID. When RFID technology matures, tag costs will decrease, standardization will be in full effect, and technological innovation will have repaired many of the existing limitations. Presently adoption of RFID technology is limited to very few companies, but adoption of RFID is predicted to increase in the future. In light of the current limitations and costs, this seems to be the correct decision for most companies.
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