RFID: This Radio Frequency Will Be A Hit

RFID or Radio Frequency Identification is currently keeping trading companies busy because these mobile data memories hold enormous rationalisation potential for supply chain management.

19/10/05 Radio chips, transponders, tags – Radio Frequency Identification (RFID) is currently keeping trading companies busy because these mobile data memories hold enormous rationalisation potential for supply chain management. The data stored in the chip is secured and available at all times. Unlike visual labelling systems such as printed barcodes, they are resistant to moisture and soiling or mechanical wear – in a nutshell, they are also suited for rough industrial environments. They can be read through almost every material and even metallic substrates no longer pose a problem today. 

In the 90s, transponder technology was originally used for immobilisers in the automotive industry where it experienced its first breakthrough. In the packaging sector, the technology made an entrance in the form of a combination of barcode and transponder – the smart label. Some sectors use both systems in parallel. A special application for transponders is the safe handling and transport of hazardous goods.

Read-and-write RFID tags used in the supply chain allow their users to change or delete information during the process. This saves printing costs and re-labelling work. Data on the duration of warehousing and location can be stored on the substrate, allowing products to be not only identified but also tracked and checked in terms of time and place.

These electronic storage media can be incorporated into returnable containers and pallets and can even be adapted to specific applications. A priceless benefit is that these tags can be read without the need for visual contact and that the data of several transponders can be read at one and the same time. Hence, RFID can have the same positive impact on productivity as the introduction of the barcode some 30 years ago. This is precisely the career that experts forecast for these radio chips.

The micro chip turns RFID labels into mini computers. The trend in unit prices strongly depends on component costs. Conservative estimates put transponders at 30 cents per unit, which is why it currently does not make commercial sense to equip individual primary packages with transponders. Fitted to a returnable hygiene pallet, a transponder only impacts the price marginally; attached to a yoghurt cup it may exceed the value of the product. This is why shopping without queuing at cash-desk “bottlenecks” will remain a beautiful vision for some time yet. 

In contrast to visual data encoding by means of two-dimensional barcoding, for example, radio frequency technology transfers data via electromagnetic fields and non-contact identification. The term “transponder” is composed of transmitter and responder. Transponders basically comprise an electronic oscillation circuit and a chip. The oscillator serves as an aerial and, hence, as the interface between the transponder and its environment. The chips have a storage capacity of several kilobytes and are as small as a fingernail. In the off-state, RFID technology does not emit any radiation at all. Transponders source their power from the inductions in an electromagnetic force field established with the read/write device.

In the USA, passive UHF transponders with a frequency of 915 MHz are used for transport packaging identification. In Europe, the UHF-band with 868 MHz is to be used. Since these two bandwidths are not compatible, current efforts are being undertaken to harmonise them. This also holds true for the radiation outputs of the aerials – in the USA, 4 watts are admissible; in Europe only 0.5 watts are permitted.

With ISO/IEC 18000 global standardisation has been initiated.

Component manufacturers, however, are already working flat out on marketable solutions to cut costs. Conductive printing inks, for example, can replace aerials. These printing inks contain silver or carbon particles and convey electrical signals or electric power. This renders manual attachment of copper wires superfluous. They are suitable for all types of printing processes and therefore offer new business opportunities for traditional print shops. They can be printed onto paper, cardboard and plastic films – which represents another benefit: Flexible packaging can be fitted with smart labels, which previously would have interfered with the packaging design because of their relative size and rigidity.

This development not only renders the cumbersome fitting of copper aerials superfluous but also accelerates the production of RFID labels since these inks are suited for high-speed printing. After printing is finished all that remains is for the chip to be attached.

This milestone in the manufacturing of RFID tags cuts production costs, removing a major obstacle to mass production. The aim of this state-of-the-art manufacturing technology is to match the rate of transponder production with normal packaging outputs.

The high potential of RFID transponders becomes manifested when comparing them to the hitherto customary barcode. The EAN-barcode can store batch number, the number of the shipping unit and the manufacturing date. The drawback is that each item of the same sort receives the same number by the producer. Accordingly, products cannot be identified individually as long as they are visually identical with other products and were produced in the same batch on the same day. The 96 bit long Electronic Product Code (EPC), on the contrary, is a unique identifier because each transponder has its own ID number. 

The standardisation bodies Uniform Code Council (UCC) and EAN International have established Auto-ID Inc. to promote the commercial use of this system and to issue EPC numbers. The European headquarters of Auto-ID Inc. is located in Cambridge in the UK.

Transponder technology still offers plenty of scope for new developments. Built-in sensors, for example, can capture the temperature and document an uninterrupted cold chain. By coupling data, internally individual products can be identified on determined pallets, while external coupling allows RFID to be linked to other technologies such as GPS.

A top priority in RFID is the optimal integration of transponder technology into organisational processes with the help of suitable interfaces and software tools. Ultimately, inefficient business processes cannot be streamlined simply by introducing this new technology.

The Logistics Department of the Dortmund University operates a test and demonstration laboratory for RFID transponders. On the attached open space numerous influences on the system and factors can be simulated. The Dortmund experts have also acquired relevant experience in the field of Auto-ID technologies thanks to research and industry projects. This also applies to the area of source protection, i.e. anti-theft protection at the source where the prime applications for RFID refer to the product itself and not only to logistic processes. 

The working party on Source Protection is composed of representatives from twelve companies from a wide variety of industries. Their aim is a nationwide RFID-based anti-theft protection at the source. The working party was initiated by the article securing experts Checkpoint Systems. Source protection means that anti-theft detectors are not only attached to the products at the retailers’ premises but as early as at the manufacturer’s site. This would make it possible to do without chunky and heavy anti-theft protectors on lightweight silk blouses, for example.

The working party “Quellensicherung” defines articles that are particularly suited for RFID-label based protection. These include the highly shoplifted items in each industry, i.e. the items that are stolen most frequently such as razorblades or high-quality apparel. A British chain store joined forces with a razorblade producer in 2003 to test the use of RFIDs on razor-blade packaging at one outlet for several months.

Any standardised technology will naturally make it necessary to deactivate transponders at the check-out to make sure the buyer does not trigger an alarm with his shopping bag in the next store he enters. Data protection officers and consumer protection organisations also claim that this Auto-ID technology must not be used to capture and collect customer profiles.