RFID Basics

RFID (Radio Frequency Identification) is an emerging technology for tracking goods and assets at a distance using radio waves. The objects can be identified through an Electronic Product Code (EPC- containing an array of product information) captured with an RFID Tag.

All information on RFID tags can be scanned by RFID Reader at high speed, from a distance of several meters and out of direct line of site. RFID technology is primarily used to track objects in Supply Chain at SKU level using high frequency RFID readers. Basic components of RFID system include:-

  • EPC Code ( unique number to identify a specific item)
  • Tags ( these can be either sourced from vendors or printed locally using RFID stationery and printer)
  • Data stored on Tags ( it can comprise of date of Mfg., Lot no., MRP etc.)
  • Readers to identify the tags
  • Software and hardware to support collection, management and use of the data

Market Drivers and Needs

  • Regulatery requirements that require companies to accurately track product handling information
  • Mandates issued by USFDA on implementation of RFID technology on Pharma Industry
  • RFID is termed as a way to cut costs to remain competitive and succesful while simultaneously improving product and efficiency
  • Hyper-markets expects to save labor cost by implementing RFID technology for billing purposes – bills for various SKUs can be generated automatically using the RFID readers.

Application across industry sectors

  • Track individual item anywhere in the supply chain
  • Arrest sales loss due to empty shelf
  • Improvement on shelf availability
  • Counterfeit detection
  • Efficient and Fast product recalls
  • Theft/Pilferage detection
  • Asset and People tracking
  • Baggage handling by airlines

Current Market Overview

International

  • Hyper markets in US and Europe have started insisting that all supplies to their stores must be with RFID Tags ( Walmart, Metro etc.)
  • Walmart has announced its top 100 suppliers must tag their deliveries from Jan’05
  • USFDA has advised Pharma companies to implement RFID to fight counterfighting in a phased manner from 2005-2007
  • Gillette and P&G have already started trials on using RFID application

Indian Scenario

  • Ranbaxy has already tried using RFID Tags on all export SKUs
  • Dr. Reddy’s & Pfizer are currently working towards implementation of RFID Tags in coordination with EAN India
  • As per sources, a regulation to implement RFID technology across sectors expected to be in place by 2007

Cost

  • Tags : Approx. cost of an RFID tag ranges between 20-40 cents. However, cost is arrived based on volume, the amount of data and the packaging requirement.
  • Readers : RFID readers and antennas cost aprrox. US$3000/- depending upon the capacity.
  • Printers : A good quality RFID tag printer costs approx. US$ 2000/-
  • Softwares : Cost depends upon the customer requirements.
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