The State of Radio Frequency Identification (RFID): Real-World Applications for RFID

Publish Date: Mar 30, 2016 | 1 Ratings | 5.00 out of 5 | Print | Submit your review

Overview

This tutorial discusses the real-world applications for RFID, and it is the fourth part of a six-part tutorial series. The tutorial series is based on the transcription of a presentation by Mark Roberti, Founder and Editor of RFID Journal, during the RF Summit at NIWeek 2005. The presentation is broken into six RFID topics, including successful real-world applications, industry trends, and areas of improvement.

1. Part 4: Real-World Applications for RFID

In the past everybody looked at RFID as a point solution. “I’ve got a problem in my operations; I’m going to deploy RFID to solve it.” It could be a 13.56 [MHz tag] or whatever.

[One problem RFID can improve is asset utilization.] Companies lose things. Air Canada was losing over $2 million worth of food carts a year. So they decided to put active RFID tags on those things just to track them and to make sure they knew where they were and could eliminate some of that loss.

[RFID can boost manufacturing.] For example, we’ve done studies about golf cart companies that have put tags on carts as they move through their manufacturing process and were able to increase the throughput of their factories.

[RFID improves inventory management.] Typically, if you’ve got big items that you can put a tag on they’re easy to track; billions of boxes are a lot harder.

Most companies have adopted RFID for access control and speed payment. Now you see Visa and MasterCard introduce cards—fast payment cards or cash cards both have an RFID tag. You walk up to McDonald’s and swipe your card, and you pay through that. So those are the point solutions, now what we’re moving toward. What Wal-Mart is moving toward is using this Electronic Product Code technology to create an infrastructure.

Now the way I talked about this is, we’re taking the Internet and adding RFID readers to it and tracking goods as they move through the supply chain. So wherever they appear [at a] distribution center—they come in a door, they go out a door, they move through a choke point, they move from the inventory area of the warehouse, to the damaged goods area—you have readers set up [to] read those. The advantage over a barcode is RFID doesn’t do anything you can’t do with barcodes; the problem with barcodes is you need people to scan [them], and you’re not going to deploy an army of people to scan goods anytime they move somewhere in the supply chain. So if you have these readers set up as infrastructure, you can collect data with no incremental cost beyond the maintenance of the reader once it’s installed, and that’s the important point here. So once this infrastructure becomes ubiquitous, you can collect an enormous amount of data. You can know where everything is in real time. You can know when goods are damaged because they’ve been moved to that damaged goods area because you have a reader set up there. You know this in real time, and that allows you to better manage your inventory and to create new algorithms, so you replenish products in a timely way.

Today 8% of stores, 8% of the goods in stores are not on the shelf. Go into Wal-Mart, look around the shelves. About 8% of the time you will find an empty shelf. If Wal-Mart can increase sales 1% by reducing that 8% number—which they’ve been trying to shrink for a long time and have not been able to do. If they can do it with RFID, that’s $3 billion per year in sales without hiring another person, except perhaps [to] maintain the readers without opening a store, without opening a depot or a distribution center, $3 billion in increased sales if they can improve that by 1%.

For manufacturers the challenge is, “How do I use this to get benefits? Especially now when the cost is high and I’m paying for the tag.” The manufacturers are struggling with this right now, so what they are looking for is if efficiencies will add up to bigger efficiencies. “How do I work with Wal-Mart or Target or Texaco or Metro in Europe to make sure the goods are always there? How do I work with them to automate the process of receiving and having electronic confirmation that the goods have been received? How do I avoid charge backs?” People think that the supply chain is super efficient, and by and large it is, but Gillette and PNG and those guys, they have people that live in Bentonville, Arkansas, and their only job is to deal with Wal-Mart and say, “You said you didn’t get this. We shipped it, and here’s proof that we shipped it, and here’s proof that you received it.” They spend all day haggling over invoices and trying to reduce the charge backs that Wal-Mart charges them when Wal-Mart says it didn’t get something that it paid for. That’s a full-time job for lots of people in Bentonville.

So if you can use RFID to confirm receipt and track these goods and have everybody see through the electronic data they’re sharing [that] the goods arrived, you can eliminate those people, eliminate those wastes. That’s the benefit for the manufacturers but this is similar to the Internet. When you deploy the Internet, you don’t say, “Well I get a return on investment from email,” or, “I got a return on investment from my supplier ordering system.” What you’re looking for is for all of the benefits that come with this infrastructure, and that’s also a difficult thing. How do you justify this investment today when it’s very expensive [and] when you can’t pinpoint a concrete ROI for one or two specific applications.

This concludes fourth part of a six-part tutorial series.

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2. Solution for Testing RFID Readers (Interrogators) and Tags


VI Services Network, a NI Alliance Member, currently offers a complete test system for testing RFID readers and tags.
The test system is based on the following NI products:

 

 

 

 

 

 

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