Rick Fox, president and CEO of Fox IV Technologies, recently pointed out some of the challenges facing RFID technologies even if they work perfectly. FOX IV Technologies Inc. has been designing, manufacturing, integrating, supplying & servicing automated labeling systems for a wide range of manufacturing environments and applications for over 20 years. His comments should be sobering to those who see RFID as ubiquitous and universally embraced.
"I estimate the adoption level of barcodes within the US distribution segment of the supply chain at about 20 per cent. This percentage applies to a combined grouping of those cartons that manufacturers and warehouse have properly marked, and distribution centres that are properly equipped to scan barcodes as they are received..."This dismal US performance is despite several factors: the existence of global barcode standards, the cost of printing a barcode being significantly less than an RFID tag, existence of industry-developed formats and stiff penalties for non-compliance. My question is: What are we going to do differently, or what do we think is going to happen, with respect to the implementation of RFID that didn't happen with barcodes?."
"As an auto-ID industry, we don't have a good understanding of why barcodes weren't adopted by the supply chain, as was promised 25 years ago. We need to take the time to understand what happened so as not to make the same mistakes...
"The cost to implement radio frequency identification technology is significantly higher than barcode technology. Barcodes are applied, at the carton level, just before transporting to a warehouse or distribution point. Manufacturers receive no benefit from the technology and yet they bear most of the implementation and ongoing application costs, which are substantial...
"Considering the fact that RFID will face the same supply chain issues, why do we feel the adoption of RFID technology will be any different?...
"RFID technology shows incredible promise to remove costs from the supply chain. However, the implementation hurdles are significant, and, unfortunately, those burdened with implementation costs will not receive much of the value. Manufacturers need to find ways to benefit from the RFID technology other than through forced compliance. This is where the biggest obstacle to a successful adoption cycle lies. This is our biggest challenge as an auto-ID industry, and our biggest opportunity."
The full article about Rick Fox's remarks made at the Auspack exhibition in Melbourne Australia last month can be found here: Matthews Intelligent Identification - RFID technology promise unfulfilled: expert
