Remunerative RFID

Whilst not a new technology, Radio Frequency Identification (RFID) is generating increasing interest in Europe due to its many advantages over the currently used trace-and-track technologies. RFID refers to technology that allows an object or person to be identified at a distance, using radio waves to energise and communicate with some form of tag or card.

RFID projects are proliferating in a variety of markets such as retail, transportation, pharmaceuticals and livestock, propelling companies and suppliers to adopt the technology in a bid to cut down costs in the supply chain while enhancing productivity.

Global growth consulting company Frost & Sullivan estimates that spending on RFID-related hardware, software and services in Europe will exceed €5 billion in 2007. While the retail and government vertical markets are likely to lead this spending, transport and logistics as well as manufacturing are also likely to contribute significant shares.

Currently, the high prices of transponders or tags are a major obstacle to the mass adoption of RFID. Manufacturers need to price these components more realistically for RFID to enter the mainstream and realise its true potential in the supply chain. Although this could take time, tag costs are already dropping. Further price decreases are likely to positively impact manufacturers' unit shipments and encourage them to attempt more large-scale projects.