Skip to comments.Retailers Plow Ahead With RFID Chips
Posted on 05/21/2006 9:35:29 AM PDT by Nachum
The roots of radio-frequency identification technology stretch at least as far back as World War II, when transponders helped distinguish between Axis and Allied aircraft. Over the years the concept has been greatly miniaturized, landing RFID technology in such settings as animal tags, toll-collection devices, passports, keyless entry systems for cars and wireless credit cards.
But perhaps none of these projects will have as much impact for consumers as the adoption of RFID in the supply chains of huge retail stores.
Mega-retailers led by Wal-Mart Stores Inc. (WMT) have gotten their biggest suppliers to add RFID chips to pallets and cases shipped to stores. Now, rather than having people with bar-code scanners walk around to take inventory, RFID readers in warehouses can automatically tally items on the fly.
RFID is expected to yield substantial savings largely by reducing the frequency of the following scenario: A customer goes to a store for an item, only to find its shelf empty, even though replacement stock lurks somewhere in the back. It's one of the costliest problems in retail.
Simon Langford, Wal-Mart's director of logistics, distribution and replenishment systems, explains that a bar-code scanner can register that certain items have entered a store's back room. But not until one of the items gets scanned at checkout does the store typically get an update. In between, the item might be on a store shelf or still sitting among back-room clutter.
In the more than 500 stores where Wal-Mart has integrated RFID, radio tags give additional insight - they inform employees when supplies enter the storeroom, when they leave it for the sales floor and when their emptied cartons are taken to the trash.
A University of Arkansas study last year determined that these stores saw a 16 percent reduction in the times that products were missing from shelves. But Langford said that figure understated RFID's true power, because the study included popular items that sales staffers already were sure to replenish. When the research examined only items that Wal-Mart sold less than 15 times a day, the out-of-stock reduction was 30 percent.
Wal-Mart hopes to see even greater improvement soon by giving employees handheld RFID scanners that will direct them precisely to cartons of products they need to bring from the storeroom.
Eventually, individual products in Wal-Mart and other stores are expected to get their own RFID tags to give stores even clearer views of their inventory.
"That's really where the supply chain gets most messy," said Kevin Ashton, who helped drive RFID development at the Massachusetts Institute of Technology and now heads marketing for ThingMagic LLC, a maker of RFID readers.
Some high-value items like TVs and pharmaceuticals already have their own tags. But most item-level tagging is a decade away.
First, tag prices must drop below their current 5-to-7 cent range. Work also still needs to be done to master wireless interference issues that can arise in RFID-dense environments. And developers have to assure the public and retailers that data on the tags are secure and not invasive.
"We're seeing the RFID industry get a little bit more mature every day," Ashton said. "We don't view the RFID market as some overnight sensation."
If the legislators are not going to ban them, then at least, they should require manufacturers and retailers to inform the customers where the chip is placed with instructions on how to remove or disable it after they leave the store.
Any hope for an rfid arrow shaft so that shot deer don't go unfound?
I used to be a big technocrat.
I've lately been wondering how foolish it was for anyone to have left the farm life, for any reason at all.
if you don't have a reader it is effectively disabled.
Thats easy...Try having diabetes without technology.
Thats easy...Try having diabetes without technology.
You really can't have diabetes for long without technology. Without technology what you mostly have is funerals of diabetics.
I see the sadness, but also the price. It grows every year.
In the past couple of years, since Walmart's RFID plans became public, I have been looking for stock opportunities in this field. I haven't found any publicly traded companies that are pure plays. This article mentions ThingMagic LLC, and I went to their website and they talk about "generous stock options" for prospective employees. But I can't find that company listed on any exchange or OTC.
Maximizing profits, reducing overhead. Does that necessarily mean lower retail prices? Or higher earnings? Both? Pro'lly 5/3/2/1 -- Exec bennies/inventory expansion/ROI/retail buyers. Naw, scratch retail buyers . In fact, cut ROI in half and raise bennies to 8 and buy more RF chips with the remainder.
They seem to be owned by Tyco Electronics. http://www.rfidsolutionsonline.com/content/news/article.asp?docid=afbb9716-4640-4961-ae4f-b50f0d41243b&VNETCOOKIE=NO
LOL. Reminds me of the story about the rich Wall Street banker (WSB) and the poor Mexican fisherman (PMF). The WSB is on vacation and notices the PMF brings in quite a haul whenever he chooses to go fishing. He begins telling him that if he fished every day, bought a few more boats and hired some help, he could greatly increase his volume. Then, if he moved to the States and began a fish processing plant, he could eventually take it public, get rich & retire.
The PMF asked what would he do then. The WSB replied that he could then move back to his village, kick back and go fishing whenever he felt ...
Exactly my point.
My point, such as it is, is the fact that nothing stops technology. This is particularly true for a capitalist system where technology often provides an edge in a competitive marketplace.
Stem cell research, to cite one example, had its gubmint funding cut. So what happens? You get three states (CA, MA and NY) dumping a ton of money into the kitty to establish themselves as the biotech capitals of the country.
Yeah, there are casualties and unexpected consequencesin the march into the future, but the march will continue. And it'll continue either here in the U.S. or elsewhere.
Thanks for the info, but in the article you linked it is not ThingMagic but M/A-COM, Inc. that is mentioned as a business unit of Tyco Electronics.
If you understood how these really work, you would not be concerned.
Thank you, good and robotic citizen of the State.
But hey..Ive been thinking of marketing an RFID "disabler" to the tinfoil crowd
Zebra Technologies. They make the printers that print RFID tags. Check out it out at Zebra.com.
IMHO, it would be a good buy now that RFID is moving away from the early adopters into wide spread use.
The stock took a few hits recently as they did not have the kind of growth rate some investors were looking for.
To me it is more of an issue of how long it takes to roll out RFID integration projects.
I have owned the stock for years. It is a great company.
Dude, start here for example.
Zebra, got its start in BARCODES which were even more sinister than RFID - they were feared by some as the mark of the Beast. A zebra has stripes, and so do barcodes, thus the old company (which name I forget) re-branded to Zebra Tech.
I think you'll find Zebra is big in BARCODE printers, not RFID wafer or chip technologies.
I've merely expressed my dislike for them and an opinion. Don't call me dude, and YOU go away.
Dont make me seperate you two! ;-)
Why? They don't transmit. Do you cross of the UPC bars on your cereal packages? Because RFID is just as dangerous as a printed UPC code.
The next step is in restocking the consumer directly. Imagine an intelligent pantry, that issues restocking orders when things get low.
I think many are under the impession that RFID transmits, and indeed those systems exist for semi trucks to be tracked.
But RFID at retail level is a passive system as you say no more intrusive than barcode but a LOT easier to inventory!
Active RFID would be cost prohibitive on retail items.
Also the entire idea that gubmint is tracking our everymove is silly. Its like the phone records thing.
The gubmint simply doest have the power of the will to track all the mundane details of our daily lives
My life ALONE would set a big part of the Gummit complete asleep from boredom ;)
THE MARK OF THE BEAST IS ON MY CREAMED CORN!
Complacency..Thats how they getcha! /sarc
Funny no one gives a toss about posting on the net when it comes to privacy. do a google on you screenname to see what I mean
Then we're all in agreement then, that at the time of purchase there should be instructions to the purchaser on how to remove or disable the chip. That's all I'm really asking for. Is that too awful much? Hmmmmmm?
No, since it is benign. An RFID chip DOES nothing.
Like I asked -- do you take a marker and black out UPC codes on your groceries?
I'm almost afraid to say anything, but have you ever looked into the tagants?
"and I would have gotten away with it too...if it weren't for those meddling kids!"
Is it top of the head shaped, and made of foil?
That's my invention, your evil thought stealing chips have stolen it from me while I was in the shower.
Now to invent a tinfoil showercap!!!!
I think the dude does.
I take it your answer means "no." A consumer should not be allowed to remove or disable an RFID chip. That's all I'm asking for, and you two seem to be resistant to a simple request. Why?
Honestly I was thinking of getting in on the hysteria.
Ive noted that all people of all backgrounds and education seem to have a fear of RFID
Why, thank you! So far you seem to be the only one other than I, who thinks it is a reasonable request.
The passive devices do transmit. They are powered up by the beam of the reader. The simple ones transmit by backscatter. With the std reader they can be read from several meters.
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VeriChip Corporation's RFID Technology Prevents Infant Abduction at North Carolina Hospital
DELRAY BEACH, Fla.-- July 18, 2005-- VeriChip Corporation, a subsidiary of Applied Digital , a leading provider of security and identification technology, announced today that its "Hugs" RFID infant protection ...
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