Four years ago we ran a cover story talking about the golden future of RFID (radio frequency identification) technology as a logistics management tool. At the time, it looked like widespread adoption of low-cost RFID tags was just around the corner. For a variety of reasons, it turned out to be a good deal further away, more like across the country than around the corner.
But here we are four years later and the inevitable business pressures of cost reduction and productivity improvement are finally pushing RFID tags into the mainstream. Being the world's largest retailer gives you a lot of market muscle, so Wal-Mart's insistence that its suppliers start using RFID on all pallet shipments by the end of this year makes that a fairly safe prediction. If you still have any doubts, the U.S. Dept. of Defense, certainly another one of the world's largest users of freight services, has issued a similar edict to its suppliers, all but ensuring that radio tags are finally here as a basic component of freight management.
One of the main reasons it's taken so long to get to this point has been the absence of a universal standard that would allow reliable and consistent communications between tags from a variety of suppliers and all the various reader devices that will needed in plants, warehouses, terminals and stores.
Negotiating any type of universal agreement is always a torturous process, especially when you mix in international parties and big businesses jockeying for commercial advantage in what will certainly be a market worth hundreds of billions of dollars. However, the group responsible for developing such a universal standard has now entered the final phase of issuing its proposal, one that meets DOD and Wal-Mart requirements and has the support of the major RFID technology providers.
As the industry charged with moving that tagged freight at least for some part of the supply chain, trucking is certain to play a key role in RFID implementation. There are already demonstrations of trailer sensors that read RFID tag information and forward it over wireless tracking systems. Tag readers might just as easily be placed at dock doors, on forklifts or anywhere pallets move on their way on to or off of a truck. As the common denominator for virtually all freight moves, trucks just make sense as a place to reliably capture RFID data.
The trick for trucking is to be more than a passive conduit for that data. You're going to bear at least some of the costs of RFID, so you might as well reap some of the rewards, too. Automatically collecting detailed information about shipments loaded and unloaded on your trucks has to have value, especially if it's captured in or near real-time.
I know the promised mutual shipper/carrier benefits never really materialized for that earlier electronic data automation technology, EDI. Instead, fleets that were forced by shippers to implement EDI were left with a bill and no definable payback. But this time, I think it's going to be a different story, if only because trucking is far more sophisticated these days about information and its value. I guess we're finally about to find out.
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