We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC
    • Podcast
    • Webcasts
    • Blogs
      • One-Off Sound Off
      • Global Logistics and Risk
      • Empowering Your Performance Edge
      • Analytics & Big Data
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • ProMat 2023
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC
    • Podcast
    • Webcasts
    • Blogs
      • One-Off Sound Off
      • Global Logistics and Risk
      • Empowering Your Performance Edge
      • Analytics & Big Data
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • ProMat 2023
    • Upload Your Video
Home » hot topic, lukewarm reception
newsworthy

hot topic, lukewarm reception

February 1, 2004
DC Velocity Staff
No Comments

You don't need to be a regular reader of specialized trade journals these days to know that one of the hottest topics in business is radio-frequency identification (RFID) technology. Thanks to mandates delivered to suppliers recently by Wal-Mart and the Pentagon, even general interest news magazines and daily papers are now covering the race among suppliers to meet the Jan. 1, 2005, deadline.

Yet surprisingly, many of those you might expect to find on the front lines say they have yet to feel the pressure to implement RFID technology. Nearly three-quarters of the distribution managers and executives who responded to an e-mail survey sent to 5,000 readers of DC VELOCITY late last year said they remained unaffected. Nonetheless, most have placed themselves on standby alert. Now that Wal-Mart has pushed ahead, they say, they know their time will come.

For now, at least, few have done much more than sit back and watch the show. A majority of those surveyed have not yet begun implementing RFID. Some are still thinking it over—41 percent report that they're still analyzing what steps to take. Others (19 percent) say they've taken no action whatsoever.

And for most, there's no particular hurry. Wal-Mart's mandate to apply RFID tags at the carton and pallet level by next January affects only the retailer's 100 largest suppliers. So it's not surprising that 72 percent of those surveyed say they're not affected by that company's mandate. Yet they're also well aware that industry tends to take its cues from Wal-Mart (and in this case, the Defense Department). A full 60 percent predict that other customers will require some form of RFID tagging within the next two years. "My account is with Proctor & Gamble and it has not affected us yet, but everything is subject to change in this marriage," wrote one respondent.

Exhibits

Exhibit 1

Where will potential RFID improvements come?
Inventory tracking 84%
Shipment status 64%
Cost reduction 40%
Less paperwork 39%
More data for real-time decisions 61%
Greater flow-through velocity 48%

Exhibit 2

Who would be involved in making the decision to invest in RFID technology?*
Logistics 76%
Sales/marketing 43%
Finance 51%
CEO/President 66%
IT 65%
*Other respondents mentioned manufacturing, purchasing, audit, strategic planning, supply chain engineering, transportation and inventory.

Mixed signals
Once RFID adoption gets under way, how quickly will the conversion happen? The survey responses suggest it will vary widely by industry. For instance, one respondent pointed out that even bar-code compliance is still spotty in some segments of the food-service industry, indicating that RFID adoption could still be years away. But another respondent, who works for an automotive industry business, was more upbeat. He said he expected to see RFID take hold relatively rapidly, adding that the technology "could be very positive for the industry."

Just how positive? A full 84 percent of the respondents believe RFID technology has the potential to improve their logistics operations in at least one area. Most cited inventory tracking as a likely beneficiary (see Exhibit 1).

But not everyone felt the gains would offset the hefty investment required. In fact, while 60 percent thought the investment would be worthwhile, 40 percent contended it would not. Wrote one respondent, "RFID technology … still tends to be cost prohibitive for most inventory tracking applications. As chip prices go down, you will continue to see growth in the application of RFID. However, as in the case of 2D bar codes, many warehouse and shop floor applications simply don't require this added functionality. The low-cost 1D bar code will likely continue to be the technology of choice for many inventory tracking applications."

It appears that the bar code will be around for years to come. Although some predict RFID will replace the bar code as the primary means of capturing data, a full two-thirds of our survey respondents don't think that will happen anytime soon. "It will happen eventually," wrote one, "but it will take something like 10 years to get to that stage."

Given the investment involved, it's no surprise that a lot of people will have a hand in the decision to go live with RFID.When asked who would be involved in the decisionmaking process, 66 percent of the respondents say that their companies' CEO or presidents will play a role (see Exhibit 2). But they clearly won't be going it alone. Nearly all of the respondents reported that the decision would involve more than one department, with 76 percent saying that logistics would have a voice in the decision.

Automatic Data Capture RFID
    • Related Articles

      opening reception not included

      Fortna and Schematic Ventures host reception for logistics startups

    Recent Articles by DC Velocity Staff

    Nearshoring trend sparks demand for logistics real estate in Mexico

    Airfreight rates in May skidded to their lowest level since March 2020

    FMCSA’s Truck Leasing Task Force to hold first meeting in July

    You must login or register in order to post a comment.

    Report Abusive Comment

    Most Popular Articles

    • Union Pacific agrees to provide more predictable schedules for union rail workers

    • Schneider National opens innovation center at Wisconsin headquarters

    • DHL Supply Chain will expand Locus Robotics fleet to 5,000 AMRs

    • Parcel carriers, shippers steer into choppy waters as a perfect storm of challenges approaches

    • Trucking companies face “modestly unfavorable” outlook heading into 2024

    Now Playing on DCV-TV

    B0d646ac 1d71 44f7 9c47 80a0858638b7

    Improve Overhead Access with Custom VRCs

    DCV-TV 4: Viewer Contributed
    Tackling high-reach storage challenges is easy with Autoquip Lifts. We offer a wide variety of design features for Vertical Reciprocating Conveyors, or VRCs, to safely transfer materials from multiple levels based on the client’s specific needs. Don’t know where to start? We can create the perfect hydraulic or...

    FEATURED WHITE PAPERS

    • How to Use Economic Uncertainty to Gain Competitive Ground with Automation

    • Exploring Customized Forklift Solutions

    • Exploring the Future of Labor Management With Capacity Planning

    • Three layers of forklift safety: Promoting operating best practices

    View More

    Subscribe to DC Velocity Magazine

    GET YOUR FREE SUBSCRIPTION
    • SUBSCRIBE
    • NEWSLETTERS
    • ADVERTISING
    • CUSTOMER CARE
    • CONTACT
    • ABOUT
    • STAFF
    • PRIVACY POLICY

    Copyright ©2023. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing