Are improved RFID systems more effective for warehouse management?

By Ruari McCallion

November 2011

Where are we with RFID?

Efficient warehouse management depends on reliable and accessible information, which would appear to be a shoe-in for RFID tags. But have they overcome problems of cost and effectiveness?

Ruari McCallion has been finding out.

RFID (radio frequency identification) tags promise a great deal. They can carry more data than conventional barcodes and they can be active, telling warehouse management systems where they are and what has happened to them. However, takeup of RFID systems has been pretty low. In a paper called ‘RFID in the supply chain: lessons from European early adopters”, in the International Journal of Physical Distribution & Logistics Management (White, A., M. Johnson, and H. Wilson, 2008), the authors reported that no less than 67% of companies in distribution, transport, logistics or warehousing activities had no plans for RFID trials and only 13% deployed RFID technology in their business.


Researcher Witold Bahr of RFID Advanced Research group at School of Engineering and Applied Science, Aston University

The figures were quoted by Witold Bahr and Dr. Ming K Lim, of the Engineering Systems and Management School of Engineering and Applied Science, Aston University, Birmingham, UK, in a presentation to the XIX International Conference on Materials Handling, Construction and Logistics. Among the concerns mentioned were cost, ROI (return on investment) and reliability – one particular issue raised was the ability of RFID systems to read tags on moving forklift trucks. A study in 2009 by the California Polytechnic State University found that readability fell to just 12.8% forpalletsofdrinkcanscarriedthroughtheRFID portal at a lift truck speed of 16.09 km/h.

Making it work

However, companies like Sony, Hugo Boss and DHL – perhaps DHL especially – are very unlikely to implement a system that does not work. Sony is expanding its RFID activities from the initial project at its electronic products distribution centre in Tilburg, in the Netherlands, to DHL’s Freight Hub Cologne, a central gateway for the distribution of Sony products in Germany, after a five-month pilot project. The Tilburg operation involves direct integration of SAP, Zebra RFID tags and technology, Reva Systems Tag Acquisition Processor (TAP) products, and Symbol, with integration services provided by Mieloo & Alexander. It combines item-level RFID and digital video to increase efficiency, control ‘shrinkage’ (a euphemism for theft) and streamline claims processes.


Businesses need solid warehouse practices and barcode systems should be the first step

“Sony is expanding its RFID activities from the initial project at its electronic products distribution centre in Tilburg, in the Netherlands, to DHL’s Freight Hub Cologne, a central gateway for the distribution of Sony products in Germany, after a five month pilot project.”

Sony tags products for shipment with RFID labels and records the tag IDs at each stage – picking, stacking and when shrink-wrapped onto pallets. It logs pallet movements all the way through to loading onto delivery trailers. Automated video records the process, burns RFID data onto the video image and stores the video data according to RFID information, for comprehensive proof of delivery. Initial problems with poor reading during product transport by overhead conveyors and lift trucks were resolved by Reva’s TAP system, which uses European Listen Before Talk (LBT)-standard systems.

Hugo Boss cuts to the chase

The Hugo Boss hanging garment distribution centre in Metzingen, Germany, uses a Fordertechnik clothes hanger adapter featuring an RFID system from Baluff. The facility stores around 1.35 million articles and dispatches some 100,000 each day. At the sorting area each garment is given its own L-VIS which contains a Baluff RFID chip and a 2D barcode holding identical information. The RFID code is read automatically by the conveying technology, while the 2D codes are read manually using a hand-held reader. The RFID chip is from Baluff’s BIS series, which allows inductive data exchange within direct alignment of the product with a reader, and without contact. The decoder can be supplied with 30 read heads but it was determined that a two-read head system was more appropriate for the large facility. Transport units can be tracked over the entire conveyor line and within the aisles between the individual shelves.

A 2D code alone would have required camera technology to be installed at all 110 read stations and it was also found that the cameras would not have been capable of reading the codes reliably at the speeds required. Although the facility has high personnel overheads, Hugo Boss has said that it is economic because of the high level of automation and short transport distances within the warehouse.

“The Hugo Boss hanging garment distribution centre in Metzingen, Germany, uses a Fordertechnik clothes hanger adapter featuring an RFID system from Baluff.”

These two examples – and RFID introduced in DHL’s corporate apparel supply chain, which has 39 manufacturing locations globally – have something rather important in common: they were all implemented after careful analysis and pilot studies. Zebra Technologies, a leading vendor of RFID technologies, emphasises the importance of getting one’s ‘house in order’ first and should walk before breaking into a run. Zebra says that businesses need solid warehouse practices, good fl ow in and out, good people and good processes, and barcode systems should be the first step – they deliver ‘out of the box’ and there is a lot of experience to be drawn on already in the marketplace.

Planning problems out

Going forward, quite a few problems originally associated with RFID have been faced and overcome. Its dislike of metal can be handled easily, simply by mounting a rubber seal between the RFID tag and the metal of the product it is sitting on. Sealing it prevents water from interfering. And some suggestions should be obvious, such as: do not use high-cost active RFID tags on non-returnable pallets. Passive RFID tags are cheaper than active ones and can deliver to needs to a reasonably high level. The tags’ ability to acquire and distribute information, and to hold a significant amount, is extremely useful and can help reduce selection times in warehouses from an average of over a minute to just a few seconds. But the key is: prepare first. eureka mentioned the arrival of bokodes, technology that is capable of storing massive amounts of information in a tiny tag.

They may be the future but, for now, they are expensive – and going straight to an advanced setup will not overcome problems that are inherent within a warehouse management system that is not right in the first place.

With thanks to Hugo Boss, Mr. Bahr and Dr Lim for their help in preparing this article.

10 top tips for successful implementation of RFID technology

  1. Ensure there is plenty of time for planning and research. Establish exactly how your company can benefit from RFID before you start spending.
  2. Plan RFID from the ground up. Start with the processes on the warehouse fl oor and work upwards to make a profit throughout the supply chain
  3. Thoroughly research RFID offerings. The choice on the market can at first seem bewildering, but it’s vital to make the right choice for your business
  4. Get the right supplies. Remember to get the print media right for it all to work effectively
  5. Choose the right partners to ensure your RFID system runs smoothly. There are a lot of experts out there – make sure you choose the partner which knows your industry and technology best
  6. Take a step-by-step approach. Caution is the key word – set yourself achievable goals and you’ll see the results at every step
  7. Carry out thorough testing to avoid issues as the implementation scales up. The only way to keep track of the roll out and monitor success is to test at every stage
  8. Analyse the data to drive ROI. Keep track of your ROI – the results will be worth it
  9. Extend RFID internally, to make the most of the technology. Think of where else you can use RFID to get your money’s worth
  10. Plan for flexibility during the implementation. Accept that the plan will change during implementation

Tips provided by Zebra Technologies



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