Efficiency and competitiveness are cornerstones of any success in business. One way a company can achieve both at once is by adopting Radio Frequency Identification (RFID) to speed up their logistics process. The technology has been applied widely in Hong Kong for things such as access control, automatic payment systems and animal tagging.
RFID was first used to identify aircraft during World War II, but lack of a common standard prevented extensive use in the global supply chain until recently. However, with the development of the Electronic Product Code (EPC) and its acceptance for international commerce, the true potential of RFID has been recognised. Major enterprises such as Wal-Mart, Auto-Toll, Octopus and the Hong Kong International Airport have been using the technologies, while many more anticipate new applications for logistics tracking and tracing and in-store retail operations.
EPCglobal Inc was formally set up in September 2003 to facilitate the adoption of EPC and RFID in different industries worldwide. The establishment of EPCglobal Hong Kong followed earlier this year under the auspices of the Hong Kong Article Numbering Association (HKANA). This non-profit body for supply chain standards manages and promotes the adoption of EPC and RFID by various businesses through arranging seminars and helping interested enterprises to find suitable partners.
K K Suen, supply chain management consultant for EPCglobal Hong Kong, explains the advantage of the technology is that it can be read through packaging and many other materials without direct physical contact. Dozens of RFID tags can also be read simultaneously. A combination of the mobility offered by wireless technology and the capability of reading multiple tags means RFID can bring significant improvements in productivity and efficiency, while making theft and counterfeiting more difficult than when traditional barcode scanning is used.
Mr Suen notes that Hong Kong, as a leading entrepot, could apply RFID to control the movement of numerous products. "While the technology is still new, unit cost per RFID tag is about HK$4, with variations subject to the environment and scope of applications," he explains. "Owners of high value mobile phones, electrical appliances and luxury brands will find the return on investment of EPC/RFID implementation is more than justified. But costs will be reduced with wider use and new technologies will follow."