By Samuel Greengard

Ben Miyares has seen the future of packaging and it's smart. The vice president of industry relations for the Packaging Machinery Manufacturers Institute believes that over the next decade, radio frequency identification transponders will be embedded in corrugated boxes, caps of pharmaceutical products, cartons, and plastic containers and trays, ushering in an era of smart packaging. Manufacturers and retailers will be able to use the transponders in packages to track the movement, monitor the condition and ensure the security of their products. "RFID has the potential to change product packaging and the way companies use it within their supply chain and beyond," says Miyares.

This is a vision that both excites and scares many packaging executives. It excites them because creating higher-value smart packaging could enable them to increase their margins on what has long been a low-margin business. It scares them because it's not clear that packaging consumers will be willing to pay extra for corrugated boxes and other packaging with embedded RFID transponders, which means the additional cost of the RFID tags could come out of their already slender margins. Even if packaging consumers are willing to foot the bill for the RFID transponders, packaging companies will need to invest significant sums to figure out how to embed tags in packaging in a cost-effective way.

The next wave: thinking outside the box by embedding inside the box.

"Not only is there a question about who will be willing to pay for embedded RFID, there is an array of technical issues that must be addressed," says Brian O'Banion, vice president of the Fibre Box Association.