Coping With Regulations
Countries are introducing track-and-trace regulations to prevent terrorist attacks and protect the food supply. RFID can help
companies comply.
April 1, 2004—The age of deregulation is over, at least when it comes to the international movement of cargo and the tracking of food products. Since the terrorist attacks on New York and Washington on Sept. 11, 2001, the United States has introduced a number of regulations that require companies to provide accurate and detailed information on
shipments. Outbreaks of mad cow and hoof-and-mouth diseases and concerns about genetically modified foods have prompted the European Union to introduce track-and-trace requirements.
The regulations require companies to gather accurate, timely data, which means companies might need to invest heavily in people to manually scan bar codes or record information on products. None of the regulations introduced requires RFID tagging (a proposed U.S. animal-identification program recommends it). But as tag costs drop, RFID will become a cost-effective way to gather accurate data. That’s why companies would be smart to include regulatory compliance in their RFID plans and in their business-case analysis of the technology.
“To address the problem of food traceability, retailers and consumer packaged goods firms should use RFID tags to meet traceability compliance deadlines, integrate agricultural firms into the food chain, slash product-recall costs and probe RFID tags’ benefits with a clear business case,” Charles Homs, a senior analyst at Forrester Research, wrote in a recent report. “Using RFID tags to find goods in distribution centers, retail stores and trucks in transit will help firms respond within the predefined time limits to any official inquiry.”
Since 9/11, the United States has been working to secure the 17,000 shipping containers that enter the country each year. Less than 2 percent are opened and inspected, which raises the possibility that terrorists could hide weapons of mass destruction in a container and sneak them into the country. The U.S. Customs Container Security Initiative (CSI) was launched in 2002 to use information technology to identify and target high-risk shipments for inspection.
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The regulations require companies to gather accurate, timely data, which means companies might need to invest heavily in people to manually scan bar codes or record information on products. None of the regulations introduced requires RFID tagging (a proposed U.S. animal-identification program recommends it). But as tag costs drop, RFID will become a cost-effective way to gather accurate data. That’s why companies would be smart to include regulatory compliance in their RFID plans and in their business-case analysis of the technology.
“To address the problem of food traceability, retailers and consumer packaged goods firms should use RFID tags to meet traceability compliance deadlines, integrate agricultural firms into the food chain, slash product-recall costs and probe RFID tags’ benefits with a clear business case,” Charles Homs, a senior analyst at Forrester Research, wrote in a recent report. “Using RFID tags to find goods in distribution centers, retail stores and trucks in transit will help firms respond within the predefined time limits to any official inquiry.”
Since 9/11, the United States has been working to secure the 17,000 shipping containers that enter the country each year. Less than 2 percent are opened and inspected, which raises the possibility that terrorists could hide weapons of mass destruction in a container and sneak them into the country. The U.S. Customs Container Security Initiative (CSI) was launched in 2002 to use information technology to identify and target high-risk shipments for inspection.
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