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Chinese RFID Adoption Takes Many Forms

The Shanghai branch of U.S. RFID technology provider Impinj is seeing strong demand for passive UHF tags and readers from the nation's banking, transportation and retail sectors, with the greatest growth coming from consumer goods manufacturers.
By Claire Swedberg

For instance, Savage says, a large liquor company in China is tagging its high-value products with EPC UHF RAIN tags. When a store receives bottles of the product, it can use its own RFID interrogator to capture the ID number encoded to a bottle's RFID tag, and then utilize a computer to access the liquor company's server and confirm that the tag ID belongs to a genuine product, and not a counterfeit. According to Savage, manufacturers of apparel, furniture and food products are using RFID in a similar way to ensure the authenticity of their goods purchased at stores.

"Chinese consumers are more sensitive to the risk of counterfeit" food products and the health risks they could provide, Savage notes. One company, a maker of Chinese hot sauce, is applying RFID tags to its products to enable customers to use a store's RFID reader to authenticate the goods they buy. The use of EPC UHF RAIN tags on merchandise in stores is increasing in China, she adds, because the cost of readers has dropped and because there is an anticipation that future smartphones will come with built-in RFID gateway or reader technology.

With tags already identifying each product and its stock-keeping unit (SKU), Savage says, a product manufacturer need only install fixed readers within its own warehouse loading docks, or use handhelds to capture tag IDs as goods are transported from the warehouse, received at the port or loaded onto a vessel. This gives China's product manufacturers supply chain visibility, she explains, so that they can count stock, as well as know which items—and how many—are being shipped before they leave the port in China.

While the EPC Gen 2 UHF passive tags are typically being read primarily in warehouses to aid with logistics, Savage says, some companies are approaching Impinj China and its partners (Impinj declines to name its Chinese partners) for solutions to provide WIP visibility. That's because the rising cost of labor in that nation is forcing factories to find other ways to reduce costs, such as boosting efficiency. By tagging products that are moving through assembly, for instance, companies are learning where their manufacturing efficiencies exist, and can thus adjust their operations accordingly to ensure that products move quickly from one workstation to another.

The technology can also be used to better manage material delivery to the assembly floor, by predicting when it will be needed and identifying how many of which products will soon be manufactured and ready to ship to customers. For instance, if a specific number of goods move through assembly, the system can automatically order additional material or parts.

Some manufacturers of consumer products also intend to use the RFID-based WIP data to update customers—U.S.-based retailers, for instance—regarding the status of goods they have ordered. "I consider this almost a next revolution in manufacturing," Savage says, since it enables the collection and sharing of manufacturing data for both the factory and its customers.

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