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Reusable Pallet and Container Coalition Studies RFID

The trade association will begin research to establish the business case for using multiple-use tags on reusable shipping containers.
By Beth Bacheldor
Jun 16, 2006After closely watching the RFID market for some time, the Reusable Pallet and Container Coalition (RPCC) has decided to take matters into its own hands and begin testing RFID technology for the reusable containers its members make or manage.

Next month, the industry organization will begin lab tests at a university to examine the durability of EPC Gen 2 RFID tags when used in conjunction with reusable containers made of wood, steel, plastic or other materials. Unlike commonly used cardboard packaging that is disposed of once goods reach a retailer, reusable containers travel through the supply chain many times, says Jeanie Johnson, executive director of the RPCC, a Washington, D.C., trade association of companies that manufacture reusable pallets and containers and manage pooling services for users and distributors of these products. Association members include companies such as CHEP and Georgia-Pacific.

Some reusable containers, such as pallets, are already being tagged with single-use passive UHF RFID tags as part of Wal-Mart's and other RFID initiatives (see Ballantine Produce Co. Deploys RFID). But Johnson says the use of permanent RFID on containers, such as reusable plastic containers used to transport and display produce, have yet to be explored. These containers must withstand much harsher conditions—they typically start at the grower, move to a distribution center, then to a retailer, then back to the distribution center, on to a sortation facility, then a facility where the container is washed and sanitized, and then finally move back to the grower. "Any RFID tags will have to be reusable and withstand vibrations, getting wet, cooling, and they'll have to go through that loop again and again, dozens and dozens of times," says Johnson. "We're shooting for a multi-use tag that will last as long as the container itself."

Johnson says the two—multiple-use RFID tags and reusable containers—are complementary tools for cost-effective supply chains. Reusable packaging can be more economical and much better for the environment than disposable boxes, she says. Likewise, "if you can establish a business case for multiple-use tags on reusable transport packaging, you'll get your return on investment. It's common sense," Johnson says. "Currently, I think RFID investments are challenged because they try to deliver ROI on single-use tags that are thrown away after being used just one time, and that's difficult."

Additionally, multi-use tags are less wasteful than single-use tags. "What do companies do with all these tags when they throw them away? A lot of companies, including Wal-Mart, do not want that solid waste," Johnson says. Wal-Mart is one of nine companies on the RPCC's user advisory council.

RPCC is hiring a third-party RFID solutions provider to run the lab tests at the university. Johnson declined to name either, but says the RPCC expects to announce both in the next few weeks.

Once the lab tests are done, which Johnson says will take about one month, the organization will write a report and develop an economic model for integrating RFID tags with reusable transport packaging. The goal of the model and report will be quantify the return on investment of using RFID technology for reusable containers versus using it for expendable containers. RPCC plans to make the report available to its members as well as to others.

After that, the RPCC hopes to embark on a field test this fall using RFID to track 1,000 reusable containers of perishable goods. The test will include a major grower, a shipper, a retailer and a third-party logistics provider.

"A year ago RFID seemed like such a huge thing to get our arms around," Johnson says. "I think it's a very bold thing for our board to sit down at the table now and decide to do this project. RFID will be one of most significant issues we tackle." We need to establish a benchmark of where we are now with reusable tags. Johnson acknowledges the lab and field tests may reveal that more work needs to be done on RFID tags so they can be used on reusable containers, but she says she believes any challenges that come up will be overcome and that multi-use tags for reusable containers will soon be marketable. "There is no doubt this all will come to fruition."
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