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Omni-ID to Open Production Plant in China

Growing demand for the company's passive EPC Gen 2 RFID tags has led Omni-ID to establish a manufacturing subsidiary in Qingdao, in order to keep up with orders.
By Claire Swedberg
Aug 03, 2009After completing its most profitable quarter since its formation two years ago, Omni-ID, a manufacturer of passive ultrahigh-frequency (UHF) RFID tags encased in hard plastic, has opened a subsidiary manufacturing facility in China to help the company meet its rising volume of orders. Betting that the sagging economy will no longer pose a significant negative impact on the demand for passive RFID tags, and that the expected economic growth will result in greater RFID tag usage, the tag manufacturer—which spun off from British defense and security technology company QinetiQ in 2007—is establishing the subsidiary to take on work currently handled by third-party providers.

The Qingdao facility, known as Omni-ID High Science & Technology Co., Ltd., will open in September 2009 within the Qingdao Export Processing Zone (QDEPZ). The 20,000-square-foot facility will employ a staff of 50 workers and have the capacity to manufacture 6 million passive UHF Gen 2 tags each year.

Tom Pavela, Omni-ID's president and CEO
Omni-ID specializes in producing EPC Gen 2 passive RFID tags that can withstand harsh environments and perform reliably in the presence of metals and liquids, which can hinder tag reads. The company required the new facility due to the growth in its existing customers' demand for passive UHF tags, as well as the acquisition of new clients, says Tom Pavela, Omni-ID's president and CEO. The company's customers include IBM (see IBM Offering IT Asset-Tracking Solution), Hewlett-Packard, Wal-Mart and Sam's Club.

In the past 12 months, Pavela says, average orders for Omni-ID tags have grown from tens of thousands to hundreds of thousands at a time. The tags are typically utilized for asset management, logistics (tracking cartons and pallets, for instance) and tracking work in progress at manufacturing sites and other facilities. "Each order was getting larger," he explains. "We were faced with the decision of either ramping up outsourcing efforts or establishing our own manufacturing facility."

The new center will allow the company to shorten its time to market and improve the overall quality of its RFID tags by providing Omni-ID with tighter control over the products it makes, rather than outsourcing the work. It also will enable the firm to rapidly produce product prototypes when necessary, Pavela notes, because the manufacturing site will be able to quickly develop tags designed in-house by Omni-ID.

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