For more than 10 years, RFID vendors, logistics providers, research organizations, and food and pharmaceutical firms have been developing and piloting the use of RFID to monitor perishable goods in the cold chain. The stakes were high and the challenges formidable. The goal was to track the temperature of perishables in real time during transit, to control exposure to excessive heat or cold and enable companies to be proactive should an incident occur.
Temperature fluctuations of just a few degrees can lead to spoiled goods and thousands of dollars in damages. But early RFID sensor tags suffered from temperature and time-keeping inaccuracies, and when those issues were addressed, tag costs remained high. And, like companies in other industries, food and pharmaceutical firms were reluctant to embrace an emerging technology.
According to a 2013 Frost & Sullivan study of RFID in the global cold-chain market, from 2014 through 2020 the technology will grow an estimated 25 percent in food supply-chain management. This area constitutes almost 80 percent of the total RFID cold-chain market, says Nandini Bhattacharya, a Frost & Sullivan senior research analyst. Growth has been triggered by key regulations such as the U.S. Food and Drug Administration's Food Safety Modernization Act (FSMA) for traceability and similar European Union mandates designed to facilitate recalls, as well as the FDA's Hazard Analysis & Critical Control Points (HACCP) requirements that food handlers develop strategies to internally manage food-safety processes, she says.
While the pharmaceutical and biomedical cold chain comprises just 20 percent of the total RFID cold-chain market, Bhattacharya expects it will see a high growth rate of 45 percent to 50 percent by 2020.
Joining the Food Cold Chain
Meeting government regulations is not the only reason RFID is heating up in the food cold chain. Monitoring perishable foods is smart business. Logistics providers want to improve service for their clients, and retailers want to reduce waste and retain customers.
That's why, in 2013, Hy-Vee, a chain of 236 supermarkets in the Midwest, and its wholly owned subsidiary Perishable Distributors of Iowa (PDI), began RFID-tracking shipments of fresh meat, seafood and dairy from its suppliers to its distribution centers. And that's why Hy-Vee also began tracking the temperature of perishables from PDI DCs to Hy-Vee retail stores.
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