Why Don’t Large Package-Shipping Firms Use Disposable Tags?

Fedex, UPS and DHL have all kept their eyes on RFID for several years, and have been involved with some projects in that area. FedEx partnered with Boeing to test the impact active RFID tags on parts would have on aircraft in the air, because it maintains a fleet of Boeing planes (see Boeing, FedEx Test Active UHF Tags).

UPS Supply Chain Solutions tagged pallets for Staples in Canada, in order to determine the technology's benefits (see Staples Business Depot Sees Big Benefits From RFID Test).

DHL has probably been the most active of the three companies. Last year, it worked with German retailer Metro to track all pallets of goods shipped to Metro's stores in France (see Metro Group, DHL to Roll Out RFID in France). DHL also won the 2007 RFID Journal Award for best use of RFID in a product or service, for its utilization of RFID sensors to track temperature-sensitive drugs (see A Prescription for Spoiled Drugs).

The three firms have not deployed passive RFID tags on their packages, because they have developed sophisticated bar-code systems that can already read bar codes on packages on a conveyor very accurately—something most companies do not do in their supply chains—so they have a fairly accurate view of where packages are located at all times. As the price of passive RFID technology comes down, and as the performance improves, it is possible that they will replace these systems with RFID.

DHL continues to look at RFID technology. The company recently reported that its SmartTruck initiative, which integrates RFID into its delivery trucks to enable faster package handling, has accomplished many of its goals. But the firm said the project is not yet ready to proceed to the deployment phase, because the technology has not achieved a 100 percent read rate of tags by the truck-mounted RFID interrogators. (see DHL Says Its SmartTrucks Save Money, Time and CO2).