May 08, 2003May 9, 2003 - Checkpoint Systems and PSC, a point-of-sale scanner company based in Eugene, Oregon, recently demonstrated a bar code scanner that can also read RFID tags carrying an Electronic Product Code.
Checkpoint also teamed with Mirasys Communications, a Finnish manufacturer and distributor of digital video management systems, to create a smart shelf that can deliver video, shrink and shelf inventory visibility to the store manager's wireless PDA in real time.
The products were shown at the Food Marketing Institute show in Chicago this week. Thorofare, New Jersey-based Checkpoint is the world's second largest supplier of electronic article surveillance (EAS) tags. It is also a member of the Auto-ID Center, and it sells its own RFID systems for tracking books in libraries and other systems.
Many of the retailers and manufacturers sponsoring the Auto-ID Center are looking to replace EAS tags, with RFID tags or smart labels that can alert stores to suspicious activity at the shelf. So the big EAS companies are looking to develop RFID strategies. Tyco International, which owns the world's largest EAS brand (Sensormatic), recently announced plans to form a dedicated RFID sales unit (see Tyco Places Big Bet On RFID).
John Thorn, senior director of new business development for Checkpoint, says any EPC technology that Checkpoint decides to deploy will be based on open standards. The reader/bar code scanner that it demonstrated with PSC used both UHF and HF frequencies. The device incorporated two sets of electronics -- Checkpoint's own 13.56 MHz reader and a 915 MHz reader from Alien Technology.
At this point, the reader and smart shelf were for demonstration purposes only. Checkpoint and its partners do not plan to begin mass-producing the devices any time soon. That's because they believe the technology is still too expensive to justify the cost of deployment in most cases.
The tags can cost anywhere from 30 to 50 cents each, and using them for one specific application doesn’t seem to show enough return on investment to justify deployment, says Thorn. For example, preliminary tests show retailers that place EPC tags on individual items to prevent theft in the stores couldn’t justify the cost of deployment.
Checkpoint is in the process of piloting Electronic Product Code technology with several retailers. So far, Thorn says, the only companies that have a good business case for deploying EPC are those retailers that control their own supply chain and can use the technology throughout the distribution channel.
"We’re looking at how EPC can touch as many places in the supply chain as possible," he says. "If operations, the stores, and the warehouse all save money then it may make a better value proposition."
Thorn also speculates that retailers may only track specific items worth over a certain amount of money in order to justify the cost of tagging it. He expects EAS, bar code and RFID technology all to coexist for several years until the price of RFID systems fall. As more and more items have EPC labels, he says retailers will no longer have to buy EAS labels.
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