Smart Labels
To comply with the mandates of large retailers to provide RFID tags on cases and pallets that identify merchandise, a combination bar-code label/RFID tag is typically used. This kind of a tag, called a “smart label“ has a very flat RFID tag embedded within a printable adhesive label. Smart labels are typically used in supply-chain applications because not all entities along the supply chain are RFID-enabled. Smart label printing eliminates the need to perform two separate operations: first, to print and apply a bar-code label and second, to encode and apply an RFID tag.

Specially designed label printers are used that print the bar-code and encode the embedded RFID tag at the same time. Keep in mind that depending on the volumes of tags being printed, the added task of encoding the tag can make the production of labels slower than if labels were being printed with bar-codes alone.

In some cases, the RFID tag in the smart label can be reprogrammed so that the information in the tag doesn't remain static. For instance, the tag may be programmed with one kind of information from the manufacturer and additional information by the distributor. Typically, smart labels are programmed once and then disposed of when the inventory tracking process has completed.

The RFID tag within smart labels is typically encoded with an electronic product code (EPC) and any additional information required by the customer.

The cost for smart labels is currently about 30 to 50 cents each, while the printer that accommodates both the printing and programming of smart labels costs between $2000 and $5000. In addition, it is necessary to ensure backend software can accommodate the RFID data that is passed to the printer/encoder. For some companies, this latter task can be expensive especially if the software needs to be changed to accommodate RFID data.

RFID labels are more fragile than regular labels. Not every label in a roll will work, but manufacturers are rapidly improving the rejection rate. Shipping and handling can cause damage to the RFID device. Some labels may experience damage to the antenna or the chip may be crushed during shipping. Another concern is an electrostatic discharge (ESD). A charge as little as 500V can damage a chip in some circumstances, while a warehouse operation can generate 8kV to 15kV of electrical discharge. It is important to take into consideration the environmental effects on RFID labeling, from static discharge to interference from some lighting systems. A solution may be as simple as a different antenna.
The question of who will be responsible for the costs associated with unreadable labels is still unclear. Users should verify that labels are readable as they ship and document that information.

EPC Codes and Standards
The electronic product code (EPC) is the basis of the effective use of RFID in supply-chain applications. The EPC code is derived from a 14 digit Global Trading Identification Number (GTIN), which is based on existing UCC/EAN data structures, and is currently used on RFID tags at the pallet and case level in place of UPC codes. There are two reasons why EPC codes are necessary when RFID is being used in supply-chain applications: first, to create globally accepted standards for product identification in which products around the world are identified and described in a standardized way, and communications about product attributes between partners are also standardized. Second, EPC provides the potential to uniquely identify every individual item that is produced by a supplier; for instance, each gallon of milk can potentially have its own unique serial ID number that can indicate the manufacture date, the plant where it was bottled, the lot number, the expiration date, etc.

Serial numbering is not yet cost effective except for big ticket items; however, once tags cost a few cents each, serial-numbered RFID tags will likely appear on most individual products. This will provide a host of benefits to retailers. For instance, stores will be able to automatically detect when shelves need to be restocked (which can in turn trigger the automatic generation of purchase orders), and will be able to quickly locate and remove sale products that are defective, out of date, etc.

EPC codes are typically 96 bits in length, and are programmed onto an RFID tag to identify the manufacturer and type of product (as bar codes do today). In many instances, companies are using their present 12-digit UPC code within their new EPC code. Until the cost of RFID tags reach the cents-per-piece level, many companies will use RFID codes to only track items at the Stock Keeping Unit (SKU) level which identifies manufacturer and product type only, and then only in case and pallet units of measure.

The following is an example of a 96- bit EPC code (24 four-bit characters):
In the above example, the portion of the code shown as the “EPC Manager“ identifies the company, while the portion of the code shown as the “Object Class“ identifies the brand, model, size, unit of measure, etc. Optionally, the last portion, the “Serial Number“ can be used to identify the individual product.

Before a company can program EPC codes into RFID tags to meet basic RFID compliance requirements with major retail customers, it must ensure it has EPC codes that meet global standards and that are registered on the Global Data Synchronization Network (GDSN). Essentially, GDSN is a private “Internet“ for global trading partners that allows partners to access standardized information about a product. To register EPC codes on the GDSN, a company must subscribe with a trading partner that is a member of GDSN. Trading partners include UCC.net, Transora, WorldWide Retail Exchange and many others.

Once a company has standardized and registered its EPC codes, these will need to be associated with inventory items in the backend computing systems. Third-party software is required to take the EPC code data and write it to the RFID tag as it passes through a special label printer/encoder. The printed/encoded tags are then applied to cases and pallets. More detailed information about data synchronization can be found in Chapter 6.

EPCglobal® Frequency Specifications for RFID in Supply Chains
An organization called EPCglobal has created different specifications for the frequency, encoding characteristics and other attributes of RFID tags, which have become the standard in supply-chain applications. EPCglobal is an affiliate of the Uniform Code Council (UCC) and EAN International (EAN). Both of these organizations (UCC in the United States and EAN in Europe) maintain the EAN.UCC System, which for years has managed worldwide bar-code numbering assignments and bar-code symbology standards.

Unfortunately, there is not yet a single agreed upon group of standards for RFID tags that are used in supply-chain applications; it is likely, however, that one will emerge before long. For now, different retailers have decided to go with different “classes“ defined by EPCglobal. It is critical that before
creating RFID tags to comply with the requirements of a retailer or government agency, that you make sure of the version and class that is required.

Version 1.0 (Generation 1 “Gen1“)

* Class 0 tags. These tags are read only (programmed only once), have 64-bit or 96-bit memory capacities, and operate in the UHF frequency band between 868 and 930 MHz

* Class 0+ tags. Identical to Class 0 tags, but are re-writeable

* Class 1 tags. These one-time programmable (OTP) tags can be updated one additional time after being encoded, have a 96-bit memory capacity, and they operate between 868 and 930 MHz

Version 2.0 (Generation 2 “Gen2”)
* Class: there is currently a single class for Gen2 tags, which has a memory capacity from 96-bits to 256-bits and an operating frequency from 860-960MHz.

“Gen 2“ tags were recently developed to overcome encryption concerns in Gen1 tags, plus, these better integrate with ISO standards, and mitigate interference problems caused by lighting and other environmental causes. In fact, Gen2 tags will be required by Wal-Mart and the Department of Defense when their suppliers ship with RFID tags. It appears that many of the other large retailers that intend to require RFID will follow suit.

For more information on EPCglobal specifications, go to www.epcglobalinc.com.