© 2005 LXE All rights reserved. RF-ID in Industrial Logistics Danny Mariën – LXE Belgium

2© 2005 LXE All rights reserved. Agenda Is barcoding dead ? Implementing RF-ID is simple … right ? Future applications in logistics. Examples of existing RF-ID implementations with positive ROI.

3© 2005 LXE All rights reserved. Barcoding Why use barcodes Cheap labels & printers Automatic Identification Fast No input errors

4© 2005 LXE All rights reserved. Barcoding Reading distances Check the diagrams of the barcode scanner for your specific barcode to select the appropriate scanner (SR, LR, XLR) Work backwards meaning what barcode and which scanner do I need to get the desired reading distance (ex. pallet & location labels) Colored Labels Not all label colors can be used for printing, but they don’t listen … General quality of the labels (location, box, pallet, item, …) Ex. damaged or dirty, poorly printed or applied barcodes, … Manual Labor intensive, one scan at a time, need visual, …

5© 2005 LXE All rights reserved. New Technologies Technology is Changing Fast

6© 2005 LXE All rights reserved. RF-ID : Why ? Companies will have a great deal of Supply Chain Visibility with a open global network that can identify anything, anywhere, automatically. RFID may also be used to improve safety and security. The adoption of RFID technology is inevitable. Its potential to reduce labor cost, eliminate human error at data collection points, control inventory and keep products in-stock, reduce loss and waste, will consequently improve efficiency and increase margin.

7© 2005 LXE All rights reserved. Application Host Antenna Tag On CaseReader / Decoder How does it work

8© 2005 LXE All rights reserved. Passive Tags : - Powered by energy from reader (no internal battery) - Uses backscatter technology - Smaller, lighter, less expensive - Almost unlimited life - Shorter range - Requires higher power from reader Active Tags : - On-board battery power source - On-board transmitter - Greater range but higher cost - Requires less power from reader - Finite battery life Passive versus Active Open / Closed Loop SystemClosed Loop System

9© 2005 LXE All rights reserved. Common frequency ranges cross the world: - LF 125 – 135kHz - HF MHz - UHF 433MHz, 869 – 930 MHz (US and Europe) - Microwave 2.45GHz, 5.8GHz Frequencies

10© 2005 LXE All rights reserved. Ultrahigh (UHF) Low (LF) High (HF) Permeability Range Data Transfer Rate Microwave Performance Characteristics Frequencies

11© 2005 LXE All rights reserved. How do I select the appropriate RF-ID technology for my application ? - Cost / Performance Tradeoffs - Required Range - Tag-to-Tag Spacing - Data Rate - Size Requirements - Power Requirements - Interference Issues - Noise Environment One Frequency never “Fits All” Tags selection

12© 2005 LXE All rights reserved. Future : RF-ID in Manufacturing Tracking finished goods Place an RFID tag on each case of finished goods Place an RFID tag on each pallet and associate case tags with pallet tag Each case and pallet tag has an unique serial number in addition to the company and product reference number

13© 2005 LXE All rights reserved. Future : RF-ID in the Warehouse Shipping RFID tags are read in while pallets are loaded to a truck via the shipping portal Inventory database is automatically updated and ASN generated Receiving Read a pallet full of RFID tags once at Receiving portal RFID application compares and reports what arrived vs. what was expected (ASN)

14© 2005 LXE All rights reserved. Future : RF-ID in the Warehouse Put Away Automatically update inventory w/new items & the associated location as forklift truck places pallets Picking Automatically deduct items from the inventory database as the operator picks up boxes / pallets from location

15© 2005 LXE All rights reserved. Back to real life Today : positive ROI only possible with closed loop systems. Examples :  Tags in the floor for automatic location verification at Beaulieu, Vos Logistics, …  Automatic Guided Vehicles at Flower Auction Aalsmeer  Real Time location systems at Car / RoRo Terminal, Legoland, …  Rental / Pool products at Chep, Cometal, …

16© 2005 LXE All rights reserved. Problem : Location errors in system. Pallets lost in the warehouse. Solution : Tags in the floor at every location Automatic location verification of vehicle when putting away or picking a pallet Beaulieu, Vos Logistics, …

17© 2005 LXE All rights reserved. Problem : Getting the goods from the auction area to the transport area … automatically Solution : A fixed / variable code can be set on each cart which can be read by an electronic unit in the floor, influencing the position of the diverters and sending the carriers to fixed, predetermined zones. Bloemenveiling / Flower Auction Aalsmeer

18© 2005 LXE All rights reserved. Problem : Tracking & tracing high valuable goods on the move Solution : Real Time Location System Legoland

19© 2005 LXE All rights reserved. Car / RoRo Terminal Problem : Variable location management for cars and trailers on the move Solution : Real Time Location System

20© 2005 LXE All rights reserved. Chep Problem : Identification of pool pallets, boxes, containers, … Solution : Integrated tags

21© 2005 LXE All rights reserved. Cometal Problem : Identification of rental shuttering modules Solution : Integrated tags

22© 2005 LXE All rights reserved. Conclusions  Beware of the RF-ID hype, stay with your both feet on the ground.  ROI is possible but today only in closed loop systems  Open sytems : 2005 Pilot / test projects 2006 First project roll outs 2007 and beyondROI  Consult an expert

23© 2005 LXE All rights reserved. Who is LXE  An American manufacturer of wireless rugged computers, also known as RF terminals.  30 years experience in wireless logistics  Barcode & RF-ID enabled

24© 2005 LXE All rights reserved. Questions ? Danny Mariën - LXE Belgium