RFID will not take off for at least another two years

17-Nov-2004 - Last updated on 12-Apr-2010 at 09:41 GMT

Two-thirds of UK manufacturers think that radio frequency identification (RFID) -- radio barcodes -- will not be widely adopted for at least two...

Two-thirds of UK manufacturers think that radio frequency identification (RFID) -- radio barcodes -- will not be widely adopted for at least two years, according to a new survey. In contrast 11% predicted widespread adoption over the next year.

The survey, looking at the pressures facing manufacturers, found that 67% blamed the "lack of consensus on a common industry standard" as the main reason preventing RFID adoption. It was commissioned by enterprise resource planning (ERP) software supplier Ross Systems UK, which has just released the latest generation of its iRenaissance ERP suite of software. Another 22% of respondents thought that cost was the main barrier, while 11% blamed conflicting retailer demands.

Earlier this year Tesco reported that it had delayed the roll-out of RFID because of the lack of European standards (Food Manufacture, July 2004, p4). Tesco's announcement supports the latest survey's findings.

Some other 'middleware' software suppliers are also urging caution in RFID adoption. Intelligent Distributed Controls (IDC) claims that while potentially offering improved asset management and profitability: "The technology is expensive, complex -- far more so than bar coding and, above all, difficult to integrate into existing ERP and customer relationship management (CRM) systems."

IDC claims the problems are exacerbated by users of old ERP systems unless the appropriate 'gateway software' -- such as its Simplitrak product -- is used to connect them to RFID.

When it comes to forthcoming traceability legislation, Ross's survey shows manufacturers are much more positive. 88% said they are ready to comply with the new laws which come into effect in January 2005.

Only 12% of respondents will dedicate the majority of their IT resources to RFID technologies over the next 12 months. A total of 66% of manufacturers said they would be spending most on a combination of reporting and accounting software to ensure compliance with accounting legislation. Traceability and forecasting technologies had an equal share of the vote at 11% each.

Almost a quarter of manufacturers questioned had no processes in place to measure the return on their ERP investment. The rest used the 'bottom line' to measure returns.