Before we go galloping ahead working on the principle that everyone knows what RFID is perhaps a short explanation is in order. RFID stands for radio frequency identification. Think of it as a bar code that does not need a reading device waved over it.

The concept has been around a long time. In 1946 Léon Theremin invented an espionage tool for the Soviet Union which retransmitted incident radio waves with audio information. This was meant to pick up sound — a passive covert listening device — but it was the first known RFID device. In theory there are three varieties — passive, semi-passive (also known as battery-assisted), or active.

Passive RFID tags have no internal power supply because they are microchips and some are a third of a millimeter across and we do not, as yet, make batteries that small. The chips act as transponders (transmitters/responders), listening for a radio signal sent by transceivers, or RFID readers.

So an RFID chip, perhaps fastened in the hem of a dress, receives a certain radio query, it transmits its unique ID code — typically 128-bit number — back to the transceiver.

Most of these will work from somewhere between a few inches and a few feet away. Bigger ones, with batteries, can be read over considerable distances as in a kilometer.

At the moment RFID chips cost something well under 50 cents. They are mandatory because WalMart insists on them and if the biggest potential customer in the world demands, manufacturers respond. Because of massive volume prices are heading downwards and soon they will be a few cents in which case the bar code will start to disappear.

Sorry about the length of that but people keep banging on about RFID codes without telling you what the blessed things are.

Now Metro, the world’s fourth largest retailer, is expanding its Advanced Logistics Asia RFID pilot to include 30 Chinese suppliers. The company has teamed with Checkpoint Systems to provide RFID labels for the participating suppliers.

Gerd Wolfram, Metro Group Information Technology’s managing director for advanced technologies, ‘We have been testing RFID in our supply chain from Asia since late 2005. We’ve been achieving good read rates, and everything has been working fine. So we decided to have a supplier event here in Asia and do a bigger test with more participants.’

How does it work? In the original scheme a third-party logistics provider, Fat Kee Stevedores, and a small Chinese supplier worked together to tags to containers loaded with cartons of various goods to be exported, including pens and kitchen gadgets.

At the Fat Kee facilities in China, the packages are pushed through an RFID portal. After the system reads the tags, software creates an electronic packing list, which is sent electronically to a Metro subsidiary in Hong Kong to be checked for accuracy. The list is then used to generate an advance shipping notice (ASN), which is sent to Metro headquarters. When the goods arrive at a Metro distribution center in Unna, Germany, the system reads the tags and checks them automatically against the ASN.

In other words checking from a created packing list is pretty well automated.

This work and Metro decided to expand the system to additional suppliers in Asia under the catchy if slightly banal title of ‘Tag it Easy’

The RFID tags on the labels, provided by Checkpoint, will store data. But some suppliers don’t have an RFID reader, so the label will also bear a bar code containing an 18-digit number will be read at several points along the supply chain.

Metro expects to use 30,000 RFID labels during the pilot.

Gerd Wolfram said, ‘We will consider the pilot a success if we achieve high read rates in Germany for the 30,000 packages, and if we have positive feedback from our suppliers — if they say they would like to use this solution and integrate it into their shipping operations.’