The so-called tag, which is a tiny chip with an antenna, is at the heart of RFID technology. The tag is embedded in a razor-thin label which can be stuck to palettes, boxes and products. The transponder is also known as a smart chip. A so-called Electronic Product Code (EPC) number is stored on this chip. The EPC includes, along with the Global Trade Item Number (GTIN) - formerly EAN, a nine-digit serial number. These numbers are used to unmistakably identify shipping units or single items. The principle is quite similar to a car number plate: only a limited number of people have access to process and product-related information stored in a data base.

Number codes are read with an RFID reader. Readers can record the EPC details stored on the RFID tag from a distance of several meters, depending on the frequency used. Readers do not have to physically “see” the label to identify it. Specific features such as price, weight, best before date or serial number are matched to a product using a special systems infrastructure. The features are stored in the trading company’s data base and can be retrieved by authorized users. RFID readers are either installed in goods entry/exit gates of a store’s warehouse or integrated into so-called, intelligent shelves. Portable readers are also available: workers can use these devices to check tagged palettes and products in the store and warehouse in passing. Fork lifters with built-in readers are already being tested in the workplace. They enable the drivers to quickly and accurately transport the goods to their intended warehouse location.

Basically, RFID tags can be active or passive. The passive type operates without its own power supply. As soon as an RFID reader transmits an electro-magnetic field, the smart chip receives this signal and sends back the electronic product code (EPC) which is stored on the chip. Active RFID transponders on the other hand are equipped with their own battery and transmit their information to the respective reader without being “prompted“.