Radio-frequency identifi cation (RFID) technology allows manufacturers to attach tags with antennas and computer chips on goods and then track their movement through radio signals.

RFID was developed to replace bar codes. A typical bar code, known as the Universal Product Code (UPC), is made up of 12 digits that are batched in various groups.

The first digit identifies the item type, the next 5 digits identify the manufacturer, and the next 5 identify the product. The last digit is a check digit for error detection.

Bar codes have worked well, but they have limitations. First, they require a line of sight to the scanning device. This system works well in a store, but it can pose substantial problems in a manufacturing plant or a warehouse or on a shipping/receiving dock.

Second, because bar codes are printed on paper, they can be ripped, soiled, or lost.

Third, the bar code identifies the manufacturer and product but not the actual item.

Two systems are being developed to replace bar codes: QR (for quick response) codes and RFID systems. Figure below shows bar codes, QR codes, and an RFID tag. A QR code is a two-dimensional code, readable by dedicated QR readers and camera phones.

QR codes have several advantages over bar codes:

• QR codes can store much more information than bar codes.
• Data types stored in QR codes include numbers, text, URLs, and even Japanese characters.
• The size of QR codes is small because these codes store information horizontally and vertically.
• QR codes are more resistant to damage than bar codes.
• QR codes can be read from any direction or angle, so they are less likely to be misread.

RFID systems use tags with embedded microchips, which contain data, and antennas to transmit radio signals over a short distance to RFID readers. The readers pass the data over a network to a computer for processing. The chip in the RFID tag is programmed with information that uniquely identifies an item. It also contains information about the item such as its location and where and when it was made.

There are two basic types of RFID tags: active and passive. Active RFID tags use internal batteries for power, and they broadcast radio waves to a reader. Because active tags contain batteries, they are more expensive than passive RFID tags, and they can be read over greater distances. Therefore, they are used primarily for more expensive items. In contrast, passive RFID tags rely entirely on readers for their power. They are less expensive than active tags, but they can be read only up to 20 feet. For these reasons they are generally applied to less-expensive merchandise. Problems with RFID include expense and the comparatively large size of the tags.