Adding RFID to pallets

By Bob Trebilcock, Editor at Large -- Modern Materials Handling, 2/14/2005

Pallet pools would seem like a natural for RFID tags.

CHEP (407-563-2000), one of the leading providers of pallet management programs, has been working with the technology since 1998.

Initially, CHEP was looking at RFID to provide internal benefits. By embedding an RFID tag in its pallets, the thinking went, CHEP would know exactly how long a pallet had been in the supply chain, which would lead to more accurate billing. The pallet provider would also be able to link repairs to specific customers. In the long run, that information could be used to reduce damage.

Presently, that’s on the back burner. “For now, the cost-benefit equation of installing tags on 80 million pallets in the U.S. plus equipping our service centers doesn’t work out,” says Per Ohstrom, CHEP’s director of marketing. “Instead, we’re focusing on customer benefits.”

To help customers comply with mandates, CHEP has developed a special 256 bit Class 0+ RFID tag encased in a plastic cover. The cover is then folded around two sides of the center block of a CHEP pallet. The plastic cover offsets the tag so that moisture in the wooden block doesn’t interfere with the signal. Placement on the center block protects it from lift truck damage.

While a customer of CHEP’s PLUS ID pallets can write some information to the tag, the real value is having permanent license plate information about the pallet. That allows a user to associate its containers and products with a specific pallet.

CHEP has been testing the pallets in the U.S. and Europe, and is currently working with Accenture to determine opportunities for RFID in Brazil. “The trials have clearly demonstrated that 100%-read pallet level can be achieved,” says Ohstrom.