October 20 th , 2009

1. October 20th, 2009 Welcome Nashville APICS Group Presenter: Paul Reed, President, BRS 1585 Mallory Lane, suite 105, Brentwood, TN 37027 615-377-8849 x2903 Paul@ThinkBRS.com

2. What is RFID Technology? • How does it work? • Who currently uses RFID? • How is RFID being used today? • What are the limitations? • What are the advancements? • What does the future of RFID look like? • How do I implement RFID? RFID Outline Questions we’ll cover:

3. RFID = Radio Frequency Technology • RFID uses a Radio Frequency Field to identify a person, animal or object • It includes an antenna, transmitter and a reader and a tag RFID offers: • Faster and Unique ID for track & trace • Security: Not easily replicated or counterfeited • Large memory and high read-write What is RFID?

4. Components of RFID • RFID Tag acts as transmitter with memory (microchip) embedded within • Types of Tags: • Active: use a battery to transmit a signal (~500 + ft) • Passive: No battery but draws power from reader (~50ft) • Reader: An electronic device used to retrieve data from a tag • Antenna: Receives and transmits electromagnetic waves

5. RFID Tag Antenna Tag receives signal Reader broadcasts signal through antenna Tag is charged with enough energy to send back an identifying response Reader sends info/data to computer system for collecting, logging and processing Computer System How Does RFID Work? Reader

6. RFID vs. Barcode • Barcode technology must look to scan, one item at a time • RFID can scan the chip without visual contact • RFID can scan numerous items (10-100 tags) simultaneously • Barcode = Sight • RFID = Sound

7. Supply Chain Management • Passports or ID cards • EZ Pass on Toll Roads • Access Cards for Security • Airport Luggage • Library Check outs • Real time inventory control • Tracking surgical equipment • Homeland Security • Counterfeit Identification • Ensures Quality and freshness of produce How is RFID used Today?

8. Who uses RFID? • Department of Defense • Healthcare Facilities • Airports • Warehouses • Ranchers (Livestock) • Wal-Mart • Many more

9. Limitations • RFID cannot not easily function near or on • Liquid • Metal • Radio Frequency Interference • Too many RF devices can interrupt the signal • Environment • Outside (extreme cold or heat) • Readers don’t need line of sight to read tag but can only read in certain area

10. New Tags designed to function on metal • Tags and readers built to withstand extreme conditions • Humidity • Extreme cold and heat • New Equipment with Further Read ranges • 500+ feet • RFID in Healthcare • Medical/surgical devices, O.R. • RFID in Fashion • Counterfeit prevention • RFID in Trucking • Tire monitoring: pressure, mileage, rotation Advancements in RFID

11. The Future of RFID • Automated Grocery Store Check outs • A World Without Checkout Stations • RFID Patient locator in Hospitals in case of disaster • RFID teaches the deaf how to sign • Strides towards an RFID robotic eye seeing dog • RFID in Agriculture: • Use of RFID to monitor strawberry temperatures during shipments

12. Case Studies • Case Study 1: Chicago Aquarium • RFID Interactive submarine • Case study 2: Pneumonia in Pakistan • Doctors track patients and symptoms • Case Study 3: Newmont's Leeville Gold Mine (NV) • Use RFID to track workers and equipment

13. Logistics Case Study Overview • Problem: A medium size Belgian Logistics company • was debating the use of RFID but didn’t know the ROI • Goals: • To deploy the use of Passive Ultra High Frequency Tags (UHF) that meet the EPC standards • To use a permanent UHF tag for each container • Advantage: Deployment of RFID typically saves labor cost and reduces error • Disadvantage: If RFID does not save labor costs near 50% or reduce errors by 10%, the ROI may not be worth deployment

14. Logistics Case Study – RFID and ROI • Step 1: • The Logistics Company tested and recorded their current shipping and processing time (~ 30-40 shipments/wk) • Step 2: • The Company then deployed and tested their average time and shipments with RFID

16. The Actual Cost without RFID • Total cost for RFID implementation for Logistics Company (i.e. tags, readers, handheld readers, software, training and maintenance) is ~ $172,200 • The average Belgian employee’s salary = $26.05/hr • Cost of 1 employee’s labor for average shipment without RFID= $69.30 (2.66 hours at employee’s $26.05 pay rate) • Without RFID= 35 containers/wk which equals 1,680 containers/year • 1,680 containers x $69.30 = $116, 424 total annual labor cost per employee

17. The Actual Cost with RFID • Total time for shipmentwithRFID recorded as 36min. 30 seconds VS. 2.66 hours without(as displayed on chart) • Total cost for shipment with 1 employee with RFID equals: $15.89 (.61 hours x $26.05) • Total Annual cost for 1,680 containers = $26,695 (15.89 x 1,680) • Total Annual Savings = $89,730 ($116, 424 - $26,695 )

18. ROI with RFID Solution: Payback period would be around 24 months, meaning implementation of RFID would be a wise decision

19. Implementation • Know RFID Standards • Technological updates found on EPC Global website: epcglobalinc.org • Evaluate your resources • Determine times for compliance and develop a budget for implementation • Estimate your ROI for the project • Determine if you want to incorporate a compliance package (i.e. Wal-Mart, DoD, Metro) with your existing auto tracking

20. Thank You If you have any questions about RFID, Barcode Needs or Custom Software, Think BRS! www.ThinkBRS.com Paul Reed, President 1585 Mallory Lane, suite 105, Brentwood, TN 37027 615-377-8849 x2903 Paul@ThinkBRS.com