Insider's Viewpoint: RFID Among China's Manufacturers

Filed in archive Market Size on December 22, 2005

The RFID Journal offers an interesting guest column about the state of RFID usage in Chinese manufacturing (or, perhaps non-usage would be more exact).

Steven H.T. Wong of China elite Technology opines that the business case for manufacturers using RFID is not nearly as well established in China as in the West -- and the needs are very different. He writes:

"But the prevailing argument for RFID doesn't work in China. Manufacturers here have a different set of requirements, so to catch on, RFID will have to offer them different benefits. In China, labor is cheap and widespread. Contract manufacturers utilize low-tech, mass-production techniques. With their big-brand customers squeezing them for profits, the manufacturers operate on paper-thin margins. They don't have the luxury to experiment with new technologies.

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Nonetheless, RFID's promise of better visibility is still useful for manufacturers here. Increasingly, they ask us about RFID-enabled shop floor systems for work-in-progress (WIP). They need to compare raw materials with finished goods to figure out what they're losing on the production line. They want to locate bottlenecks and identify workers who are slowing down production or creating goods that don't pass quality control. And, most important, they need to know how many units will be completed on time."

Read the whole article for an insider's view of manufacturers' attitudes toward RFID in China. The upshot: it will take much longer for RFID to gain a foothold in manufacturing in China than in the West.