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Every business wants to get complete clarity over its assets. But it’s not always easy to know which asset tracking solution to use: barcodes or RFID tags.
Barcodes are an excellent choice and offer a great entry point to any business getting started with asset tracking. RFID tags also have plenty of benefits, but the myth that they are prohibitively expensive can stop some businesses from adopting them — even if they would provide a better asset tracking solution in the long run.
That myth ends today. As we’ll discuss in this article, while the cost of RFID tags may be slightly more upfront, they can be incredibly cost-effective in the long run. If you want to get the lowdown on how much an RFID tagging system costs, keep reading.
What is an RFID tracking system?
RFID tags are small electronic devices that store information and use radio waves to communicate with other devices — hence the name (RFID is short for radio frequency identification).
RFID tags can be placed on almost any fixed asset, from machinery to computers, with readers in fixed locations. The data transmitted from tag to reader is typically stored in a computer system or software so users can access asset information quickly and easily.
RFID tags can be used in various applications, including inventory, asset management, and payment systems. One of the benefits of using RFID tags compared to an alternative like barcode stickers is that they can be scanned without being visible, and you can scan multiple tags at once.
While RFID tags don’t need to be visible to work, using a consistent placement system makes sense. This will make it easy to ensure each asset is tagged appropriately and that tags can be removed or replaced with ease.
Like barcodes and other asset-tracking solutions, RFID systems use scanners and software to read and store data. But unlike other asset tracking solutions, RFID tags contain microchips — which can make them more expensive. That doesn’t make them unpopular, however. The RFID market is set to be worth $15.72 billion by 2027.
There are three types of RFID tracking systems:
- Active
- Passive
- Semi-passive
Active RFID tags come with their own power source (usually a battery), transmitting a continuous signal. These tags monitor processes in real-time (think tracking a vehicle) and can transmit a range of about 150 meters or 500 feet.
Passive RFID tags don’t have an internal power supply. Instead, they are powered by an antenna or RFID reader. This means the range is shorter, but they also tend to be cheaper. You can add or remove passive RFID tags as often as you wish, which makes them more common in inventory tracking.
Semi-passive RFID tags use a combination of both technologies. They have an internal battery, an antenna, and an RFID chip. You get a smaller signal range than active tags, but they allow for real-time monitoring. These tags tend to be used when monitoring the environment, like in a temperature-controlled area.
What are the costs of an RFID tracking system?
To purchase, install, and deploy an RFID tracking system in your warehouse or office takes some investment — but it may not be as much as you think. Below, we break down the common costs of an RFID tracking system.
Tag cost
As we have already explained, RFID tags are more expensive to purchase than other asset tracking methods like barcodes because they include a microchip and integrated antenna. But exactly how much an RFID tag will cost will depend on the type of tag you buy.
Active tags are more expensive than passive or semi-passive tags. These tags can be ten times as expensive as their passive counterparts, but many businesses will accept this cost because of the other cost-saving benefits of active tags that we’ll discuss below.
Passive RFID tags can cost less than a dollar each. While this is far more than a barcode sticker, it’s a manageable expense for most businesses. This only changes if you need to tag metal equipment. Because metal interferes with the radio waves, special tags are required in these situations, which cost more.
Scanner cost
Scanners are vital to any asset-tracking solution, and RFID solutions are no different. You’ll need a near-field communication (NFC) scanner to read an RFID tag, which activates the tag’s microchip using radio waves. The great thing about scanning RFID tags is that you don’t need the internet to access the information, and tags can be scanned from any direction — even from a distance and behind objects like walls.
A high-end scanner will cost between several hundred and several thousand dollars. Bear in mind that active RFID scanners are more expensive than passive scanners.
Of course, you’ll need more than one reader, too. If you want to automate your RFID tracking system as much as possible, you’ll need a dense network of readers and will have to budget accordingly. For example, you could need as many as an RFID reader at every entrance point across your warehouse or workspace.
Software cost
Forget about spreadsheets and other manual methods of keeping track of your fixed assets. No RFID tagging system is complete without asset management software. It’s the best way to manage data at scale, streamline processes, improve asset visibility, and ensure compliance.
These tend to be cloud-based SaaS platforms that come with a monthly fee. They aren’t expensive — and the benefits far outweigh the cost — but you’ll still need to consider monthly fees. If in doubt, you can use RedBeam’s ROI calculator to estimate how much you can save using our asset management platform.
Installation cost
Some types of RFID systems will need to be installed by an expert. Here, passive systems are more expensive as antennas in each tag will need to be directed and tuned according to scanners. This can take time and requires several connectivity tests to ensure the system works properly.
Active RFID tagging systems tend to be much cheaper in this respect. Anyone can install them (but it’s usually an IT team member) in less than a day. With active RFID tags, you don’t need to worry so much about the placement or tuning of the tags.
Ongoing license cost
Some RFID systems, especially passive ones, require ongoing licensing costs to contribute to support and system upgrades. These can become prohibitively expensive and must be considered carefully when choosing between an active and passive system. For example, you may be put off by the cost of active RFID tags initially, but ongoing licensing costs can quickly make passive systems more expensive than their active counterparts.
Maintenance cost
There are small ongoing maintenance costs that come with both active and passive RFID tags. For instance, equipment can get dislodged or go offline, which is more common with passive systems than active ones. That’s because these systems tend to be larger, have complex networks, and be at greater risk of being bumped.
Some RFID tags (mostly active ones) include batteries, which means proactive monitoring and replacement is necessary. You’ll need to factor in the cost of batteries if they can’t be recharged, too.
How do RFID tags compare to barcodes?
Barcodes and QR codes are incredibly common forms of asset tracking. The codes themselves are easy to create and print. Companies can often do this themselves without paying a third-party company.
The scanners used to read barcodes also tend to be cheaper. They are affordable to purchase, but this isn’t even necessary in many cases. Most smartphones can read barcodes and QR codes, meaning employees can use personal or corporate phones instead. These are just some reasons we recommend clients use barcode stickers when building an asset tracking system. Yes, they can get marked and aren’t as easy to scan as RFID tags, but they work almost perfectly for most use cases.
In some cases, however, it may make sense (both from a fiscal and productivity standpoint) to use RFID tags instead of barcodes, even if they are more expensive to implement at first.
The benefits of RFID tags
RFID tags have some unique advantages compared to other tracking systems, which can lead to cost savings in the long run.
For example, RFID tags are automatically scannable and can be read faster than others. Using them can eliminate many manual tasks, especially with an automated asset tracking system that notifies you in advance when assets need maintenance. That can save your team significant time and effort that can quickly add up. Do you want your team to spend an entire day doing asset inventory, or would you rather have it completed automatically with an RFID system?
RFID tags may be more expensive but are also much more durable. They don’t peel off; they can’t be defaced or destroyed. That means you should only need to purchase them once, and you won’t have to waste time printing and replacing new stickers, either. RFID tags can also be rewritten, meaning you can reuse an asset tag for a new piece of equipment when replacing an old one.
RFID tags can store significantly more data, making them necessary for some businesses. And they can also provide real-time data that can be used to improve decision-making. Using RFID asset tags lets you get precise data about the location and condition of assets, which can help you reduce maintenance costs and minimize future downtime. This benefit may be hard for some businesses to quantify, but it will almost certainly make investing in RFID tags a profitable decision.
Whether you use RFID tags or barcodes, choose RedBeam
RFID tracking is one of the best ways to effectively and efficiently manage your assets at scale. These tags may look expensive, but they can offer significant benefits and cost savings in the long run.
Whether you want to invest in RFID tags or use a more cost-effective solution like barcodes or QR codes, RedBeam is here to help. Our asset tracking software can help you streamline and automate your asset management process regardless of which tagging method you use — saving you time and improving your bottom line. Try it now for free.
