CIO — Retailers are being promised big benefits with the use of small radio tags that can automate inventory and even customer checkout. Wal-Mart, for one, is pushing its suppliers to use these passive radio frequency identification, or RFID, tags, whose costs are heading toward a nickel apiece. Although bar-code labels cost only about a penny, the labor required to scan each box of cereal more than offsets RFID’s price.

But there’s another kind of radio tag that promises more benefits before products hit retailers: real-time location system (RTLS) tags. Unlike RFID tags that respond only when probed by a detection device, RTLS tags are reusable and they have a radio that transmits a signal every few minutes. RTLS tags can cost anywhere from $20 to $60, so their use is limited to pricier items such as cargo containers and automobile fleets. But they offer active location information that lets enterprises actively manage their assets, either within a fixed environment using wireless local area networks or over a wide territory using a global positioning system.

NYK Logistics, the U.S. division of Nippon Yusen Kaisha, a Japanese shipping conglomerate, is using them in its facility near the Port of Long Beach, Calif., to find containers bound for rail and trucks.

NYK’s facility works with 11 trucking companies, four drayage companies and a dozen shipping lines. Increased volume meant NYK had to drop its old system of having workers search the 70-acre yard manually, using bar-code scanners to confirm each container’s identity before loading them onto the transports, says NYK Logistics General Manager Rick Pople.

A container that has a bar code "still has to be married to a location, which still involves driving around to see where they are," Pople says. "And if a hostler doesn’t follow instructions properly, location information will be wrong, complicating the movement of containers."

RTLS tags were the answer. Each container gets one as it enters the yard. The active wireless tag (the size of a small pager) transmits a signal every two minutes, though that frequency can be changed. A set of 35 access points monitors its signal, using triangulation to determine location among the 700 containers and 300 trailers that are in the yard daily. The system also sends pickup instructions to wireless devices mounted in six tractors in the yard.

Tying together the 802.11b network and the RTLS tags is a yard-management software system combined with a network and communications package from WhereNet, which also provides the wireless tags and access points that handle both the 802.11b signals and the tag signals. The locating access points have a range of 700 feet to 1,000 feet outdoors, and 200 feet to 300 feet indoors. Their batteries typically last five to seven years.

Pople says he expects ROI within a year on an investment of between $700,000 and $1 million, not much more than a bar-code system, which requires more labor.

"RTLS is definitely a huge savings in terms of manpower," says Edward Rerisi, research director at Allied Business Intelligence, a technology research think tank. "Hopefully, it empowers the facility to make better use of its existing labor pool."