How to Choose an RFID Inlay for Retail Inventory Management

1. How to Choose an RFID Inlay for Retail Inventory Management Six Attributes of High Performing RFID Tags By Dr. Jeremy Liu

2. The Proof is Out There. No, we’re not paraphrasing the tagline from “The X Files”. We’re pointing to leading global retailers that have put RFID through its paces and publicly stated the benefi ts, proving that it increases inventory accuracy, decreases losses, improves customer service, and boosts profi tability by getting in-demand items in the hands of customers when they want them. It also means that RFID adoption is gaining speed, leading to many questions from retailers who are looking much more closely at the technology and what it can do for their operations. One of the questions retailers ask is this: What’s the best tag? Entirely valid and important, when one looks at the fact that the tag is one of a number of system components that must all work together to create business value for the retailer and the brand owner. If the tag is not high quality and with consistent high performance, then the business value will never be achieved. This highlights the importance of and the smallest but highest occurrence part of an RFID system, the RFID Tag. Since SML is a leading RFID solution provider, with over 5 billion RFID transactions across our Clarity™ solution in 2016, we have a unique perspective on the importance of consistently high-performance inlays, and we use this perspective to develop better inlay products. But here’s the rub. There’s a better question: What makes a good inlay for a specifi c retail application? It’s not an easy query, because important variables go into the answer, and you can thank the RFID early adopters for refi ning the discipline and science of RFID tag development. They used RFID tagging for a number of diff erent applications where company management and supply chain pros found the attributes that make up the right inlay/tags for their needs. Through our experience with early adopters, we’ve designed numerous inlays that deliver the consistent performance that is required within the apparel supply chain. One of the most versatile inlays we have developed is named the GB3. Here are some examples of characteristics that make this inlay an industry-leading inlay for the retail market. 1. The Optimal Size What size inlay will fi t YOUR hang tags and labels? The GB3 inlay antenna size is 50x30mm, the perfect size. How did we arrive at that optimal dimension? Typical apparel tag sizes (in inches) are 1.5x2, 2x3, 2x4, 1.5x3 and 1.5x4. Now to reach a one-size-fi ts-all dimension took some engineering. That means getting a bit technical here. Traditional long-range UHF inlays are manufactured with an RFID chip attached to a dipole antenna that totals 160 mm (6 inches) in length. With the GB3 inlay, we altered the antenna minder-lines and the center loop for matching the imaginary part of the impedance, signifi cantly reducing the size of the antenna to within 2 inches. What all that means is an inlay antenna that only measures 1.18 x 1.96 inches, which can fi t on most of the apparel hang tags or labels used around the globe. What’s more, the GB3 inlays can be either converted to hang tags or wet/paperface labels, which can be both in single piece or roll format. ................................................................................................................................................................................................................................................ © 2017 SML RFID is a division of SML Group Limited 2

3. 2. Tailor Made for Apparel and Garments After a careful study of the dielectric properties of retail apparels, RFID application is grouped three ways: (1) Hang tags (2) Medium load case (3) Heavy load case To see how well the GB3 performs in the retail wild, we tested them as a simple Hang Tag on cardstock, the Medium load case as the inlay in the two polybags, and the Heavy load case as the inlays in stacked jeans (pictures above). Again, more science: The frequency shifting between the case (1) and case (3) can be maximized to 150MHz. Therefore the GB3 inlays were designed to resonate on multiple frequencies, and those frequencies were carefully selected so they can fi t for all materials. Testing on the diff erent cases shown, the GB3 inlays perform very well over all the circumstances stated above. 3. Global RFID Frequency Coverage In July 2016, GS1, the people who standardize barcoding, reported that 98 percent of its member countries have deployed UHF-passive RFID using frequencies within 860~960MHz. The other two percent are not available yet. Most countries are using 902~928MHz as the UHF RFID frequency. European countries, for the most part, use 865~868MHz. The global UHF RFID frequencies put a requirement on the RFID inlay antenna to have a broad frequency bandwidth. With a simple test for an inlay on the most heavy (10) stack of jeans, the GB3 inlay sensitivity is lower than -16dBm with a reading distance higher than 10 meters based 4W EIRP in 800~980MHz. Meaning? This range is broad enough to cover the global 860~960MHz… by a big margin. ................................................................................................................................................................................................................................................ © 2017 SML RFID is a division of SML Group Limited 3

4. 4. Two Choices for ICs For inlays to work, you need integrated circuits (IC). Two of the world’s largest IC makers are NXP and Impinj. They’ve come out with their new generation ICs named UCODE7 and MonzaR6. Both pack sensitivities that already exceed -20dBm. Because they off er diff erent functions and memories, the SML GB3 has been designed with the following two diff erent options: IC Manufacture IC Model EPC Serial TID User Memory GB3U7 NXP UCODE7 128 bit 48 bit – GB3R6 Impinj Monza R6/R6P 96/128 bit 48 bit 32/64 (R6P) SML’s product range is comprehensive and includes Alien ICs as well, allowing buyers to conveniently select the RFID IC that has the data format and features – such as passwords, kill commands and encryption – that they require. 5. ARC Certifi ed What would the world be like without performance standards via an objective third party? So, naturally, RFID has its own through the RFID Lab at Auburn University. Its mission is “… to ensure that retail suppliers are able to deliver RFID tagged product to retailers that meet or exceed the levels of performance necessary to provide benefi t to both the retailer and the retail supplier in a consistent and cost eff ective manner.” To let buyers know how well inlays perform, the ARC Program devised categories of RF performance requirements, displayed in the table below. With so many categories, it’s extremely diffi cult for a single manufacturer to pass all categories. Except one. Only the GB3U7 and GB3R6 do. ................................................................................................................................................................................................................................................ © 2017 SML RFID is a division of SML Group Limited 4

5. 6. The Orientation of GB3 is the Best Fit for Retail Apparel The entire premise of affi xing an RFID inlay to a hang tag is so the article of clothing the tag is attached to can be easily tracked. Optimally, you want that piece of clothing to be located at any time through the supply chain, and in the store. The above picture is the orientation pattern of GB3 inlay. Likely you’re not familiar with the readout, but the pattern shows a 4-meter reading distance. The omni-directional pattern the inlay emits is very important for retail apparel because the GB3 inlay eliminates blind spots. A more trackable piece of apparel means a more saleable merchandise item. So evaluating RFID inlays comes down to size, resonant frequencies, performance, multiple IC options, certifi cation and radiation orientation. As you consider an RFID solution, the SML GB3 inlays provide optimal performance for the retail apparel industry. About the Author Dr. Jeremy Liu has a PhD in electrical engineering, with a focus on antenna & wireless technologies and RFID systems, providing leading innovation for over 15 years in the RFID Industry, from inlay antenna design to RFID application experience, including 43 papers and over 40 patents on robust control systems, RFID systems and antenna technology. ................................................................................................................................................................................................................................................ © 2017 SML RFID is a division of SML Group Limited 5

6. SML RFID LEADS THE NEW ERA IN RETAILING About SML As the leading full-service RFID solution provider, SML is a trusted partner to the world’s largest retailers and top fashion brands, delivering proven results and rapid ROI for our customers. SML offers a broad spectrum of certified RFID-enabled labels, tags, stickers and inlays from the largest global network of source-tagging service bureaus. SML Intelligent Inventory Solution’s Clarity™ enterprise-class platform has best-in-class features and functionality for RFID deployment in-store and throughout the retail supply chain. SML has successfully delivered RFID to many of the world’s most successful retailers. With a presence in over 30 countries, unparalleled deployment expertise and highly trained support personnel, SML is the leading technology provider for the new era in retailing, Retail 3.0. Visit the SML website at www.sml-rfid.com. @SMLRFID www.sml-rfid.com SML RFID info@SML-RFID.com ................................................................................................................................................................................................................................................ © 2017 SML RFID is a division of SML Group Limited W05201703A