Royal Mail to spend £2m on RFID

The Royal Mail is to implement RFID in its supply chain.

Following a recent review of its quality of service targets by mail watchdog Postwatch, the Royal Mail hinted that it would be looking at the technology to better track items in its supply chain in its response to the regulator.

"Royal Mail is currently considering the use of... RFID as part of end-to-end measurement surveys," the report says. However, speculation has grown that the Royal Mail has moved from considering a rollout to planning to implement the technology.

BT will be partnering the Royal Mail in the rollout, silicon.com has learned.

Haydn Britton, general manager of BT Retail, said that the Post Office parent will be spending £2-3m on the technology to ensure it improves its mail services and thereby manages to avoid a £70m fine from Postwatch for missing efficiency targets.

Royal Mail CIO David Burden would not be drawn on the project but did say the technology will be used in future "to monitor the flow of mail through our pipeline, in order to identify bottlenecks and improve quality of service".

The technology is not yet in place and RFID tags won't be used to track parcels and packages, he said.

Airline companies are also turning to RFID to help them track easily lost items. A report from airline industry IT body SITA said that using RFID could cut baggage handling errors from 15 per cent to five per cent.