A simple RFID cost model for the container shipping industry

Radio frequency identification (RFID) refers to the use of a transponder or tag affiliated with an object for the purpose of identification and tracking using radio waves. While conceptual ideas and potential applications are widespread, its use within maritime shipping still needs to be advanced. That is, the shipping industry still seems to be hesitant regarding RFID investment decisions. This paper proposes a simple cost model, which is applicable for RFID investment decisions. We show that under reasonable assumptions RFID may provide moderately quick ROI and we discuss relevant factors to be used in business scenarios. In particular, the construction and the origin of these factors are explained, thus allowing an understanding that RFID usage may have real business impact in maritime shipping.