RFID tags – What they are and how they work

Jun 24, 2025

Have you ever wondered how stores control their inventory so efficiently or how access is managed in modern buildings? The answer often lies in a fascinating yet unobtrusive technology: RFID (Radio-Frequency Identification) tags.

In this post, we’ll reveal everything you need to know about these smart labels: what they are, how they work, their incredible applications and in which sectors they are making a difference. Get ready to discover a world of possibilities!

What are RFID Tags?

Imagine a tag that can store information and communicate wirelessly via radio waves. That is, in essence, an RFID tag. Composed of a small microchip and an antenna, this tag attaches to objects, animals or even people to uniquely and remotely identify and track them.

Unlike barcodes, RFID technology does not require direct visual contact for reading, allowing multiple items to be identified simultaneously and remotely, streamlining processes and collecting data efficiently.

How do RFID tags work?

The operation of an RFID system is based on the interaction between the tag and an RFID reader. Here we explain the process step by step:

  1. Activation: The reader emits radio frequency waves through its antenna.
  2. Tag Response: When an RFID tag enters the field of these waves, the electromagnetic energy induces a current in its antenna, activating the microchip.
  3. Data Transmission: The microchip modulates the received radio waves to transmit the stored information (a unique identifier, product-specific data, etc.) back to the reader.
  4. Reception and Processing: The reader’s antenna picks up the tag signal and sends it to the reader, which decodes it and transmits it to a computer system for processing and analysis.

There are mainly two types of RFID tags:

  • Passive: They have no internal power supply. They are activated by the energy emitted by the reader and have a limited reading range (usually a few meters). They are less expensive and have a longer lifetime.
  • Active: They incorporate a battery that allows them to emit their own signal and have a greater reading range (tens or even hundreds of meters). They are more expensive and have a limited battery life.

RFID Tag Applications

The versatility of RFID tags has led to their adoption in a wide range of applications, transforming the way we interact with objects and manage information:

  • Inventory and Logistics Management: Real-time product tracking, supply chain optimization, warehouse stock control, shipping and receiving management.
  • Access Control and Security: Identification of personnel, access to buildings and restricted areas, burglar alarm systems.
  • Retail: Loss prevention, in-store inventory management, personalized shopping experiences, self-payment.
  • Healthcare: Patient and staff tracking, medical records management, equipment and medication control.
  • Public Transportation and Tolls: Contactless payment systems, fleet management, luggage tracking.
  • Animal Identification: Tracking of livestock, pets and wildlife for management and security purposes.
  • Libraries and Archives: Loans and returns management, inventory control.
  • Events: Access control, attendee tracking, payment management.
  • Industry: Tool and equipment tracking, production process control, asset management.

In Which Sectors Are RFID Tags Making a Difference?

The adoption of RFID technology is booming in various industries seeking to improve efficiency, security and traceability:

  • Logistics and Supply Chain: Route optimization, real-time visibility of shipments, reduction of losses and theft.
  • Retail: Improved inventory management, theft prevention, personalization of the customer experience.
  • Health: Increased security in the identification of patients and medications, efficient management of hospital assets.
  • Manufacturing: Production control, component tracking, equipment maintenance management.
  • Food: Product traceability, temperature control and storage conditions, quality assurance and food safety.
  • Automotive: Parts inventory management, vehicle tracking in the production and distribution chain.
  • Textile and Fashion: Inventory management in stores and warehouses, counterfeit prevention.

Conclusion: The Smart Future Is Labeled

RFID tags are much more than just stickers; they are the gateway to a world of data and possibilities. Their ability to identify, track and manage objects wirelessly is transforming entire industries and improving our daily lives in ways that often go unnoticed.

As technology continues to advance, RFID tags will become even smaller, more powerful and versatile, opening up new applications and establishing themselves as a critical tool for efficiency and intelligence in an increasingly connected world.

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