You've probably heard about those tiny chips that can track the products to which they are attached, known as Radio Frequency Identification (RFID) tags. As a small business owner who is constantly looking for opportunities to improve the way you manage your products, the innovation that RFID offers is intriguing.

RFID is becoming a vital supply chain management, manufacturing, retailing and agricultural device. By essentially allowing products to self-track, RFID has emerged as the front-running technology for everything from stocking shelves and tracking assets to managing production and shipments. As more large businesses and corporations begin to integrate RFID into their supply chains, the demand for small and medium-sized enterprises to follow suit grows.

If used effectively and responsibly, RFID technology can be very beneficial to your business. However, you need to keep in mind privacy issues surrounding its use in the marketplace. Many consumers are concerned that RFID-tagged products, post-purchase, continue to be monitored.

The key is to understand how RFID can help your business and to examine privacy safeguards around the tagging technology on behalf of your customers.

For a brief overview of how RFID technology works, as well as its privacy implications, check out Industry Canada's Office of Consumer Affairs' RFID Technologies and Consumers in The Retail Marketplace.

Want to know how to go about implementing RFID into your business? Radio Frequency Identification (RFID): Beyond Customer Mandate is an in-depth report from Supply Chain and Logistics Canada and Industry Canada.

Looking for resources that will help you implement a privacy policy to best protect your customers? Check out the Privacy and your Business section of our website.