RTLS vs RFID: Understanding the Difference

Organizations looking for a solution to track their assets (inventory, equipment, people) in their facilities often look at both RTLS (Real-Time Location Systems) and RFID solutions. Yet, the two technologies are very different and aim at solving different problems.

RFID Technology

RFID (Radio Frequency Identification) is a technology where battery-less (passive) RFID Tags are energized by a nearby RFID Reader, up to a few meters (10’) away. The RFID Tag then uses the energy captured from the RFID Reader to send its unique identification number back to the RFID Reader. RFID is essentially an improvement on barcodes because it doesn’t require the same accurate positioning between the RFID Reader (~the barcode scanner) and the RFID Tag (~the barcode).

Due to their limited capabilities and battery-free operation, RFID Tags only cost a few cents.

The need for close proximity between the RFID Tag and the RFID Reader is a consequence of this battery-free design. It is also the reason why RFID cannot be used to position devices in a building or in an outdoor yard: Chances are small that the RFID Tag is in view of an RFID Reader at any given moment. Outfitting an entire warehouse with RFID Readers is also not technically possible.

RTLS Technology

RTLS or Real-Time Location Systems use battery-powered (active) Tags; they don’t rely on a reader to be energized. They can send messages whenever required, for example when they have sensed motion and want to transmit a new location, or because a temperature sensor reached an alarming level.

RTLS relies on a network of Anchors installed throughout the facility, typically at a 50ft/15m distance between Anchors. The Tags do not need to be in close proximity to the Anchors and there can be obstructions in the line of site. As a result, RTLS solutions are capable of providing full wireless coverage of a facility.

RTLS Tags are capable of more complex tasks than RFID Tags, therefore they are more expensive. An RTLS Anchor is typically 5 to 10 times cheaper than an RFID Reader, and, in some RTLS systems, the Anchors are also battery-powered, avoiding the cabling cost associated with RFID readers.

RTLS technologies exist in different flavors: Wirepas, Bluetooth, and WIFI-based solutions are the most affordable and offer a typical positioning accuracy of 16ft/5m. UWB-based solutions are more expensive and offer an accuracy below 1.5ft/0.5m.

RFID Use Cases

RFID use cases essentially align with barcoding use cases because the technologies are conceptually similar. RFID use cases are:

  • Inventory counting: Either the inventory is brought close to an RFID Reader or  an RFID Reader is built into a mobile scanner and is brought to the inventory.
  • Transaction recording: Goods are scanned when they move from one workstation to the next, such as from the incoming warehouse to production, then to assembly, then to packaging, and finally to the outgoing warehouse.

RFID tags are typically applied at the individual item level and are not reused.

RFID cannot be used for the following use cases:

  • Real-time tracking: The location is only known at the time of scanning at the location of a reader. This will typically occur up to a handful of times during the tag’s lifetime.
  • Condition monitoring: RFID tags do not usually have sensors embedded or any type of data processing because there is no battery to provide the energy for these functions. RFID Tags are thus not usually suited for condition monitoring applications.
  • Strict material flow cannot be enforced: For an accuratereading of an RFID tag, it must be in proximity of the reader, typically within 10ft/3m. Also, the line between the reader and tag must not be too obstructed by anything but air, such as a bulk of other products. If these conditions are not met, then the detection rate of RFID typically drops to 90% or below. To remain at or close to a 100% detection rate the goods need to pass carefully in front of the wall-mounted reader or scanner-type reader, or better, pass through a tunnel fitted with RFID readers over a conveyer belt. A pitfall we’ve heard from customers time and again is installing an RFID reader at a loading door, which fails every time because a significant number of RFID Tags are not detected.

RTLS Use Cases

The most well-known RTLS use cases are related to real-time tracking and inventory-keeping of raw materials, assembly parts, tools, and equipment (e.g., welding stations). As a result of the built-in sensors, the RTLS tag will alert you of temperature excursions, mechanical disturbances (shock, fall, tilt), and many other conditions.

Many RTLS systems take it one step further, by providing higher-level insights beyond asset identification and location tracking:

  • Utilization and mechanical disturbances (shock, tilt, vibration) to equipment: power tools, forklift trucks…
  • Vendor Managed Inventory & Consignment Stocking: count, box opening, box motion
  • Spare parts management: count, reordering points
  • Environmental monitoring: temperature, relative humidity, VOC, CO2…
  • On-site location of people indoors and outdoors
  • People counting within a zone or at a choke point, man-down detection, panic button, distress call button
  • Queueing and dwell time monitoring for the discovery of operational inefficiencies and attraction points

RTLS is not usually used for the following use cases:

  • Tracking low-value items at the item level. Instead, the container holding multiple of these items is usually tagged, especially if the container is reused.


RFID and RTLS solve very different problems, with only limited overlap. The tag cost is very different, with RFID tags being lower cost. The infrastructure cost (RFID readers and RTLS anchors) is also very different, with the RTLS infrastructure being lower cost.

Companies who are looking for a solution will benefit from understanding what exactly it is they wish to solve for, and then picking the right technology.

RedLore’s Take

RedLore specializes in RTLS, offering solutions both in the 16ft/5m position accuracy range and at the 1.5ft/0.5m high-accuracy range. Unique to RedLore’s solution is that even at the higher-accuracy the infrastructure Anchors are wire-free (no power nor data cabling required), saving between 65% and 85% of the upfront costs. Moreover, a RedLore hybrid deployment can contain both accuracies in a single network, for an optimal cost/performance ratio.

We’re always happy to talk to us about your needs!