An IoT Story - Tag-n-Trac

There are some stories that are just picture-perfect examples of what IoT is meant to be and does not require too much of head scratching or business strategy thinking to understand how it is a viable and desirable product. This is one such story. This is also an excellent example of how you can build a viable business by building a better mousetrap.

I came across Tag-n-Trac in February 2022 and have been fortunate to talk to the CEO and Founder of the San Diego based company Venu Gutlapalli. Here are some interesting notes from my dialog with him. Read it till the end, as this seemingly obvious innovation has a genuinely unique and novel twist to how it is being applied (literally).

What is the problem that is being attempted to be solved?

Much of the modern world and lifestyle today is enabled by global trade and the underlying engine of such a trade is shipping and logistics. There is an incredible amount of goods that are shipped daily. About 52 million metric tons of goods are shipped by air annually and about 11 billion metric tons of goods are shipped by water. And as you can imagine every one of these item level goods are packaged into boxes, put into pallets that are grouped into containers and then shipped to their destinations where they get handled again down to the point where an individual item is delivered.

From a logistics and supply chain standpoint, the invention of the barcode and RFID systems were immensely helpful making it possible for handlers of packaging and shipment to go through packages quickly and efficiently.

But one challenge has yet remained. The only way one could track a package has been by physically accessing it and scanning the bar code label. For example, when you get shipping updates from FedEx and UPS and USPS or any other shipping solution provider, those updates are generated when the package has physically been scanned by making it go through a door, or a warehouse or pallet by a warehouse operator or by a shipping handler.

If the box lands in a spot for some reason where it is not accessible by a logistics operator, then there is no way to identify where it is unless someone locates it and scans it. Outside of lost containers in the sea, there is a large amount of cargo that is lost or damaged in transit or sometimes just gets stuck in the wrong place due to incorrect handling with no recourse and a difficult process to identify.

How is this problem being currently addressed?

IoT is a perfect solution for these problems and yes, this problem has been solved at a certain level in the shipping and logistics industry. You can today, have a bulky tracking device be setup for most containers and be able to track containers moving across your system. If there is significant value in our cargo then you can likely put a tracking device on each of your packaging and track it.

The key drawback till now has been the fact that the process steps around handling IoT devices tend to be completely separate from the process steps of handling cargo which makes the adoption and implementation of the solution more difficult and error prone when you try to do it at a large scale. For example, operators need to be trained on how to handle a tracking device and how to associate a tracking device to the packages that it would be holding.

This seemingly simple process can be a significant source of efficiency loss in the operations where every second counts. What you really need is a solution for tracking that is truly seamless to the current process and at the same time cost effective.

So how does Tag-n-Trac team think they have solved the problem?

Venu shared that he had heard many of his customers talk about their problems with really no solution which became the basis for the creation of Tag-n-Trac. The uniqueness and novelty in the solution from the Tag-n-Trac is in the packaging. What they have been able to accomplish is to create an IoT solution that can be put within a simple flexible, printable, stickable label.

That means, the entire electronics, components, battery, antenna etc, are all nicely packaged inside a label form factor as a roll that fits into the standard industrial ?printers that are currently used by almost everyone to print their shipping labels.

This is absolutely genius from logistics perspective and an incredibly efficient solution at that. It allows for those handling the packages to process them with no change in their processes. Shipping handlers can apply the packaging label exactly the way they do it today at the individual package level, then at the pallet level and then load them up into containers. With each label having its own uniquely trackable IoT device embedded within it, now logistics teams can track the package from the point when the label is applied to when that label is discarded.

Customers and logistics operators also benefit from knowing and tracking the location of the device irrespective of where the package is in its transit without having to rely on the package crossing a checkpoint and an operator scanning the barcode physically. This in-fact removes millions of manual action of scanning the barcode from the operational flow improving efficiency.

It is obvious that the team that managed to put an entire IoT circuitry within a label would have figured out adding a couple of cheap sensors to it as well. Which is what they did to target pharmaceutical industry and their needs and the cold chain food tracking industry.

Now pharma companies can track their boxes of vaccines or insulin throughout their journey to ensure that they are always being handled at the expected temperatures and products that have been damaged due to improper handling are clearly and individually identified and removed from the system.

This in my mind is a game changer.

So how is does this label look and feel?

The novelty as I said is in the packaging. These are literally labels but they are a little thicker than normal. The standard shipping labels used on packaging are about 0.2 mm thick. But printers are designed to take in label rolls that are up to 2.5mm thick. The goal for the Tag-n-Trac team is to achieve the thickness of less than 2.2mm which is where they are at on their thickest label.

As with any such solution, the biggest challenge is the battery. With the need for tracking, communication and a potential shipping duration (in the ocean) of up to 3 months, there is a need to have a decent sized battery on these labels and these batteries are the major contributor to the thickness of the label. The longer the duration of tracking needed, the thicker the battery gets. It can only be expected that with further innovation in battery technology, it will only improve and become more and more thinner.

Are there any adjacent opportunities for this?

For many product families, location tracking is not just the only problem. For example, perishable goods have to be tracked for what kind of conditions they have been in along with the duration of their storage in various locations. Pharmaceutical products require, sometimes by law, tracking of temperature to ensure that the products are not destroyed due to temperature exposure. There is an entire cold chain tracking industry that is trying to solve the problem of tracking the freshness of food from the farm to your plate.

Also, there are many opportunities of improving container load efficiency where many a times containers are shipped without being fully loaded which is an indirect loss. If logistics operators knew exactly where every package in their system is physically and how far from its destination (or container) then they could make decisions on holding certain containers for a delivery that maybe just 5 mins away or re-routing other deliveries so that container space is efficiently used up.

What technologies are employed in this solution?

Tag-n-Trac has 2 different technology solution offerings. One is based directly on the cellular, which means that the label incorporates the full cellular communication stack thereby sending data to the Tag-n-Trac team servers through the cellular network when they are in range of any of the towers

The other is based on Bluetooth, which is designed to be lower in cost and is to be used in solutions where individual packages would get the Bluetooth labels while the pallet that holds a bunch of these packages gets a cellular label. Or you could choose to use these Bluetooth label-based packaging with technology which is similar to how the “Tile” based tracking solution works which is crowd sourced.

Bluetooth labels are also helpful in getting tracked in warehouses where they can be easily identified without having to scan them physically.

Does this create a new electronic waste of batteries in labels?

Venu was ready with the answer when I asked him this. The chosen technology for batteries in this application is not lithium-ion but Zinc-Magnesium. So, there are no rare earth metals in use and the batteries are easy decomposable.

They are also in discussions with a company that provides recovery and recycling services at a cost that can enable them to retrieve these nice little IoT labels, recover the necessary electronics and redeploy them back into service. Since the product sold is not the label but the tracking ability of it, no one would be offended if the Tag-n-Trac team reused a label.

How expensive would these be?

The Tag-n-Trac team is still figuring these prices out and they do vary by application, but they are able to potentially provide tracking for over 12 weeks in high volume applications for less than $30 a shipment. That may be expensive at an individual package level at this point but is extremely cheap for tracking at the pallet level. The Tag-n-Trac teams’ goal is focus on the high value goods and pallets segment as the starting point as at this level the cost of the solution is a no brainer. As they grow and scale these solutions, they expect to bring down the cost and make the technology more efficient. The vision would be to one day be able to track your package through its entire journey for a reasonable price adder as a service.

What am I excited about for this technology in other spaces?

I do see this technology having a huge impact on those who want to do asset tracking and management through the life of the product. Not all products need tracking on an hourly basis like a product being shipped from the factory to the customer’s home. And not all tracking has a limited duration need of 3 months. If you could imagine a label that can be printed and tracked for say 5 years with updates coming in once per day from it, then I believe that such a label would replace the standard product labels on many machines and equipment and could revolutionize the asset management industry where assets likely move from time to time. Venu and I have spoken about this and he is excited about the possibilities but as a founder, his focus is currently in seeing this product succeed in the identified markets that it was targeted for.

NOTE: The company is a startup that came out of stealth mode in Q1 of 2022 with the lead investor as Dell Ventures.?