(Oct. 14) With retail giants like Wal-Mart and Target cracking the whip, radio frequency identification technology would seem to be a sure thing.

Except that it may not be, according to some experts. At least not as quickly as some companies would like it to be.

Most in the produce industry are aware of the challenges that face them as they implement RFID programs of their own — readability, logistics and, most of all, the cost of the chips themselves.

But a new report from Stamford, Conn.-based research firm Gartner Inc. warns that, in the short term, RFID cannot live up to the promises that have been made about the emerging technology.

In fact, the report estimates that at least 50% of RFID projects now under way will fail by 2007.

Jeff Woods, research analyst for Gartner and author of the report, said RFID will work at some point, but it won’t happen overnight, and businesses should be prepared for that.

“It took 20 years for businesses to begin effectively using bar code data in operational management,” Woods wrote. “It won’t take as long for RFID to become mainstream, but it will take a long time.”

Gary Fleming, vice president of industry technology and standards for the Produce Marketing Association, Newark, Del., said the produce industry needs to focus on the short-term benefits for now.

“For the short term, RFID is primarily used from a transportation and storage and handling aspect. That’s where the big gains are going to be,” he said.

While a lot of companies are talking about different applications for the technology — including enhanced traceability and security — Fleming said the industry isn’t ready to go that far just yet.

“That’s very premature,” he said, “because that’s going to be a significant increase in human resources and capital in general to address those issues.”

Bruce Peterson, senior vice president and general merchandise manager of the perishable foods division of Wal-Mart Stores Inc., Bentonville, Ark., said that RFID technology will deliver on its promises, though it may take time.

“That’s the promise of RFID, that you could have a supply chain that is both seamless and instantaneous,” he said. “As the various industries work toward that, the benefits continue to manifest themselves every day, even in the short term.”

Peterson said the industry in general seems to be aware that some facets of RFID technology won’t happen overnight.

“There is nobody that I know that says that RFID is the cure-all for every supply chain woe in the next 30 days,” he said. “Everybody recognizes that RFID is a journey. The difference in where RFID is today with respect to 18 months ago, is that a number of large organizations are planting flags on some deadlines to get this thing moving.”

Fleming said one of the biggest hurdles facing the produce industry is that there just aren’t enough companies testing.

“The progress, though it’s going fairly quick, it’s not quick enough,” he said. “There are still a lot of things to be tested.”

Among the issues the produce industry still has to deal with are reading the tags through water — which has a tendency to block readers — and reading multiple cases on a pallet.