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Focus: RFID and Automated Identification and Data Collection (AIDC)

Feature Article from Our RFID and AIDC Subject Area - See All

 

From SCDigest's OnTarget e-Magazine

- July 29, 2014 -

 

RFID and AIDC News: Study Says RFID Market to Soar, Led by Retail Apparel

 

Item-Level Apparel Tagging will Lead Retail to Largest Single Segment by 2014; What about Consumer Goods and General Manufacturing?

 

SCDigest Editorial Staff


Retail applications for RFID are set to lead an explosion in the overall RFID market size, with general consumer goods adoption also rising sharply, as growth in general manufacturing will remain modest.

 

SCDigest Says:

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As the charts show, IDTechEx also says RFID related spend by consumer goods companies of all sorts is negligible currently, but will grow to 5% of the market by 2024.

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That according to a new report from the analysts at IDTechEx, who expect the total global RFID market, including all tags (passive and active), readers, software and services, to be about $9.2 bilion in 2014, up sharply from about $7 billion in 2012.

But IDTechEx expects the market to accelerate even further, nearly doubling by 2018 to over $18 billion, and then rising to some $30.2 billion in 2024.


If that were to occur that would be a cumulative average growth rate (CAGR) of about 12.6% from 2014 on, very solid indeed.


Whether we'll see the RFID market doubling by 2018, and then coming close to doubling again in five more years obviously will remain to be seen, but perhaps more interesting than the total is what sectors will be driving the growth.


As can be seen in charts below from IDTechEx, this year the global retail RFID market is estimated at $400 million, or about 5% of the overall total. The current market is dominate by applications in the transport sector (mostly for RFID-tagged tickets) and "financial" applications such as RFID enabled credit cards and key fobs.


But by 2014, that picture will have changed dramatically with retail RFID spending exploding, rising to $8.1 billion by itself, to 27% of the global total, and will become the largest single segment by then.

 

 

Source: IDTechEx

 

 

 

 

Source: IDTechEx

 


The driver of that growth of course will be item-level apparel tagging, such as programs already being pursued by Macy's, Walmart, American Apparel, Zara's and more. IDTechEx says that there are about 40 billion apparel items that could be tagged each year, and that in 2014 only about 3 billion of them will be, obviously leaving a lot of market for additonal growth.

(RFID and AIDC Story Continued Below)

 

 
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As the charts show, IDTechEx also says RFID related spend by consumer goods companies of all sorts is negligible currently, but will grow to 5% of the market by 2024. Manufacturing's share will rise from about 2% to 3% over the same period.

Of course, big predictions for RFID adoption in the consumer goods to retail value chain have proven far too rosy in the past, but SCDigest believes that IDTechEx is probably largely correct given current positive market dynamics in the apparel retail sector.


 

Do you see the RFID market taking off, especially in retail? Why or why not? Let us know your thoughts at the Feedback section below.

 

Recent Feedback

Seeonic was founded on the principal of actionable intelligence using RFID collected inventory at the point-of-use (retail shelf, medical devie bag, storage rack, etc.).  We have witnessed the evolution of RFID technology to item-level tags read at the point-of-use, fixed readers, and a dramatic reduction in the cost of readers and tags.  We have seen a major uptake in the number of applications for RFID and the recognition of the value that is created.  


The interest in the Internet of Things and Machine-to-Machine applications has also stimulated consideration of the use of RFID as a wireless sensor in such networks.  The IDTechEx forecast may be a bit high, but it is definitely telling the right story in terms of the growth of RFID.

In the retail industry, omnichannel opportunities have risen dramatically due to store-based retailers desire to provide better service and fulfillment than pure online retailers.  The only technology that can be used to track in-store inventory used to satisfy omnichannel demand is RFID.  Since the retailer's omnichannel requirements are growing, the demand for RFID technology will grow also.

 


Harley Feldman
Co-Founder and CMO
Seeonic, Inc.
Aug, 14 2014
 
 
   
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