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  - August 25, 2010 -  

RFID News: Mobile RFID Readers Now also in Short Supply?

  
 

What a 20,000 Unit WalMart Order will Do to You; 300% RFID Market Growth in 2011?

  
 

 

SCDigest Editorial Staff

SCDigest Says:
Suddenly, breaking out RFID revenues may become fashionable again for publicly-traded companies.

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Last week, we reported that RFID EPC Gen 2 inlays were in a supply crunch, fueled by current and expected demand from WalMart’s new item-level apparel tagging program. (See Is WalMart Item-Level Tagging Program Leading to an EPC Inlay Capacity Crunch?)

 

Now, the RFID market analysts at investment firm Robert W. Baird & Co. say that mobile RFID readers are also in increasingly short supply.

 

Here, it is a combination of factors, which includes supply constraints that have lasted for months in basic electrical components that have cause delivery problems in a wide number of high tech gear, including mobile devices.

 

Second, overall RFID market growth is strong right now, and Baird says that has led to supply constraints especially for the Motorola MC-9000 and MC-3000 family mobile terminal units – a situation exacerbated by the 20,000 unit order WalMart recently placed for Motorola readers. Those units will allow, for example, store operators to do almost instant cycle counts of RFID-tagged blue jeans.

 

In addition, European logistics company Container Centralen, which transports horticultural products and has begun tagging re-usable dollies and containers, is asking its 23,000 customers to all purchase mobile readers – some of which will likely procure multiple units for themselves.

 

Baird says right now, mobile RFID readers are outselling fixed readers by a ratio of 3-4 to one.

 

A quick check at ScanSource, a distributor that sells exclusively to other resellers and VARs, showed about half of the models of Motorola 9090-G mobile RFID terminals were in-stock, and the other half showing as “call for availability.”

 

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Those supply pressures are likely to magnify into next year, as Baird expects growth of an amazing 300% in the broad category of RFID-based “asset management” – which includes inventory visibility – for 2011, a much higher rate than most recent analyst estimates. It notes that Avery Dennison recently told Wall Street analysts that it expects RFID revenue in its retail business unit to grow from $50 million in 2010 to $150 million in 2011, an increase of 200%.

Suddenly, breaking out RFID revenues may become fashionable again for publicly-traded companies, a practice that almost completely disappeared in the wake of the slow take-off of RFID and WalMart’s first program earlier in the decade.

 

If all this holds true, users can likely expect some challenges acquiring mobile readers, and that the discounting often seen in this type of hardware may disappear with customers just happy to acquire a unit when they need it.

 

Do you expect the RFID market to see triple digit growth in 2011? Are you seeing any supply shortages in mobile RFID readers? Let us know your thoughts at the Feedback button below.

  
     
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