Supply
Chain Digest didn’t make it to RFID
World this year, but investment researchers
Bear Stearns did, and the always reliable
Phil Alling and Andrew Matorin confirmed
what we and they have been saying for some
time, that the market for Electronic Product
Code-based RFID, driven primarily be the
retail supply chain, is moving slowly.
“RFID industry participants remain
frustrated about lower than expected tag
volume growth in the retail supply chain,
in particular for Wal-Mart related mandate
activity,” Bear Sterns wrote. “While
the retail giant continues adding suppliers
to its pallet and case level tracking rollout,
and more stores, the number of SKUs tagged
by most participating suppliers remains
low, according to industry observers.”
They note that for UHF-based, passive RFID
tags and systems in the supply chain, Wal-Mart
is really driving the train, and that RFID
technology suppliers believe that slow growth
will persist in this space until Wal-Mart
compels suppliers to step up their tagging
levels.
By Bear Stearns estimates, about 300 million
UHF tags were shipped last year, with estimates
for upwards of 500 million in 2007. While
this represents impressive year on year
growth, it is well below the billions of
tags that were forecast for 2007 in previous
years, and not enough to really drive financial
success for the many suppliers to this market. |