RFID Needs to Make Its Case Beyond the Retail Apparel
By: ChainLink Research February 19, 2014
There is no argument today about the impact that retail/apparel and footwear have had on the passive UHF market. Estimates vary on apparel's share, but it hovers around 70 percent to 80 percent of the total UHF market. And that includes only about 2 percent of the apparel items sold. In our recent research of RFID use among retailers, the retailers indicated an interest in expanding their use of RFID in apparel. And the tag industry that supports retailers is forecasting numbers between 23 percent to 35 percent growth in apparel use, as well. More retailers will be tagging more items in the next few years.
More, however, does not mean all. Leading retailers who have a lot of expertise in RFID may be looking to tag more items in the store, but most retailers are only focused on certain value propositions and use cases such as high margin, high mix (blue jeans, men's shirts) and hard to keep in stock/NOOS (never-out-of-stock) items.
Forecasted growth of UHF RFID, overall, ranges from 10 percent to 35 percent. However, depending on retail apparel alone won't get us to a sustained profitable market for the chip and other product providers. We also need other categories to attain the same mass market characteristics as apparel in order to really see a market of size.