The Market Momentum in RFID, Discussed by IDTechEx
Almost two years after the COVID-19 outbreak began, the world is still in the tunnel. Despite the negative impact the pandemic has caused, there are some positive sides. For example, it accelerates digitalization – businesses are pushed to adopt technologies quicker to improve production as well as management efficiency.
RFID, a wireless technology that is used in a variety of businesses, from personnel identification, contactless card transactions, to tracking goods from retail apparel to manufacturing parts, etc., proves itself to be a resilient industry during COVID-19. According to the IDTechEx market research report “RFID Forecasts, Players and Opportunities 2022-2032”, COVID-19 has impacted the whole RFID business in 2020 – especially those that require physical on-site work. However, the market rebounds very well since 2021.
For UHF RFID business in retail apparel and footwear tagging – the largest UHF RFID market by tag volume as well as market value, the market rebounded since the second half of 2020 and it continues to grow strongly since. Several leading UHF RFID tag suppliers told IDTechEx that they expect this trend to continue for the foreseeable future, as more businesses will be in need to improve their inventory accuracy and business processes. UHF RFID in the retail apparel and footwear tagging business proves itself to be very successful, leading players are looking into bringing this success to other business sectors. Retail beyond apparel and footwear, food (ex: quick-service restaurant business), and supply chain & logistics are the three industries named most frequently by the companies IDTechEx interviewed. IDTechEx expects to see the retail sector in the UHF market continue to grow and dominate, with the retail apparel and footwear sector being the most dominant growth driver. Other industries, such as supply chain and logistics, are expected to expand in the coming years.
UHF Tag Volume and Market Value by application in 2021. Source: IDTechEx – “RFID Forecasts, Players and Opportunities 2022-2032”
For HF/NFC business, contactless payment is still the dominant sector and will continue to be so in the mid-long term. In the long run, the largest market in the HF/NFC sector identified by IDTechEx is the NFC applications beyond payments using flexible ICs. Currently, even though the HF/NFC beyond the payments sector is expanding, most applications in this sector are still relatively low volume deployments across numerous projects, such as Bluetooth pairing, gaming, information posters, and so on. Smart packaging is thought to be the application with the highest volume opportunity in this sector. However, the high cost of rigid ICs and lack of unique business cases are the two bottlenecks that hinder the strong growth. New technologies, such as flexible integrated circuits may help to drive the price down in the longer term. IDTechEx continues to monitor the R&D development as well as the scaling opportunities of the company (PragmatIC) that is developing this technology (PragmatIC full detailed company profile is included in IDTechEx’s RFID market research report).
HF Tag Volume and Market Value by application in 2021. Source: IDTechEx – “RFID Forecasts, Players and Opportunities 2022-2032”
Despite the RFID industry is returning to growth since 2021, IDTechEx forecasts that the worldwide chip shortage challenge will persist into 2022 and possibly 2023. Initially, Initially, the chip shortage crisis had little effect on the RFID industry. Many companies had stockpiled in anticipation of this crisis, which has aided larger RFID companies in meeting consumer demands. However, as of Q4 2021, what the companies have experienced in some cases is that supply can fall short, and they have had to adjust their pricing to reflect this.
IDTechEx has studied the RFID market for almost 20 years. Our latest version of the RFID market research report, “RFID Forecasts, Players and Opportunities 2022-2032”, provides a comprehensive overview covering passive RFID (for UHF, HF, and LF frequencies), battery-assisted passive, active RFID, and chipless RFID technologies, players, and markets. This report presents an unbiased analysis of primary data gathered through our interview with key players throughout the value chain (many of whom supply data to us under non-disclosure agreements that allow us to aggregate the data into a total) as well as secondary data from all available sources, and it builds on our expertise in the RFID industry. This report gives extensive forecasts and depth that no other source can match.
