by Brianna Crandall — September 8, 2014—The business model and structure of the manufacturing industry has grown well beyond the scope of a single enterprise and location, making radio frequency identification (RFID) solutions indispensable to its functioning, according to a new report from global growth consulting firm Frost & Sullivan. With increasing adoption of lean manufacturing strategies prompting most industry players to focus on and outsource niche operations within global supply chains, RFID solutions will help sustain high levels of performance, concludes the report.
“Analysis of the Global RFID in Manufacturing Market” finds that the market earned revenues of $1.29 billion in 2013, and estimates this will nearly quadruple to $4.99 billion in 2020. The study covers passive, active and battery-assisted passive RFID. Over the forecast period, demand for active RFID is expected to increase to fulfill business needs more efficiently.
Use of RFID technologies enhances supply chain visibility and total control of inventory, operations and logistics across diverse manufacturing points, points out Frost & Sullilvan. As RFID solutions facilitate real-time tracking of assets in different locations, it increases productivity, enabling cost-effective allocation of resources. These benefits, along with reduced labor requirements, information accuracy, improved sales and customer service, boost RFID adoption among manufacturing participants looking to realize higher return on investment.
“Opportunities for RFID solution providers exist across all application segments within the manufacturing industry,” said Frost & Sullivan Measurement & Instrumentation Senior Research Analyst Nandini Bhattacharya. “Growth prospects in the automotive and aerospace manufacturing sectors are especially promising owing to supportive industry regulations.”
However, as long as the economic situation remains uncertain, customers — particularly small and medium enterprises — will be reluctant to invest in RFID solutions unless they see a direct correlation between implementation of these technologies and cost-saving advantages. Cost is, therefore, a discerning factor for consumers’ RFID purchasing decisions. Scalability of solutions and technology support will be important criteria influencing uptake.
“Partnerships and acquisitions are rampant and necessary for this market to continue to expand,” noted Bhattacharya. “Without such collaborations, the breadth of knowledge and expertise needed for success is typically too wide even for the largest of companies.”
“Analysis of the Global RFID in Manufacturing Market” is part of Frost & Sullivan’s Automatic Identification and Security Growth Partnership Service program. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
Complimentary access to more information on this research is available for brief free registration on the Frost & Sullivan Web site.
