Compliance Remains King Among Consumer Goods Manufacturers

• Posted: Saturday, October 04, 2008
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• Author: pradhana
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• Filed under: Miscellaneous

Consumer goods manufacturers and retailers continue to adopt RFID largely for the sake of compliance with mandates from the likes of Wal-Mart, Sam’s Club, and METRO in Germany. However according to a survey recently conducted by ABI Research, topline results of which are available in a free white paper on the firm’s website, other benefits that RFID can deliver are growing in importance and will eventually overtake compliance as the leading market driver for RFID uptake in this vertical.

According to research director Michael Liard, “While compliance remains the primary motivator for RFID uptake in the consumer goods sector (in contrast to the overall RFID market) respondents to this ABI Research survey cited three other considerations that increasingly influence their decisions to trial and deploy the technology. They are: ease of scalability, business process improvement, and removal of human intervention.”

The breadth of possible retail RFID applications is growing, too. For example, consumer goods manufacturers and retailers also agree that RFID technology can contribute to more effective promotions by helping to determine when promotional products arrive, and if and when they were placed on the store floor. Another exciting area is item-level tagging of apparel, books, and more.

Liard adds, “Declining passive UHF tag and readers price points have positively influenced market adoption, but further reductions are necessary if RFID is to explode in supply chains. Favorable prices will become even more critical as consumer goods manufacturers focus on ROI and total cost of ownership, and when RFID ‘goes wider and larger’ within enterprises.”

A new ABI Research White Paper, “Consumer Goods Manufacturers Continue to Press Forward with RFID Adoption Plans,” is an industry-specific complement to the firm’s “Annual RFID End User Survey.” This paper contains findings from 37 consumer retail sector respondents and provides analysis of the survey’s results in the areas of RFID system usage and evaluation plans; RFID spending; primary adoption drivers; current and future supply chain management applications by tagging echelon (pallet, case, item); vendor selection criteria, and RFID system requirements. [ABI Research]

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