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Tags segment is projected to record a 15 per cent CAGR and reach $33.1 billion

Tags segment is projected to record a 15 per cent CAGR and reach $33.1 billion



Global RFID technology market to reach $57.2bn by 2026

Demand for RFID technology, including tags, readers and software, is set to be driven by expanding applications of the technology in various industries

01 October 2021

Amid the Covid-19 crisis, the global market for Radio Frequency Identification (RFID) technology estimated at $27.1 billion in the year 2020, is projected to reach a revised size of $57.2 billion by 2026, growing at a CAGR of 13.3 per cent over the analysis period, a new market study published by Global Industry Analysts (GIA) said.

RFID is an advanced technology that involves the use of compact radio tags, which are capable of establishing communication with a networked device referred to as a reader. Radio tags are equipped with a transponder and a digital memory chip, and usually vary in terms of price, size and functionality.

Presenting fresh perspectives on the opportunities and challenges in a significantly transformed post Covid-19 marketplace, the study titled “Radio Frequency Identification Technology – Global Market Trajectory & Analytics” noted that demand for RFID technology, including tags, readers and software, is set to be driven by expanding applications of the technology in various industries.

Retail has emerged as one of the major end-use sectors over the years, with applications in merchandise and apparel leading demand with apparel and specialty merchandise being tagged with RFID tags. Retail applications will continue to dominate the global RFID tag market with major retailers announcing large-scale RFID tag projects for their merchandise, it said.

Tags, one of the segments analysed in the report, is projected to record a 15 per cent CAGR and reach $33.1 billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the readers segment is readjusted to a revised 11.3 per cent CAGR for the next seven-year period.

 

US, China makrets gallop

According to the study, the Radio Frequency Identification (RFID) technology market in the US is estimated at $8.1 billion in the year 2021. China, the world`s second largest economy, is forecast to reach a projected market size of $13.9 billion by the year 2026 trailing a CAGR of 16.8 per cent over the analysis period.

Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 10.1 per cent and 12.2 per cent respectively over the 2020-2027 period. Within Europe, Germany is forecast to grow at approximately 11.8 per cent CAGR.

Future growth in the market will be guided by the sheer magnitude of potential applications of RFID, such as, in baggage handling, contactless ticketing, asset management, contactless payments, electronic identification documents, product tracking in the retail industry, and in real time location identification systems, among others.

Amidst the ongoing financial uncertainty, there will be increased focus on technologies that help improve operational efficiency, reduce costs, and provide competitive differentiation. This readjustment of investment priorities and renewed focus on long-term cost savings and benefits will bring out RFID technology as the greatest beneficiary, especially in the enterprise consumer segment.

 

RFID software segment

RFID software solution is the key enabler of RFID systems allowing tags and readers to be deployed in a range of applications.

The software is designed to enable the system store and manage RFID tag data and integrate the same with other systems. RFID software can be used to customise RFID systems for application specific needs and add new functionalities to the systems as per the client needs and business practices.

In the global RFID software segment, USA, Canada, Japan, China and Europe will drive the 13.6 per cent CAGR estimated for this segment. These regional markets accounting for a combined market size of $3.1 billion in the year 2020 will reach a projected size of $7.5 billion by the close of the analysis period.  




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