The Recent Surge in RFID Interest Explained
RFID labeling has been quite the buzz for some time now. However, this year we’ve seen a massive influx in interest. What is the driving force behind this recent surge? Is this a quickly fading trend or is RFID here to stay?
Walmart Expands Its RFID Initiative
Walmart has had an RFID initiative in place for several years already. The initiative specified that primarily apparel, shoes, and handbags required RFID labels. Suppliers of these product categories to Walmart were required to deliver their goods with RFID labels attached. Over the last year or so, Walmart phased in other items including tires to their list of mandated items. These items require what is called item-level tagging and Walmart uses this for in-store inventory counts. So why wasn’t there a surge in RFID interest back when Walmart kicked off this mandate several years ago?
One main reason to explain the lack of RFID activity in North America was that the majority of the items covered under the original Walmart initiative are manufactured in Asia and in extremely large quantities. As a result, the RFID labels have been getting manufactured, printed, and encoded by Service Bureaus in Asia. They’re printed on large, million-dollar machines designed specifically for high volumes. For labels being manufactured in such high volumes, it is more efficient to print and encode on large inline machines. This is not the regular function of typical RFID and barcode label printers.
Walmart Continues to Expand Its RFID Initiative
In January 2022, Walmart greatly expanded its original initiative to include many additional product categories including home goods, toys, automotive parts and car batteries, electronics, and sporting goods. Then in August 2022, Walmart suppliers in these categories were required to deliver their items to Walmart with RFID labels. This was a game-changer for many RFID label printers as many of the new products are manufactured in lower volumes and in North America. Now RFID printers are a better option to help these types of Walmart suppliers comply.
Even though some of this new label business still runs through Service Bureaus, these Service Bureaus tend to be in North America and are generally geared towards serving local customers needing lower quantities of labels. We’re happy to supply these Service Bureaus in North America with our RFID label printers as this is the ideal production level for our products.
The Future of RFID Labels
Moving forward, we expect Walmart to continue to expand its RFID activity to even more product categories. Other retailers, large and small, are taking note of what Walmart is doing. These retailers will either expand their own RFID mandates (all currently limited in scope) or begin their own RFID labeling journey. With this rise, many other industries and applications will jump onto the RFID bandwagon.
All indicators point towards the increased use of RFID labels. Is your enterprise prepared? We have a wide variety of high-quality RFID label printing solutions available, as well as an RFID Printer and Label Validation Lab to test your RFID inlay compatibility with our printers.
Explore our RFID printing solutions here or contact your local sales representative to get started today.
