Radio-frequency identification (RFID) pilots used to ease the transition into item-level tagging within the apparel industry is expected to drive demand for this market. The expanding implementation of RFID provides complete automation of various processes involved along the supply chain. This results in better inventory visibility, greater supply chain management, improved sales, better customer service, and negates the impact of counterfeit products. In addition, mandates from large retailers to their suppliers to implement item-level tagging are also driving the growth.
New analysis from Frost & Sullivan (electronics.frost.com), RFID Market in Apparel Supply Chains, finds that the market earned revenues of $420.6 million in 2010 and estimates this to reach $1478.1 million in 2017, with a wide-spread implementation of RFID technology into the apparel industry globally.
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Availability of products in the correct size and color is a perennial issue for apparel suppliers. This is caused by the lack of information and communication along the whole apparel supply chain. As this has a direct bearing on customer service levels, apparel suppliers are opting for RFID technology in order to manage their business processes.
"The need for business process management is expected to drive demand for RFID within the apparel industry," said Frost & Sullivan Research Analyst Ram Ravi.
Customers in the apparel industry are generally conservative toward the adoption of new technologies. This can be attributed to several factors including the price, lack of knowledge, lack of business case and understanding about the technology. Although RFID in apparel has developed over some years, several customers are still unaware of the technology and its benefits.
"A key aspect behind retailers’ apprehension is the cost associated with the implementation of the technology, as they operate on low-profit margins," said Ravi. "Suppliers need to provide a wide array of products and solutions catering to the individual needs of their customer and also provide training and services such as technical consulting to educate their customers about the benefits of the technology."
RFID Market in Apparel Supply Chains is part of the Electronics Growth Partnership Services program, which also includes research in the following markets: apparel, passive RFID and active RFID. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.
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RFID Market in Apparel Supply Chains / N953-11