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UPM Keeps Its Eye on RFID
Now part of UPM's Raflatac label-stock division, the company formerly known as Rafsec says it retains its commitment to meet the global demand for low-cost inlays and tags.
By Jonathan Collins
Jan. 30, 2006—Since its creation in 1997, UPM-Kymmene's RFID inlay and tag division has had to take a flexible approach to the markets it targeted, the products it designed and manufactured and even its corporate structure. UPM-Kymmene, a Finnish company focused on producing a range of paper for such things as magazines, newspapers, envelopes, bags and packaging, launched its RFID division, Rafsec, as a way to extend its business into smart-paper products. Since then, control of the division has been exchanged between UPM-Kymmene and its label stock division, UPM Raflatac.
Rafsec was initially a subsidiary of Raflatac, spun off into a standalone subsidiary in 2000 and then turned into a new UPM division alongside Raflatac in early 2005. Now that it has been taken over by Raflatac, the Rafsec name will remain only in RFID products. Nonetheless, the RFID division says it will continue to operate unchanged within Raflatac and compete globally in an emerging mass RFID market, where its flexibility, combined with an ability to produce inlays and tags efficiently, will be essential to its success.
"Nothing changes with the way we run the business," says Christer Härkönen, senior vice president of Raflatac's new RFID division. "This is purely a rebranding exercise." That means Raflatac's new RFID division will continue to aim to be a leading, low-cost global producer of RFID inlays and tags. "Cost is a key factor in the inlay market," says Härkönen. "It is not the only factor—products have to be the right quality—but getting the cost level right is where it begins."
"UPM is a €10 billion company, and RFID is seen as an important growth area and a strategic part of UPM," says Härkönen. This view is bolstered by the fact that initial considerations to develop Rafsec for sale have been scrapped in favor of long-term strategic investment from UPM, he says.
"There is a very strong commitment from UPM top management to grow the label stock business, which means that Raflatac is seen as a growth engine for the corporation, and there are very heavy expectations put on us," says Samuli Strömberg, vice president of marketing for Raflatac's RFID division. That gives Raflatac access to significant resources as it grows its RFID business.
The company's RFID division will continue to produce inlays and tags for both HF and UHF applications developed and sold by Rafsec in the past. HF tags are used in a range of applications, including library-book management, access control and mass-transportation ticketing; UHF applications, meanwhile, include supply chain management, baggage tracking and garment tagging. Before customers can use these inlays, however, they must first be converted into labels, either non-printable or printable. At its Finnish RFID plant, Raflatac produces both inlays to be converted into RFID labels by third parties, and finished tags made with its own label stock. According to the company, a majority of its U.S. sales are RFID inlays.
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Jan. 30, 2006—Since its creation in 1997, UPM-Kymmene's RFID inlay and tag division has had to take a flexible approach to the markets it targeted, the products it designed and manufactured and even its corporate structure. UPM-Kymmene, a Finnish company focused on producing a range of paper for such things as magazines, newspapers, envelopes, bags and packaging, launched its RFID division, Rafsec, as a way to extend its business into smart-paper products. Since then, control of the division has been exchanged between UPM-Kymmene and its label stock division, UPM Raflatac.
Rafsec was initially a subsidiary of Raflatac, spun off into a standalone subsidiary in 2000 and then turned into a new UPM division alongside Raflatac in early 2005. Now that it has been taken over by Raflatac, the Rafsec name will remain only in RFID products. Nonetheless, the RFID division says it will continue to operate unchanged within Raflatac and compete globally in an emerging mass RFID market, where its flexibility, combined with an ability to produce inlays and tags efficiently, will be essential to its success.
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"Nothing changes with the way we run the business," says Christer Härkönen, senior vice president of Raflatac's new RFID division. "This is purely a rebranding exercise." That means Raflatac's new RFID division will continue to aim to be a leading, low-cost global producer of RFID inlays and tags. "Cost is a key factor in the inlay market," says Härkönen. "It is not the only factor—products have to be the right quality—but getting the cost level right is where it begins."
"UPM is a €10 billion company, and RFID is seen as an important growth area and a strategic part of UPM," says Härkönen. This view is bolstered by the fact that initial considerations to develop Rafsec for sale have been scrapped in favor of long-term strategic investment from UPM, he says.
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| Raflatac's RFID division will continue to produce inlays and tags for both HF and UHF applications. |
The company's RFID division will continue to produce inlays and tags for both HF and UHF applications developed and sold by Rafsec in the past. HF tags are used in a range of applications, including library-book management, access control and mass-transportation ticketing; UHF applications, meanwhile, include supply chain management, baggage tracking and garment tagging. Before customers can use these inlays, however, they must first be converted into labels, either non-printable or printable. At its Finnish RFID plant, Raflatac produces both inlays to be converted into RFID labels by third parties, and finished tags made with its own label stock. According to the company, a majority of its U.S. sales are RFID inlays.
