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Avery Dennison's Chairman Bullish on RFID

In a recent earnings call, the company's Dean Scarborough said shipments of RFID transponders doubled in 2010.
Posted By Mark Roberti, 02.14.2011
There is a lot of radio frequency identification technology being deployed under the radar. In some cases, major retailers have rolled out solutions to stores without talking about it publicly, though rumors have been posted on the Web from time to time. Evidence of such activity arose during an earnings call with Avery Dennison on Feb 2, 2011.

Dean Scarborough, the company's chairman, president and CEO, had this to say about RFID during his prepared remarks: "We are starting to deliver on our value proposition to retailers and brand owners who responded very positively to the products and solutions we launched last year. RIS [Avery Dennison's Retail Information Services Group] has further to go, but it's starting to realize its potential for sales growth and margin expansion. And although small, an important part of the long-term RIS success story is RFID. Shipments in the year of RFID inlaying for apparel nearly doubled over last year, and we expect continued strong growth in 2011."

(For the complete transcript of this call, see Avery Dennison CEO Discusses Q4 2010 Results—Earnings Call Transcript.)

During a question-and-answer session with analysts, the Buckingham Research Group's John Roberts asked, "The 100 percent growth that you had in RFID Q4 over Q4—was that broad-based, and/or did it include a major ramp by any U.S. retailer?" Scarborough responded, "It's certainly a big part of the growth in apparel RFID tags. We also had growth in other segments where we sell RFID inlays. So from that perspective, it was pretty broad-based. And we did have a couple of customers in the U.S. ramp up their RFID programs."

Other transponder manufacturers also report robust sales, so there is clearly a lot of activity, some of which is not yet public information. That means some people sitting on the sidelines because they don't read about RFID deployments are falling behind without realizing it.

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.

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