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Checkpoint Systems Deems OAT Acquisition Strategic

President Per Levin says the recently completed purchase of a leading RFID software company enables Checkpoint to help retailers "scale up their RFID operations."
By Mark Roberti
Jul 07, 2008Less than two years ago, Checkpoint Systems laid off several employees focused on the radio frequency identification market, prompting some publications to erroneously report that the company was pulling out of the RFID market to focus on its core electronic article surveillance (EAS) business (see Checkpoint Refocuses RFID Effort).

Some industry watchers, therefore, were surprised two weeks ago when Checkpoint announced it was snapping up OATSystems, a provider of RFID software (see Checkpoint Systems Acquires RFID Software Company OATSystems). But Per Levin, Checkpoint's worldwide president for shrink-management and merchandising solutions, says the acquisition—an all-cash transaction, recently closed—was a strategic move that positions the firm well for the future.

Per Levin
"We have had a new CEO since the start of the year, and we undertook a strategic review of our business," Levin says. "We looked further into the future and realized we needed to be a one-stop shop in the retail space for our customers. As retailers scale up their RFID operations, they are going to look for one company that can take responsibility for a national—or even global—rollout."

Levin believes Checkpoint Systems, with the addition of OATSystems, can do just that. Checkpoint is strong in RF hardware and services, he says, and deploys and maintains RF-based EAS systems for retailers worldwide. OATSystems provides software enabling companies to employ RFID data for promotions management, replenishment, electronic proof of delivery and other applications.

Checkpoint maintains a strong retail customer base, Levin says, and can now offer these customers the hardware, software and services they require to begin using RFID to achieve businesses benefits. "We want to broaden the scope of what we are doing," he states. "Shrink management is still our core business—but RFID gives us the potential to take it to the whole store, and to the supply chain, by providing visibility as products move through the supply chain."

At the same time, Checkpoint plans to allow OATSystems to continue operating as a separate business unit, and to maintain its office in Waltham, Mass. OAT had expanded its software offerings and market focus beyond retail and consumer packaged goods, and has been working with several major industrial manufacturers, including Airbus.

According to Levin, OAT will continue to serve the industrial manufacturing market. "We want [OATSystems] to execute on their business plan," he says. "To a significant degree, the success of that plan depends on the industrial side. We'll add value in retail, but we will not interfere with their current business plan."

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