- According to a new internal report, the RAIN Alliance found that 52.8 billion RAIN UHF RFID chips were shipped in 2024, up from 44.8 billion in 2023
- The growth, even after the correction year that followed supply chain problems, implies the continued health of the industry.
RAIN UHF RFID technology continues its growth trajectory based on a recent report by the RAIN Alliance that examined the estimated shipping numbers of the industry’s five largest chip providers. The companies reported they shipped 52.8 billion tag chips in 2024, up 17 percent from the year before, as all five contributing companies saw an increase in sales.
In a summer report with VDC Research, the RAIN Alliance predicted that growth this year would be about 20 percent. The slightly lower results may indicate the reality of the supply chain correction event in 2023, which was potentially inflated as companies tried to increase the deficits in the stocks.
Alliance officials pointed out that growth has been uneven because of supply chain challenges after the pandemic. This year’s figure was expected to be more conservative than the year before, when the alliance saw 30 percent growth. Companies have since refilled their depleted stocks and the fact that growth continues indicates a healthy business market, said Aileen Ryan, RAIN Alliance president and CEO.
“So this was a small correction, but it’s still a fantastic growth number,” Ryan said. “The scale of demand is notably marked by a 54 percent increase in RAIN tag chip shipments in just two years.”
Projection for Next Year
The RAIN Alliance annually reports on the shipped tag chip volumes among its highest volume members. Looking ahead at first quarter reports for this year and trends perceived, the RAIN Alliance anticipates another year of growth at 20 percent over the next year, which would bring the total number of RAIN RFID chips shipped to 64 billion.
Ryan pointed to broadening mandates from retailers bringing new suppliers to the technology including beauty products, home goods, electronics and fashion as new sectors are spurring more growth.
“I would expect that this year may increase more in the logistics sector—that’s an area that has been talked about it a lot and I think hasn’t yet fulfilled its potential,” for boosting efficiency with RFID tags on merchandise, she said.
Where the Growth Is
Growth in tag chip shipments continues to be driven by retailer mandates for a wider range of items to be tagged with RAIN technology. Mandates from companies like Walmart, which is selling most goods with RFID tags applied, lead to a wider variety of suppliers acquiring RFID tags for merchandise beyond garments and footwear.
There is also greater adoption for RFID tags to bring visibility to pharmaceuticals, healthcare products, as well as in use to boost efficiency in logistics sites and manufacturing. Beyond that, tire tracking with RFID is underway in the number of billions of products annually.
“This is exactly where we would have expected it to be, as an industry,” Ryan said. “I think at the beginning of last year when we saw the numbers people were saying we should be cautious for this year because inventory will have built up at the inlay companies. So I was really pleased with the number this year.”
Walmart Halo
Walmart has begun asking for RFID tags on products below the $1 dollar price tag. Other retailers such as Uniqlo in Asia, are requiring RFID tags on all merchandise and those tags are used for inventory management, authentication, loss prevention and self-checkout.
Growth of the technology “all hinges on the price point and acceptability of the price point and the return on investment related to the cost of buying and attaching the tag to a lower value item,” Ryan explained.
“We seem to be there now as an industry for the sort of commoditized tags, which is really good,” she also pointed to broadening mandates for sportswear, electronics, furniture, and beauty products.
Overall Value for Retailers, Customers
Whether the merchandise is 75 cents, or $500, stores that capture data with RFID, keep their out-of-stock events down. If a product is not on the shelf, a store’s associate can more easily use RFID to locate that missing item as well. If the tagged product is a high value appliance or a low cost consumable item, that means customer satisfaction is higher.
Specialty or custom RFID tags are currently being developed to meet EU digital product passport (DPP) mandate that requires specific goods be traceable from factory to recycling.
“That’s going to require a different type of more specialized tag for most applications,” Ryan said. “Because it needs to be embedded, it needs to stay in the product for its entire lifetime, otherwise it’s not really fulfilling the promise of digital product passport.” That can include sewn in tags in garments, tire tracing tags and other specialized products.
As the DPP planning moves forward, companies are planning for systems interoperability so that data from the tag can be accessed and amended as needed. “I see a new wave of innovation in the next couple of years but I’m definitely seeing a lot of momentum related to the digital product passport,” offered Ryan.
Five Suppliers Reporting
This year’s 5.2 billion tag volume comes from five companies that are the majority of suppliers for RFID tags. Semiconductor companies: Impinj, NXP, EM microelectronic, Shanghai Fudan Microeletronics Group and Shangua Quanray Electronics.
The RAIN Alliance has started serving as a liaison to Europe’s legislative body known as the CEN/CENELEC JTC24 committee to create a standard for DPP data framework. The resulting guidelines will aid companies in ensuring the data is universal and accessible.
Ryan added that integration of RAIN UHF RFID readers in mobile phones or related devices might accelerate the technology adoption. “We are committed to making RAIN-enabled devices a reality,” she said, to enable new use cases for consumers, to boost sustainability and aid with enterprise growth.