U.S. RFID TAGS MARKET ANALYSIS

U.S. RFID Tags Market Size and Trends

The U.S. RFID tags market is estimated to be valued USD 5.08 Bn in 2024 and is expected to reach USD 10.50 Bn by 2031, growing at a compound annual growth rate (CAGR) of 10.9% from 2024 to 2031. RFID tags are increasingly being used across various industries like retail, manufacturing, healthcare, transportation & logistics for benefits like inventory management and convenience.

The market is expected to witness significant growth during the forecast period. Increased adoption of RFID technology by retailers and use cases beyond inventory management are expected to drive the demand. Growing need for supply chain visibility and automation are some factors that are expected to support the high growth rate. Expanding applications of RFID in contactless payment and access control would also contribute to the market potential.

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One of the key drivers for the growth of the RFID tags market in the U.S. is the need for improved tracking and inventory management across various industries. With rising complexities in supply chain operations due to factors like Just-in-Time manufacturing, omni-channel distribution and shortening product life cycles, companies are finding it increasingly challenging to keep track of inventory levels in real-time and maintain visibility across the entire supply chain. This is where RFID technology can help overcome such issues and enable smarter inventory management.

RFID tags allow items to be tracked automatically as they move through warehouses, retail stores, and other facilities. These tags can be scanned simultaneously without needing a direct line of sight, thus allowing for rapid physical inventory counts. Moreover, the tags carry a unique identification number which can be linked to other relevant product details in backend databases. This allows companies to accurately determine inventory levels on shelves and in stockrooms, track movement of shipments in real-time, identify errors or losses more efficiently, and optimize replenishment decisions. Particularly for retailers with huge warehouses and distribution centers handling thousands of SKUs, RFID is proving invaluable in streamlining inventory workflows and bringing down operational costs associated with manual tracking systems.

Many consumer goods companies and retailers have already reported yield improvements and significant cost savings by implementing RFID for better visibility into inventory levels across their supply networks. As the need to precisely match supply with demand increases, particularly in the midst of ongoing shifts in consumer buying behavior, more organizations are recognizing RFID as a major enabler for proactive inventory optimization. This growing importance of enhanced visibility and smarter inventory management is supporting the continued rise of RFID adoption rates across various industry verticals in the U.S.

Market Concentration and Competitive Landscape

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Another key aspect driving the demand for RFID tags in the U.S. is the utilization of RFID technology to automate manual processes and add more value to existing operations. With rising labor costs and a growing shortage of workers, companies are increasingly seeking ways to leverage Internet of Things (IoT)-enabled solutions for introducing higher automation levels across their facilities and workflows. This is where RFID is playing a pivotal role by replacing labor-intensive manual tasks with automated identification and data capture capabilities.

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High infrastructure costs associated with implementing RFID systems pose a major challenge for adoption across various industries. Furthermore, data security and privacy concerns continue to be a barrier, as many customers worry about unauthorized tracking. Slow adoption rates, especially in consumer goods markets, also limit growth potential for RFID tags. Technological limitations of current RFID tags restrict wide-scale deployment.

Market Opportunities: Adoption of RFID in new application areas like healthcare and retail

Mandates from the U.S. Department of Defense and other government agencies to use RFID tags create a steady demand stream. The integration of RFID with IoT further enhances capabilities and use cases. As industries realize ROI and efficiencies from RFID deployments, adoption rates are likely to rise in sectors like retail, manufacturing, and logistics. Ongoing technology advancements are expanding RFID applications while lowering.

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Insights, By Type: Convenience and Cost-effectiveness Drive the Demand for Passive RFID Tags

In terms of type, passive RFID contributes the highest share of the U.S. RFID tags market owing 67.5% in 2024 to their convenience and affordability. Passive RFID tags do not require an internal power source as they derive the energy needed to power their microchip's circuitry from the radio frequency emitted by the reader. This eliminates the need for maintaining and replacing batteries, making passive tags very cost-effective to manufacture and use over the lifetime of the application. Their simplicity also means that passive tags are often smaller and lighter than active tags, allowing them to be incorporated easily into smaller items. Several industry verticals where tracking large volumes of tags is necessary, such as retail and logistics, heavily rely on passive RFID technology due to its affordability. The lack of an internal power source does limit the range and capabilities of passive tags when compared to active tags, but for many basic identification and supply chain applications, passive RFID tags fulfill requirements very well at a much lower cost. This widespread suitability and affordability has led the passive tag segment to account for the highest share in the U.S. RFID tags market.

Insights, By Product Type: Commercial Demand from Inventory Management Drives Tag Usage

In terms of product type, commercial tags contributes the highest share owing 31.4% in 2024 of the U.S. RFID tags market due to high demand from the inventory management applications of various industries. Commercial organizations across sectors like retail, manufacturing and logistics extensively use RFID tags to manage inventory, optimize operations and improve supply chain visibility. RFID allows tracking individual product items through each stage, from receipt and put-away to picking, packing and shipping. This enables efficient warehouse operations through automated inventory checks, selective batch retrieval and streamlined replenishment based on real-time stock levels. The technology also eliminates manual errors, reduces shrinkage and consolidates data for actionable analytics. Many leading retailers and third-party logistics providers have implemented RFID-driven warehouse management solutions owing to the significant return on investment through boosted productivity and accuracy. This sustained commercial adoption is the primary driver sustaining tag usage for inventory management and maximizing the share of commercial tags.

In terms of end-use industry, the retail sector contributes the highest share owing 27.5% in 2024 of the U.S. RFID tags market owing to benefits in enhanced customer experience as well as in-store asset management. At the customer end, RFID is enabling personalized and rapid checkout through initiatives like Amazon's 'Just Walk Out' technology. RFID tags embedded in apparel and merchandise ensure contactless and seamless transactions. This elevates the shopping experience and engagement. Simultaneously, RFID use in stores allows real-time monitoring of merchandise movement and automatic replenishments. Retailers can track high-value assets like electronics and optimize store associate tasks through location-based alerts. RFID is also enabling new retailing formats like mobile stores and curbside/locker pickups through digital item linkage. The dual advantage of improved operations as well as shopping services is driving continued RFID exploration among major retailers. This sustained retail innovation and implementation environment sustains the industry's dominance as the highest revenue generator for RFID tags.

Market Report Scope

U.S. RFID Tags Industry News

• In February 2023, the security tech group put out a report about smart card projects by the U.S. government and institutions. The report said the U.S. government started using smart cards for employee and contractor IDs. They are also using them for citizens, transportation staff, and first responders in new ID programs. This move by the U.S. government is making electronic ID cards and RFID tags in smart cards more popular.
• In March 2022, Avery Dennison Corporation, the provider of branding and information labeling solutions, announced the acquisition of linerless label technology created by Catchpoint Ltd. This technology is used to make sure that labels should not stick to one another for this it as the feature of the silicon release coating. This deal includes ownership on all Catchpoint Ltd.'s patents, brand, and trade secrets.
• In June 2021, Impinj, Inc., a provider of RAIN RFID reader chips, introduced the E910 RAIN RFID reader chip for next generation that enables Internet of Things (IoT) device markers to increase the demand for item connectivity in retail, logistics, and supply chain, consumer electronics, etc. E910 RAIN RFID includes E710, E510, and E310

*Definition: The U.S. RFID tags market consists of companies that manufacture and sell radio frequency identification (RFID) tags and labels for use across various industries within the U.S. RFID tags can be attached to or incorporated into products, animals, and packages to enable identification and tracking using store to monitor to track inventory levels, streamline supply chain management processes, assist with asset management, automate warehouse operations, and improve overall efficiencies through real-time data capture and analysis capabilities enabled by RF.

Market Segmentation

• Type Insights (Revenue, USD BN, 2019 - 2031)
• • Active RFID`
  • Passive RFID
• Product Type Insights (Revenue, USD BN, 2019 - 2031)
• • Healthcare tags
  • Commercial tags
  • Correctional tags
  • Others
• End-use Industry Insights (Revenue, USD BN, 2019 - 2031)
• • Healthcare
  • Retail
  • Automotive
  • Logistics and Transportation
  • Surveillance and Security
  • Others
• Key Players
• • Alien Technology
  • AMS AG
  • Avery Dennison Corporation
  • Confidex Ltd.
  • HID The U.S. Corporation
  • Impinj Inc.
  • Invengo Information Technology Co., Ltd.
  • NXP Semiconductors N.V.
  • Omni-ID Ltd.
  • RF Code Inc.