Top 20 Automatic Data Capture Suppliers of 2017

After two years of sluggish sales, ADC suppliers saw their sales increase as a growing number of companies turn to ADC to accommodate the demands of e-commerce and omni-channel.

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Is the fully wireless workplace continues to come into focus, and as warehouse and DC managers are tasked with doing more with less while exceeding customers’ ever-evolving demands, the global market for automatic data capture (ADC) solutions is growing exponentially. Global sales for such products, which are used in factories, warehouses and logistics applications, reached $6.131 billion in sales in 2016 and are on track to hit the $6.358 billion mark in 2017, according to VDC Research Group.

Breaking those numbers down, sales of rugged mobile devices reached $2.756 billion last year, while sales of bar code hardware (scanners and printers) were $3.375 billion. Between 2016 and 2021, VDC is expecting 4% and 5% growth in those sectors, respectively, with sales of rugged mobile devices reaching $3.189 billion and bar code hardware growing to $4.301 billion over the next four years.

Richa Gupta, senior analyst for AutoID and data capture at VDC Research, says in 2017 she’s seeing “a bit of a downward trend” in the markets she covers, which include bar code scanning and printing. “This is primarily due to the performance of some of the leading players within these markets,” says Gupta, who adds that end user customers are “really pushing back” on refresh cycles for such investments right now and that some product lines have become dated.

Despite those dips, Gupta says 2017 kicked off better than expected for the ADC market, both for bar code scanning and printing. “We’ve seen a lot of new product announcements being made by some of the leading vendors, and that’s helping to accelerate investments in ADC solutions,” she explains. “There are also some macroeconomic trends in place, namely a better overall business environment that’s more conducive to making such investments.”

Top 20 ADC suppliers

2016 Rank

2015 Rank

Company

Total 2016 Revenues
(in millions)

Total 2015 Revenues
(in millions)

North American Headquarters

Bar code printers

Handheld scanners

Stationary scanners

RFID

Mobile computers

1

1

Zebra Technologies (includes Motorola Solutions, Psion)

2,130

2,150

Schaumburg, Ill.

X

X

X

X

X

2

2

Honeywell (includes LXE, Intermec, Datamax-O’Neil)

1,022

1,189

Morristown, N.J.

 

X

X

 

X

3

3

Datalogic

556

524

Eugene, Ore.

 

X

X

X

X

4

4

SATO

200

192

Charlotte, N.C.

X

   

X

 

5

5

Toshiba TEC

158

165

Irvine, Calif.

X

   

X

 

6

6

Denso Wave

123

123

Southfield, Mich.

 

X

     

7

7

Cognex

105

99

Natick, Mass.

 

X

X

 

X

8

9

SICK AG

86

87

Minneapolis, Minn.

 

X

X

X

 

9

8

Casio Computer Co. Ltd

78

88

Dover, N.J.

 

X

   

X

10

10

Fujian Newland

68

74

Fremont, Calif.

     

X

X

11

11

Avery Dennison

65

69

Glendale, Calif.

X

   

X

 

12

12

TSC Printers

77.11

62

Pomona, Calif.

X

   

X

 

13

13

Bluebird Corp.

76.6

59

Palisades Park, N.J.

X

     

X

14

14

Shandong New Beiyang

70

54

Shandong, China

X

 

X

   

15

15

NCR

57

50

Duluth, Ga.

X

X

X

X

 

16

16

Unitech

46

49

Los Angeles, Calif.

 

X

 

X

X

17

18

cab Produkttechnik GmbH

41

40

Tyngsboro, Mass.

X

       

18

17

Opto Electronics Co. Ltd. (Opticon)

39

42

Renton, Wash.

 

X

   

X

19

19

M3 Mobile

34

35

Iselin, N.J.

 

X

X

X

X

20

20

CipherLab

31

27

Plano, Texas

 

X

X

 

X

Source: VDC Research


Leading the pack

Comprising handheld and stationary bar code scanning and imaging devices, bar code printers and ruggedized mobile computing solutions, the ADC market tracked by VDC doesn’t include consumables associated with automatic data collection (i.e., bar code labels). Two top vendors continue to reign in this marketplace, although a number of smaller players are also making positive inroads.

Zebra ranked No. 1 with total 2016 revenues of $2.130 billion in ADC sales, followed by Honeywell ($1.022 billion) and Datalogic ($556 million). SATO, Toshiba TEC, Denso Wave, Cognex, SICK AG, Casio Computer Co., and Fujian Newland rounded out the top 10 by revenues in 2016.

For the handheld scanner sector, Gupta says early-2017 results indicated that overall revenues are 9.6% higher than the year-ago period, following a “greatly improved revenue performance by both Honeywell and Zebra Technologies, market leaders who had a less-than-stellar 2016,” she notes. From a scanning technology standpoint, camera-based imager sales continue to drive overall market growth (up more than 16% in the first quarter of the year), making up for sharp declines in laser scanner sales (down almost 9%). Camera-based 2D imagers will account for 74% of overall handheld scanning revenues by 2021, up from 61% in 2016, according to VDC Research.

Honeywell and Zebra, market leaders through acquisitions, have seen their combined vendor share position in this segment drop from more than 60% in 2011 to 53.7% during the first quarter of the year. “During the same period, companies like Cognex, Datalogic and Fujian Newland have seen a marked increase in their overall share contribution,” Gupta notes, adding that for the incumbents to maintain and grow their market share, it will be “very important to refresh and update product lines to compete with emerging contenders.”

This year, Datalogic, Honeywell and Zebra Technologies are all making strategic investments toward expanding and refreshing their handheld scanner portfolios to address competition in this fragmented marketplace. “The focus is also on setting apart product portfolios by thinking beyond conventional solution types and form factors,” Gupta says. “This includes sleds, companion scanners, multipart form scan applications like Zebra’s SimulScan, and device management platforms for maintenance and support like Honeywell’s Remote MasterMind and Zebra’s Operational Visibility Service (OVS).”

Thermal printing and bar coding

Desktop printers generate a higher percentage of overall revenues at the expense of high-performance and relatively more expensive industrial printers, according to VDC. This speaks to the broader applicability of the lower cost form factor. “Honeywell, SATO, Toshiba TEC and Zebra Technologies cannot rely on brand name recognition and product quality alone to achieve their sales and profitability targets,” Gupta points out, noting that competition is especially acute in high-growth regions like China, Germany and South Korea, where the vendor landscape is a healthy mix of market leaders and emerging contenders.

“It will be critical for hardware vendors to meet compliance legislation, pricing and application-specific labeling requirements of leading end-user verticals in every region in which they compete,” says Gupta, who expects the global stationary thermal bar code printer market will grow 4.4% in 2017. “Our research indicates that revenues are picking up so far in 2017 compared to the year-ago period, due to factors including new product introductions by vendors like Honeywell, TSC Printers and Zebra Technologies, and efforts to address traceability-related requirements in manufacturing and warehousing.”

In the printer segment, Gupta has seen a growing interest in on-demand color label printers (e.g., for chemical manufacturers that use red warning labels on their products and/or packaging). So where traditional thermal bar code label printer makers focus on monochrome products, companies like Epson (on the inkjet side) are “discussing the possibility of including color in labels,” says Gupta, “which is not something that your typical or traditional bar code label printer would be able to accomplish.”

On the mobile thermal printing front, Gupta says the market will grow this year at a CAGR of 6.4%, but says revenues for the mobile printer market were relatively flat in 2016 compared to the prior year, when market leaders experienced a significant sales bump. The limited growth reflected weak demand in the Americas and Europe due to macroeconomic concerns and conservative spending, as the U.S. economy expanded 1.6% in 2016 (the lowest since 2011), and the Eurozone grew at 1.7%, VDC reports.

“Americas, the biggest market for mobile printer solutions by global revenue share, will grow at a 6.5% CAGR through the forecast period,” Gupta adds. “Asia Pacific continues its stellar growth path, up 9% year-over-year backed by investments into the growing retail and logistics segments in the region and will be the fastest growing region through 2021.”

Faster shipments, lower labor costs

David Krebs, vice president of VDC’s enterprise mobility and connected devices, says the key trend driving the mobile market over the last couple of years has been the impact of e-commerce operations and retailer omni-channel initiatives on warehouse/DC development and the expansion of these facilities. According to a recent VDC survey, the top two warehouse improvement initiatives for 2018—which are consistent with years past—are on-time shipments/getting orders shipped faster and reducing labor costs.

AutoID market analysis

Estimated global shipments of AIDC hardware (in millions of dollars)

 

2016

2017

2021

CAGR

2016-2021

Rugged mobile devices*

2756

2846

3189

3%

Bar code hardware
(Scanners and printers)

3375.8

3512.2

4301.5

5%

TOTAL

6131.8

6358.2

7490.5

4.1%

*Includes forklift, handheld/PDAs and wearables

Source: VDC Research


With the average warehouse space in the United States increasing by more than 40%—and during the same period, the average number of workers per warehouse has increased by 20%—Krebs says companies are adopting higher levels of automation and efficiency for their warehouse workers and overall operations.

Within the ADC market, Krebs says the key players have remained constant over the last year. “We are seeing some traction for rugged tablets mounted onto forklift trucks, and that’s bringing companies like Dell, Xplore, Panasonic and Getac in the warehouse in addition to Apple and Samsung,” he says, adding that demand for wearable computing and voice interfaces also continues to grow as organizations look to benefit from fully hands-free computing solutions.

“The real key here is the adoption of modern mobile computing solutions and adoption of next generation mobile operating systems like Android for warehouse operations,” Krebs says. “Outside of ‘Big Windows’ solutions, Windows is a dead-end for mobile computers supporting warehouse applications.”

While much of the rest of the market is migrating toward either Android or iOS to meet their mobile (handheld/smart phone) requirements, the ubiquitous Windows CE/Telnet solution remains resilient, says Krebs. “However, the aging installed base of legacy systems and their poorly designed user interface are keeping organizations from meeting their performance goals.” This will be a driving force moving forward and particularly in 2018-2019, he adds.

While VDC doesn’t anticipate the Windows CE terminal to completely disappear, Krebs expects mobile modernization initiatives to accelerate over the next couple of years. “The top factors driving investments in next generation mobile solutions in the warehouse are the shift to Web-based backend applications; the age of installed base of mobile devices; the optimization of mobile workflows; improved ease of use of mobile devices,” he says, “and mobile OS on existing devices nearing end of life.”

Overall market trends

In looking at the overall market, Gupta says it’s being driven by e-commerce and the various investments companies have to make to keep up with the rapid growth in online sales. “Across several industries, firms are investing in more data capture and labeling solutions to accommodate this explosive growth,” says Gupta, “and namely from the warehouse/DC fulfillment perspective, which plays a critical role in supporting omni-channel distribution.”

Noting that both 2015 and 2016 were largely flat in terms of overall performance within the ADC market, Gupta says things picked back up in 2017. “Vendors seem to be doing much better this year, given all of the over-arching trends that are governing these marketplaces that tend to invest in ADC solutions,” she adds.


Collecting the data

This is Modern’s 15th-annual look at the leading manufacturers of ADC hardware and solutions. Because the industry includes public and private companies, this is the ninth year that VDC Research Group compiled our data. Since they are covering this technology every day, they are closer to the market. To make our list, companies must sell in North America, though the chart includes worldwide revenues. Modern does not include resellers, systems integrators or other companies that do not manufacture ADC hardware. Since our readers are primarily focused on supply chain solutions, we do not include companies whose primary focus is the retail checkout counter or non-industrial settings, like hospitals, libraries or resorts. Nor do we include companies that only manufacture consumables like bar code labels and RFID tags.

 


About the Author

Bridget McCrea, Editor
Bridget McCrea is a Contributing Editor for Logistics Management based in Clearwater, Fla. She has covered the transportation and supply chain space since 1996, and has covered all aspects of the industry for Logistics Management and Supply Chain Management Review. She can be reached at [email protected]

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