The automatic data capture industry is still growing in 2009

Looking for a bright spot in the industrial economy? Then take a look at the automatic data capture industry (AIDC), suggests VDC Research Group. If you’re not familiar with the lingo, automatic data capture includes bar code scanning, voice recognition, RFID, and mobile computing.

“We believe that most AIDC suppliers will see a contraction in growth in 2009 and many may experience negative growth,” says Tom Wimmer, VDC’s director of AutoID and Transaction Automation. “However, the top priority for CIO’s in the coming year is cost management. Manual, time intensive and error-prone processes will be scrutinized, and those AIDC investments that provide a near-term ROI and low execution risk will be accelerated.”  

For that reason, VDC is predicting that the industry overall will continue to grow next year, but at a slower rate than 2008. Based on VDC’s most recent survey of the industry, VDC anticipates 6% growth for 2008, followed by 1.7% growth in 2009, 3.4% in 2010, and 4.9% in 2011.

Slow growth is the primary takeaway from What’s Next: AIDC Market Update, Trends and 2009 Outlook, a recent report and webinar from VDC. Wimmer cautions that conditions could change. The research firm intends to survey clients again in a few months. But for now, these look like relatively good times, with relative being the operative word.

Why is AIDC weathering the economic storm better than other supply chain-related industries? VDC gives four reasons.

Planned investments that support supply chain and customer relationship management will still get the green late because they can reduce overall costs. AIDC fits that bill. “If anything ….. [these projects] may be accelerated during the downturn,” VDC suggests.

AIDC is global, the major players are less leveraged, and their solutions are core to their customers’ operations.

End-users are experiencing tremendous pressure to invest in automation technologies that will allow them to improve inventory turns, enhance customer interaction, reduce costs and enhance their ability to compete. Again, AIDC fits that bill as well.

Finally, even in a down economy, VDC sees continued growth opportunities in emerging markets, where industry and facilities are new and demand for technology remains relatively strong. “The opportunity to leapfrog these core technologies often exists when greenfield applications are unencumbered by legacy systems,” says Wimmer.