VDC Research: RFID, Barcode, Retail Automation & Self-Service Market Blog

What, did you say, is in my burger? – Averting a PR Nightmare Using Barcodes

Track-and-trace is well-regarded as the most important capability afforded by barcode labeling. Enterprises across economic sectors and installation environments have, over the years, extensively leveraged this feature to enhance visibility into their supply chains and keep a close watch on the movement of goods. I came across this post on the Enterprise Labeling site run by Loftware, one of the leading barcode label generation software solutions vendors, a few days ago.

While it was pretty shocking to read about the presence of horsemeat in what was sold as ground beef, I didn’t think too much about it until I read Burger King’s official press release stating that their burger meat was most definitely tainted as well – and that their customers in the UK and Ireland were unwittingly feasting on non-beef burgers. And then brands including Tesco (one of the world’s biggest retailers, based out of the UK) and Findus (a large prepared foods producer and retailer, headquartered in Sweden) confirmed meat contamination in the products that they sell. French retailers including Carrefour and Auchan have also recalled food supplied to them via Comigel, one of Findus’ leading distribution partners in the region. This whole controversy has spiraled into a PR nightmare for retailers and food manufacturers, one with far-reaching consequences especially as it directly impacts the health and well-being of consumers.

Organizations in the retail, hospitality (dining), and food processing and manufacturing industries need to impose strict adherence to their safety and quality standards regulations. Such comprehensive mandates will serve to ensure that every “touchpoint” in the commercial value chain feels equally responsible and is deemed liable to any misappropriations that may occur. Where do barcodes fit into this scenario? Like with their use in the pharmaceuticals supply chain to prevent counterfeiting, for example, barcodes are increasingly being leveraged by food companies to ensure the quality, authenticity and safety of their products as they move from source to consumption. Barcoding supports chain-of-custody tracking and helps manufacturers and their distribution partners “document” product trail from source to consumption. Their penetration, unfortunately, is not nearly adequate, as evidenced by this most recent horsemeat scandal.

As this scandal is exposed and a large-scale investigation gets underway, I also fully expect a rise in the use of QR codes on food packaging (particularly for meat and seafood) that will possibly serve to inform consumers using smartphones and other handheld devices about the source of their food, helping them make an intelligent purchasing decision. VDC will be following this story as it unravels and keep you updated on any developments that have the potential to directly impact the barcode technology market.

Dissecting Honeywell’s Intermec Acquisition: The Potential Road Ahead

Yes, it has been a few weeks since Honeywell announced that it had signed a definitive agreement to acquire Intermec. While this continues to be subject to regulatory approvals, in this blog post I share some thoughts on how this deal may shape up and impact the barcode vendor landscape. Intermec is an active participant in two barcode technology hardware markets – Barcode Printers and Handheld Barcode Scanners. The company has a relatively small presence in the barcode scanning market, with a recent entry into the general purpose scanner space. However, in this category Intermec is up against industry behemoths including Motorola Solutions, Datalogic and Honeywell. I expect Honeywell to fully integrate this part of Intermec’s business into their own; especially given how closely aligned it is with one of Honeywell’s core AIDC competencies. Barcode printing is, however, a whole other conversation.

Intermec is one of the leading barcode printer vendors, according to our research. They rank 5th in our global vendor share chart and are considered to be among the most innovative and resilient brands in the space. Intermec has, over the past 12-18 months, introduced several new barcode printers to the market across all form factors – desktop, industrial and portable. Backed by its strong IP in the space, the organization is well-respected and has a strong presence in each of the regional markets. Is this a business that Honeywell has experience in and is entirely comfortable with? Now this is pure speculation, but I would think not. In my opinion, Intermec’s real value for Honeywell lies in its following areas of expertise – rugged mobile devices, voice technology, barcode scanners and RFID. The barcode printing and media/consumables business is quite possibly one that Honeywell would look to sell to a suitable candidate with an inherent knowledge of this fragmented market and its competitive dynamics, particularly as this doesn’t necessarily fit in with Honeywell’s growth strategy.

To determine the likely contenders vying for Intermec’s barcode printer and consumables business is challenging, but here are my two top picks:

1. ZEBRA TECHNOLOGIES – the undisputed global leader in the barcode printing market. Zebra has a long history of innovation, credibility and dominance in this space. By acquiring this part of Intermec’s broad product portfolio, the company would gain considerable share in each of the regional markets while also successfully leveraging Intermec’s significant presence in the Manufacturing and Transportation & Logistics verticals. Intermec’s strong printer consumables sales would only work to sweeten the pot.
2. SATO CORPORATION – barcode printer market leader in Asia-Pacific, with a much smaller presence in other regions. SATO is a billion-dollar AIDC organization with a business model that is a little different from that of its competitors – a much heavier contribution of consumables sales to overall revenues as opposed to hardware. SATO could significantly benefit from Intermec’s strong barcode printer sales into the Americas and Europe, growing its market presence and share in these regions via a single acquisition.

While it is all pure speculation at this time, I will certainly be keeping an ear out for any such market developments. Stay tuned.

(You can read my other post on this acquisition here)