RFID Expert interviewed Mikko Nikkanen, Director, Business Development, UPM RFID, on the company’s products and technology perspectives for the Russian market.
RFID Expert: Dear Mikko Nikkanen, UPM is a well-known paper business brand in Russia. Please tell about UPM RFID’s role as a part of the UPM Group and how long has UPM RFID been in the Russian market?
Mikko Nikkanen: Our company started in RFID business in 1997 as Rafsec among the first players in the RFID tag market. We have always been a part of the UPM Group and we were part of UPM’s labelstock business division UPM Raflatac during 2006-2010. In the beginning of the year 2011 we were rebranded as our own legal entity UPM RFID. Since the beginning of the business our products have been available for the global market including Russia.
RFID Expert: How RFID tag market is expected to grow in Russia? Could you estimate RFID tags’ market volumes in Russia and in the CIS countries by volume of tags (HF and UHF) in 2011? Your expert evaluation.
Mikko Nikkanen: We are still going to see quite a moderate growth in UHF segments like supply chain management and industrial applications. However, retail related, item-level applications might have double digit growth rates depending on new apparel chain roll-outs.
Stable growth can be expected in mass transportation and library, which both are traditional HF segments.
I strongly believe that NFC will also be a big hit in the Russian market during 2012-2013 as new NFC smartphones start to arrive to consumers’ pockets. These new applications using NFC tags might vary from smart posters and coupons to social media and gaming industry.
RFID Expert: What are the emerging industries for your products (i.e. apparel, jewelry, etc.)? What kind of companies are recommended to look for RFID opportunities in your opinion?
Mikko Nikkanen: The previously mentioned NFC business will start to grow in very near term. Printing and converting companies looking for new business opportunities should consider NFC as a potential new business area. UPM RFID is actively looking for partners to establish NFC online printing shops for the Russian market.
In the UHF technology apparel business is still the main interest area for us. Business cases related to inventory check and availability are proven to be very successful and ROI can be achieved easily within 6-12 months in those cases.
The current economic situation at the market shall prefer leverage of RFID as it typically cuts the products’ logistic and handling costs. When right products are available in the stores at the right time, it also increases the actual sales during the peak seasons.
Companies should no more think whether to invest into barcodes or not as RFID solution can be acquired at similar investment level. Barcodes just come into the bargain for almost free.
RFID Expert: Could you reveal some cases of using UPM RFID’s products in Russia?
Mikko Nikkanen: The Moscow Metro was using millions of UPM RFID’s HF products per month for their tickets during 2007-2008. Currently, there are some libraries which are using UPM RFID’s products for books, as well as some apparel companies.
RFID Expert: In April 2011 UPM RFID launched three new tags: UPM MiniWeb™, UPM ShortDipole™ and UPM Dogbone™. Are there Russian companies which are interested in these products?
Mikko Nikkanen: The mentioned products are successfully used in global apparel and logistic applications. A Russian company which is manufacturing clothes, controlling its brand or having stores in Russia and considering to invest in an RFID solution should definitely be interested into trying our market leading and innovative products. We were recently ranked as the global No. 1 UHF tag supplier by ABI research.
RFID Expert: Could you tell us about your authorized partners in Russia through which the end customer can buy your products? Do you divide them by region or application?
Mikko Nikkanen: At the moment we have Systematica, Vital Electronics, R-ID, Antivor and SP Print as our partners in Russia. We are also always warmly welcoming new partners that strongly believe in RFID and have expertise in RFID to work with us.
RFID Expert: In April UPM RFID announced that it has created a global network of partners who provide web-based online printing services for customized NFC tags. Do you plan to extend this network for Russian and CIS countries? Do you have partners for it or are you looking for partnership with local companies?
Mikko Nikkanen: Yes, we are actively looking for partners in order to leverage our NFC portfolio to the Russian market. We have already positioned ourselves as the globally leading supplier of NFC tags with the most complete product portfolio and the largest manufacturing volume but we also need strong local partners to distribute, convert, print and encode inlays into labels suitable for end-use cases.
RFID Expert: Dear Mikko Nikkanen, thank you very much for your answers. I believe this will be helpful for our readers and will assist them in successful deployment and utilization of RFID technology and achieve benefits for their businesses.