SMARTRAC has been a leader in RFID with the largest sales in a variety of industries, across all frequency types, partnering with all the major chip companies. In the past, they depended on their source partners (chip makers) as well as having a substantial portfolio of solution and software companies for channels. But most of the major tag companies have been taking the leap and are either developing or acquiring their own solutions companies. The whole solution — not just tags — is the play today. Yet, with such a strong channel portfolio, it is somewhat of a risk to acquire your own.
Catalyst has been an innovator in solutions, mostly for retailers, for the last decade, with a strong showing in some important retailers such as Belk, Bloomingdales, TJX, and many grocery chains such as Whole Foods, and Kroger. For them, though, it is a crowded field with so many solutions companies competing for a slice of the mega IT budgets in Retail. With the outrageous marketing expenses required and the tough negotiating tactics of retailers, going it alone is tough, even with Li and Fung’s backing.
So the union makes sense. SMARTRAC talent can continue to innovate on hardware but get deeper insights into the business thinking and solutions that retailers want. The Li and Fung ‘connection’ in source markets opens the door for more suppliers of retailers. And Catalyst is brought to the table more often, with an extra advantage of assurance of a highly integrated solution as a selling point. That is not to say that there won’t be other hardware in the mix. Case in point, and cool, is Catalyst’s foray into robotic solutions for inventory management.
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