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The Industry and Competitive Conditions
Electronic Article Surveillance or EAS, is primarily used by consumer goods retailers to prevent theft (shrinkage), mainly in the form of shoplifting. The aggregate cost of stock shrinkage globally is estimated to be in excess of $70 billion USD and for many retailers, can exceed 2% of gross sales. Shoplifting is widely estimated to represent more than 40% of that figure. Retailers have been combating shrinkage for as long as there has been self-serve stores, and over the years have adopted a wide variety of tools to help them deal with the challenge. For more than 30 years, EAS technology has been a significant part of their toolkit. Although there are several EAS technologies currently available, most retailers use one of just two popular versions: Acousto- Magnetic (AM) and Swept Radio Frequency (RF). In the past, retailers would install the necessary hardware in their stores, and then purchase tags and labels as needed to apply to their merchandise at the store level. More recently, retailers have refined the EAS protection process by asking manufacturers and distributors to partner with them by source tagging consumer goods at the point of manufacture. Apparel is typically protected using a tag that is sewn right into the garment and packaged goods typically contain a label applied inside of the packaging or product. Manufacturers, wholesalers and distributors of popular packaged goods often must keep duplicate inventories of their products for delivery to retailers having either AM or RF technology installed in their stores, creating an entirely different supply chain problem. KMA has developed a comprehensive suite of innovative products to address the specific source tagging needs of retailers, manufacturers and packagers, and as such has enjoyed several years of tremendous growth. |
KMA currently has two branch offices, strategically located in Hong Kong and Taiwan, key centers of production for many consumer goods companies. Future expansion plans include India and Mexico to serve the needs of the South Asian and Central and South American markets respectively, which will enable KMA to further reduce shipping costs and build on its strong reputation for guaranteed on time delivery. Radio Frequency Identification (RFID) technology is widely expected to transition into item level application, from its current role in supply chain management for the retail sector. KMA already has the ability to add RFID to its existing product lines enabling high volume single pass application of EAS and RFID tags at the unit level. KMA's ability to seamlessly evolve with the marketplace ensures that it will maintain its status as a leader in EAS, and move on to attain leadership status in RFID tagging.
KMA is recognized as an industry leader in the field of EAS source
tagging solutions. KMA's competitive position is founded in three key
areas: |
