AutoID & Data Capture Blog

Changing Competitive Dynamics Herald Big Shifts in Handheld Scanner Market, According to VDC’s Latest Research

by Richa Gupta | 05/24/2017

We recently published market estimates and forecasts as part of VDC’s 2017 coverage of the global market for Handheld Barcode Scanners. The market contracted nearly 2% from 2015 to 2016, per our research, with vendors generating close to a billion dollars for the segment during the year. Revenues from the laser scanner category declined 20%, in keeping with the overarching trend of migration to camera-based imaging. 2D imager-based scanner sales were up more than 7% in USD terms. From VDC’s perspective, it has been interesting to see the transition from 1D to 2D scanning take place with this form factor, especially from the standpoint of the changing dynamics of the global competitive landscape. Market leaders (via acquisitions), Honeywell and Zebra Technologies, have seen their combined vendor share position drop from more than 60% in 2011 to just over 50% in 2016. During the same period, companies like Cognex, Datalogic, and Fujian Newland have seen a marked rise in their overall share contribution. These statistics serve to highlight the technology migration and shift discussed earlier, which has gone from a 35-65 split in favor of 1D laser and CCD in 2011 to one that is almost 60-40 today in favor of camera-based imagers for this product category. VDC expects a continued, marked decline in laser shipments with 2D imagers expected to account for 75% of total revenues by 2021, very different from the state of the market a few short years ago! The move to relatively less proprietary imaging technology (when compared to laser) has served to level the playing field; Zebra, which was most heavily invested in laser, stood to lose the most in terms of market share and positioning. It is, therefore, incumbent upon the company to revamp its offerings and expand the breadth of its imager portfolio to compete effectively against competitive offerings.

Handheld scanner vendors can expect to run into challenges especially given how a growing percentage of physical stores are succumbing to the onslaught of online retail and e-commerce, especially in the US and UK. However, this does also open up opportunities in fulfillment centers, warehouses, and other logistics environments that directly serve the e-commerce boom. There is also significant interest in scanner investments coming in from the healthcare vertical across the globe in keeping with trends related to digitizing hospital health records. Vendors like Code, Datalogic, and Honeywell have historically had a keen focus on this vertical; VDC expects the latter two vendors to be especially well-positioned to capitalize on the opportunity in international markets.

The global handheld scanner landscape is highly fragmented with several vendors from across the world vying for a slice of the nearly $1 Billion in revenue that this market generates. For more information on VDC’s Handheld Barcode Scanners report and the research deliverables, view the 2017 AutoID & Data Capture Research Outline.