In case you missed it, a recent report from E Ink Holdings (EIH) confirms that capacity at its Northern Taiwan fab in Linkou, is fully booked, primarily from the growing demand in the electronic shelf label (ESL) market. This is forcing the company to look to the USA fab to help augment the supply of the company’s retail display device while they consider new fab options going forward.
And the market is booming. According to Sigmaintell, shipment volumes of electronic shelf labels (ESLs) will reach 100M devices globally in 2018, with an annual growth rate of 18%. The typical ESL technology includes low power display modules (like electrophoretic displays from E Ink), control panel and a power source. Key application include retail shelf label replacements that offer significant efficiencies including reducing error rates, and labor costs and allow for instantaneous price updates
?North America is the largest market for electronic shelf labels globally, according to Electronic Shelf Label Market – Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2018 – 2023 that stated,
“The electronic shelf label market was valued at $397.22 million in 2017 and is expected to reach a value of $1.24 billion by 2023 at a CAGR of 21.03% over the forecast period of 2018–2023. The huge market in this region can be attributed to the vast presence of retail stores, both small and big, across the region, led by retail giants, such as Wal-Mart, driving the upsurge in activity, largely contributing to the market growth”.
For EIH, growing display size is helping drive demand for ESL capacity as the company sees size increases extending from 2.9″ diagonal to larger electronic shelf labels in the 5.65″ to 7.5″ device size. Consequently EIH reported expectations of strong sales in Q4-18 that should continue into 2019, according to company president, Johnson Lee.
E Ink’s take on their competitive advantages in the space include: extremely low power consumption (with up to 5-year battery life), a wide viewing angle supporting top to bottom shelf ESL tags with “easy readability,” viewable optical performance even under high ambient lighting conditions, wide temperature range.
- the EIH “Aurora” line is formulated for freezer applications to -25ºC
- the Spectra 3-color line support highlight red and yellow colors to promote various sale items.
It seems that retail is finally catching up to the labor and administrative efficiencies the new technology can bring to the segment, particularly in developing areas with large retail networks and record low unemployment levels. This is a good thing for EIH that has a competitive advantage in the space with low power high resolution display solutions that meets the needs of this growing market quite well.
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