Barcoding is a traceability system used by companies in all industries.
In this article, we’ll explain exactly what these devices are used for, how they work, and how useful they are in a business context.
Definition of barcode
A barcode allows you to display data that is machine-readable. This data is materialized through lines, which are the graphical representation of numbers. Therefore, this symbol allows for automatic data entry each time a scanned article is read.
The code is materialized as a series of 13 digits and is called the Global Trade Item Number (GTIN). Barcodes are all around us, on every product we buy at the store: food, clothing, electronics, and more.
The origin of the barcode
In 1952, the first patent on barcodes was filed by two Americans, Norman Joseph Woodland and Bernard Silver. These two engineers were looking for a solution to automate product registration for manufacturers. That’s why the inventors came up with the idea of combining the sound system of the film with the Morse code.
To translate these black lines and white spaces of information, the code must be scanned with light. Only after 20 years of technological development could the technology be developed and used.
It was in the early 1970s that the utility of the barcode became apparent. They were used in supermarkets to automate checkout. This is the problem we all know today.
Incidentally, the first item with a barcode to be scanned at checkout was a pack of Wrigley’s gum. It happened in 1974 in Ohio.
Ease of use is what explains the success of the barcode and its survival over time. It can also be explained by the low cost of production, universality, time saving and reliability.
What is the purpose of a barcode?
The GTIN code, which has been translated into a barcode, is mainly used to identify a product circulating in an economy. Thanks to this unique coding, it is possible to know everything about the product: its composition, country of origin, manufacturer, etc.
This is not the only use of the barcode, which has managed to stand out in the eyes of retailers, performing a number of tasks. This has made it indispensable especially for good business management.
Identification is the first step in the traceability system, and automatic identification enables you to know everything about the product and control and manage the company’s flows and stocks.
What are the benefits of barcodes?
The barcode is standard in today’s business and commercial industries. This is due to the number of advantages of this type of identification.
Time savings for the consumer
When barcodes were first introduced to the retail industry, they allowed consumers to spend less time at the checkout counter, cutting down lines. As a result, the number of supermarkets increased and sales volumes increased, resulting in lower prices for the final consumer.
Supermarkets that sell large quantities of products have benefited from the introduction and use of barcodes. Small retailers that distribute smaller quantities of products were not initially interested in these codes because it was not profitable for them in the short term. Supermarkets were particularly successful at this time, encouraging consumers to go to supermarkets, saving them time.
In addition to being more fluid, the payment process is also more reliable as the consumer gains trust.
Better management of product flows and inventory
Whether on a small or large scale, barcoding is the most efficient and reliable method for optimal inventory management.
Using this method allows automatic, highly accurate and fast (even instant) stock tracking. Likewise, barcoding saves valuable time when preparing orders and creating accompanying documents.
This then provides visibility into stock levels, making adjustments as needed. Products are organized and tracked automatically, eliminating manual entry errors. Likewise for new SKUs, it has become easier to manage the continuous flow of new products.
Replenishment is faster and supply diversification is easier, which was physically impossible before.
For retailers who buy their products from different suppliers, this allows them to know which products they are buying. Moreover, at a time when consumers generally distrust manufacturers, barcodes can help them control what they buy.
Fight against fraud
Every time a product code is passed through the checkout, it is directly and automatically recorded as a sold product. Such a system helps to avoid possible fraud.
In addition to all the advantages already mentioned, the appearance of the barcode in commerce has led to the development and spread of loyalty cards. These have led to the introduction of the use of statistical data analyzing consumer preferences.
What are the disadvantages of bar coding?
Although bar coding is a very efficient and profitable system, it is as infallible as any other stock tracking method.
Barcodes can only be read by a dedicated barcode reader, which can be a significant investment for smaller retailers with other priorities.
In addition, information storage is still limited.
What are the different types of barcodes?
There are two types of barcodes:
- One-dimensional (1D) barcodes;
- Two-dimensional (2D) barcodes.
1D barcodes are affixed directly to product packaging. 2D barcodes are called QR codes or Datamatrix.
How to get a barcode?
You can use GS1 and its CodeOnline tool to generate your own barcodes.
How to read and scan a barcode?
Barcodes are decoded by linear optical reading using a laser beam. This means using a scanner known colloquially as a “shower head”. This means that the identification is automatic and immediately leads to the product price account, as well as computerized warehouse management.
Thanks to the numbers written under the barcode, certain information becomes available without scanning the code, especially for the consumer. The most common codes are used worldwide and cover almost all consumer products. As the name suggests, the GTIN 13 code consists of 13 digits, which mean:
- The first 2 or 3 numbers refer to the country of manufacture of the product. For example, after a simple Google search, you can easily find the country of origin of a given product. Here are some of them. 500 to 509 United Kingdom, 000 to 019 USA, 300 to 379 France, 690 to 699 China, 840 to 849 Spain, … However, it is important to note that these numbers correspond to the country : which company is a member of the GS1 system. Therefore, not necessarily the country of production, but the location of one of the headquarters of the company is indicated;
- The following numbers correspond to the company prefix given by GS1:
- The following numbers correspond to the reference (or product code) assigned by the trademark owner:
- The last character is a check character to verify that the barcode is valid.
More and more smartphone apps are being developed and made available that allow consumers to scan and read barcodes on products in their hands. By scanning these codes with their phones, consumers can access additional information about the product.
For example, the Yuka app rates the quality of food and cosmetics out of 100 to provide health information. The consumer simply downloads the app to their phone and scans. Thanks to this, they can, for example, learn about the nutritional properties of the product: salt, sugar content, etc.
Finally, this code, which was used mainly by companies seeking to optimize their productivity and stock management, is now also used by consumers who can check the composition of the products they have purchased/potentially purchased at any time.
Where to place a barcode?
To find out how to print these codes, you need to look at your product. Want to embed your code directly on a product, like bottles or cans? Or do you want to place your barcode on a label, such as on textile products?
The label is a classic format that involves printing your code in a rectangular format. However, depending on the shape and material of the product, you can be innovative and original with phased barcodes.
Use of barcodes in e-commerce
After a long non-commitment for e-retailers, GTIN declaration is becoming essential for online sales, regardless of the chosen channel.
In the e-commerce industry, especially marketplaces, having products with a GTIN code is a must. This allows you to gain visibility over them.
According to GS1, 0.35% of GTIN codes are incorrect. Although some e-retailers ignore these codes, they do have an impact on their business. Indeed, Google and Amazon require the presence of these barcodes in the catalog. If this is not the case, the relevant product link is downgraded. Conversely, the more information you provide, the better you will be referred, thus influencing your potential sales.
This information is especially relevant when we know that 90% of search traffic comes from Google and that 28% of Internet users directly search for desired products on Amazon’s marketplace. According to Google, product listings with a GTIN have 40% higher click-through rates, resulting in 20% more sales.
Also, if you enter the product’s GTIN in the marketplace, it provides you with information about the product. This allows you to expand the list with new information and photos, for example, saving you time and trust.
Thanks to your quality product catalog and customer reviews, marketplaces can offer your products in additional sales modules.
Barcodes then allow you to manage various information about your products, their inventory and gain visibility into your distribution channels.