Today, we explore the steps involved in implementing a barcode inventory system and answer the following questions:
What is a barcode inventory system?
Barcode inventory systems enable businesses to track and manage their inventory more efficiently. A barcode scanner is paired with software that tracks and collects real-time data, enhancing accuracy and saving time and money. In today’s fast-paced landscape, efficient warehouse management is critical for success. But what exactly is a barcode inventory system, and do you need one?
In a world that is increasingly interested in AI and how it can be used to streamline and enhance business processes, barcode technology is becoming increasingly popular. With inventory previously managed through labour-intensive pen-and-paper tracking and hefty spreadsheets, a barcode inventory system replaces these outdated methods with automated processes driven by barcode technology.
For decision-makers that are tasked with managing large, complex, inventory flows and multiple locations, these systems provide a game-changing solution. Efficient warehouse management hinges on the elimination of error-prone, manual tracking. With every item tracked in real time as it moves through your business and to its final destination, delivering your uninterrupted operational insights twenty-four hours a day, 7 days a week, three-hundred and sixty-five days a year.
Barcode inventory systems aren’t just for warehouses. They offer significant benefits for a wide range of industries and businesses. Bricks-and-mortar and e-commerce retailers benefit from better stock management and picking and packing; healthcare providers can improve patient flow and satisfaction through the tracking of medications, devices and equipment, and logistics companies can gain better visibility over the movement of goods.
Key elements of a barcode inventory system
Barcodes
A barcode inventory system would be nothing without the barcode itself. The barcode is typically made up of two parts; a series of graphic vertical lines (the barcode) and a human-readable number printed on a label. Using a barcode scanner, the whole graphic is scanned and read by the reader, transferring the associated data to your device in real time. While the majority of barcodes work in the same way, there are a number of different types and functions of barcodes to be aware of. For example, the barcodes used in hospitals and on medications must meet strict GS1 standards, while shipping and retail barcodes contain vastly different information from one another.
Learn more about the various applications of 2D barcodes and how they work.
Barcoding and labelling software
Unlike many other graphics that you might use for your business (think your logos, letterheads, web and social media graphics), barcodes have a much more technical edge to them. Inventory means products, and it’s critical to keep track of them all effectively and efficiently. In order to create your own barcodes, you’ll need barcode and labelling software to do so.
With this software, you can design, and then print, barcodes and labels that are customised with the information that’s required for your inventory. This might include product names, serial numbers, expiry dates, shipping details, and more. Once the label has been created, you simply need to print it and attach it to your products.
Learn more in our guide to choosing the right barcode and labelling software.
Barcode printers
Your barcodes need to get from your software to your inventory one way or another; which is where barcode printers come into the mix. Larger businesses will typically have a warehouse where products are created, packaged, and shipped from, but SMEs who may not be in a position to outsource their barcode needs may find that investing in barcode printers is a great way to get started. These printers are specifically designed to print the perfect barcode, every time. While a poorly printed barcode in a retail environment may result in stock theft through incomplete scanning, a poorly printed barcode in the health industry could be the difference between life and death.
Barcode labels for warehoused items
Unlike barcodes for individual products in a retail environment, barcode labels for warehoused items play a vital role in the inventory management process. The use of barcodes enables efficient tracking and identification of products from the moment they arrive, are stocked, and then depart the warehouse providing real-time data on everything from stock levels to location for picking and packing.
Barcode scanners
You have your barcode, but now you need a device to read it with. Barcode scanners and readers come in all shapes and sizes from handheld to fixed mount and mobile scanners to wands, each of which are designed to suit different applications and operational needs. They all function in a similar way though; converting the detected light pattern into an analog electric signal which is then processed by the scanner’s decoding software. Once the barcode is decoded, the scanner transmits the extracted information, be it product identifiers or serial numbers, to a connected device like a computer, point-of-sale (POS) system or inventory management software.
Inventory control systems
The final piece of the inventory management system is your inventory control software. This serves as the central hub for all inventory-related activities, facilitating seamless coordination between your barcodes, scanners and warehouse personnel. It stores all of your inventory details from product descriptions to stock levels and, of course, your barcodes. It integrates with your barcode labelling systems and printers, and your scanners to capture the real-time data from our labels. In addition to this inventory control software also facilitates order management, inventory allocation and generates pick lists for fulfilment. It can also be used to generate reports and analytics for further optimisation and efficiency gains. It really is the epicentre of your inventory management processes.
How does a barcode inventory system work?
A barcode inventory system works by assigning a unique barcode to each item, encoding it with information. This barcode is scanned when an item is picked: the transmitted information lets the picker and the stock control software know that the correct item has been picked for dispatch.
It’s slightly more complex than this, of course. By scanning barcodes at each point of the warehouse process, the system maintains accurate records of inventory movements, stock levels, and locations. This visibility allows businesses to effectively track and manage inventory while reducing errors and improving operational efficiency.
What are the benefits of having a barcode inventory system?
With every inventory item featuring a unique barcode, operations become more efficient, faster and more accurate. But the benefits expand beyond accuracy and efficiency. They minimise the risk of errors and unaccountable losses, are quick to implement and cost-effective versus other solutions, too.
More accurate inventory tracking with real-time data
It’s not news that by automating manual tasks, warehouses can achieve more accurate inventory tracking and optimise your warehouse operations. Humans are prone to errors, especially when busy or bored with repetitive tasks. Automation increases accuracy, reduces errors and alleviates stress on the workforce. Rather than relying on fallible spreadsheets or pen-and-paper tracking, warehouse operators simply need to scan items to log them in your system. No more manual handling means that the need to remember storage locations, quantities and stock levels are eliminated.
Minimises risk of errors and unaccountable losses
Many warehouses suffer losses that cannot be traced or accounted for, whether by theft, misallocation, or oversight. However, when all items have a barcode, they can be traced through the system so it’s much easier to spot where in the process they go missing.
One of the most common points for unaccounted losses is often during the manual picking process. By leveraging warehouse automated picking systems which rely on barcodes to identify the location of products, businesses can significantly reduce errors and losses throughout the inventory management process. In the traditional picking process, manual errors can lead to misplaced items, the wrong products being picked, or miscounted stock levels. By using automated picking systems such as robotic pickers, inventory is selected and retrieved based on predetermined instructions. The automation process not only improves accuracy, but it also reduces the risk of theft and shrinkage thanks to real-time tracking.
Relatively simple to set-up
In its simplest form, a barcode inventory management system comprises barcodes and a barcode scanner and can be scaled up from here. Your inventory management system doesn’t need to be rolled out all at once; you can expand your hardware, software and tools when the time is right for your business. Barcodes are one of the most straight-forward inventory control systems to implement as you can build your own system that meets your current needs, and add to it as your confidence and requirements grow. If you want to give yourself the greatest benefit from the outset, then working with an expert partner like the Barcode Warehouse will set you up for success from the get-go.
Cost-effective
While the initial outlay to invest in your barcodes, scanners, printers and software may feel counter-productive, introducing barcode inventory management will save you money across multiple touch points in the short, mid, and long-term.
Getting started with barcode inventory can be as simple, or as complex as your business needs require, and can be scaled over time. Where you will see the impact of your investment is through freeing up substantial volume of staff time as laborious manual paperwork is reduced. In addition to this, it can also dramatically reduce the costs associated with over-stocking or having to rush orders when surges in product popularity appear. We discuss this in more depth in the next section.
Maximises efficiency and productivity
When introducing an inventory system alongside initiatives such as automated picking and packing, you’re freeing up your workforce to deal with more challenging work that can’t be made more efficient through the use of automation or robotics. Reducing repetitive tasks such as picking and deploying your staff to focus on other ways to improve efficiency and productivity not only increases morale, but can also help with recruitment and retention, and save the costs associated with those.
Learn more about improving warehouse efficiency.
Who needs a barcode inventory system?
Barcode inventory systems are beneficial for businesses in many industries as they can be customised to the needs of the business. If your business handles inventory, maintains a barcoding inventory, or deals with vendors requiring barcodes, you may benefit from such a system.
If you are facing challenges such as difficulty locating items quickly, excessive time spent on stock-taking tasks, or frequently experience issues with incorrect order and inventory errors, then a barcode inventory system is essential. While these are broad challenges that barcode systems can help to alleviate, there are industry-specific challenges that can be overcome with a newly implemented inventory system.
For retailers, the significance of a barcode inventory system lies in its ability to streamline stock management. Rather than relying on pen and paper inventory logs, and manual stock takes, a barcode system ensures accurate tracking of stock and the timely replenishment of products. This allows retailers to avoid costly over stocking or the risk of out of stock products that are in high demand.
In healthcare settings, the system aids in the meticulous tracking of medical supplies, pharmaceuticals and equipment. Using barcode and RFID technology assists in optimising patient flow which, in turn, improves patient safety and minimises the risk associated with medical errors.
The construction industry benefits from barcodes systems by efficiently managing materials, tools and equipment. Knowing the exact details of what is on-site, where it is, and who it’s allocated to makes projects easier to cost, manage, and deliver on time and on budget.
Last, but not least, warehouses serving as hubs for storage and distribution often rely on enterprise level barcode inventory systems to maintain accurate stock level, deliver quick order fulfilment and enhance overall logistics. Not only does this help internal operations and warehouse managers, but for their customers, too. We delve into this more in our guide ‘How to implement a barcode inventory system in your warehouse’.
Through the automation of manual tasks such as data entry, barcode systems can help businesses of all sizes and industries reduce the costs associated with errors, improve customer satisfaction, and even gain a competitive edge in the market. With real-time visibility of inventory levels, locations, and even forecasting demand, these systems optimise the entire process from receipt to transport, picking, packing and dispatch. The ultimate outcome is improved efficiency and profitability - who doesn’t want to be putting that in their reports?
See how a barcode inventory system transformed Avant’s warehouse management system
How to choose a barcode inventory system?
Choosing the right barcode inventory system will depend on the industry that your business is in. Barcode technology can benefit almost every industry from bricks-and-mortar retail to healthcare, and manufacturing to logistics.
1. Assess the needs of your warehouse
The first step is to evaluate the specific requirements and challenges of your warehouse operations. Are tasks taking too long, are you experiencing high levels of unaccountable loss, do you need to improve your customer feedback? Taking the time to consider your pain points as well as factors such as the volume and variety of your inventory, your current and desired workflow processes, storage conditions and current systems are all important steps to take before you start to progress.
2. Have a clear understanding of your requirements
Once you know what your needs are, it’s time to define your objective and priorities for implementing a barcode inventory system. You should identify and benchmark key metrics that you want to benchmark and track as signs of success. These might be things like inventory accuracy, efficiency gains, error reductions and cost savings. Understanding your goals will guide the selection process and ensure that you’re choosing a system that will have a positive impact on your business. Don’t forget that Rome wasn’t built in a day – gathering some of this information might take time.
Once you’ve got your needs and objectives, it’s time to research and compare the different inventory systems that are available on the market. Evaluate key features such as real-time tracking, scalability, integration capabilities, ease of use and reporting functionalities. Take the time to consider how each system aligns with your warehouse’s unique requirements and objectives.
As we have mentioned already, while upfront costs may be involved in implementing a barcode inventory system, the return on investment (ROI) over time should be your real objective. Calculate the cost savings and efficiency gains from improved inventory accuracy, reduced errors, labour savings and better operational efficiency and choose a system that offers the best balance of features and benefits.
Discover and experience barcode inventory system solutions for your business
Discover and experience barcode inventory system solutions for your business by visiting our Innovation & Customer Experience (ICE) Centre. In our ICE Centre, you can explore the latest technology solutions firsthand and receive a consultation tailored to your specific needs.
At the ICE Centre, we offer bespoke solutions labs designed for enterprise businesses in the UK. Our Solution Architects are on hand to help you understand how new technologies can address your unique business challenges. You'll engage in an immersive experience with demos of our industry-leading solutions, including warehouse management systems (WMS), mobile working and packaging, inventory control, warehouse packing stations and more.
Our ICE Centre provides a comprehensive experience where you can test and evaluate these solutions in a real-world setting. Whether you're looking to streamline warehouse operations, improve inventory management, or enhance mobile working capabilities, our Solution Architects will guide you through the process and help you find the right solution for your business needs.
How to set up a barcode inventory system for a warehouse
Implementing a barcode inventory system can truly revolutionise your warehouse operations, improving efficiency, accuracy and overall productivity while reducing downtime, losses and labour-intensive, repetitive, manual work. Getting started is easier than it might sound, just follow these next steps for setting up a barcode inventory system that’s tailored to your specific needs.
Decide which warehouse barcode inventory system you need
It’s crucial to know what direction you need to be facing before you start running. Before you dive straight into implementation, assess your warehouse requirements and base your barcode inventory systems on that data. Key factors to consider will be the size of your inventory, workflow complexity and integration with existing systems.
Select your hardware
Selecting the appropriate hardware is one of the most important decisions that you will make. Again, think about your personnel and when and how they work.
If your workforce often find themselves in tough environments and exposed to extreme temperatures then use a rugged, wireless, barcode scanner like the Zebra DS3678-ER Rugged Cordless Barcode Scanner which delivers exceptional durability and versatility.
For an even more robust solution the Honeywell Granit XP 1991iSR Ultra Rugged Cordless Industrial Barcode Scanner has a best-in-class 10’ drop specand is engineered to keep on working after the impact of drops from loading docks, fork trucks, and picking trucks. Being cordless means that your workforce are able to scan their data from anywhere within your workshop; delivering the latest inventory levels from wherever they are working.
It’s not just warehouses where hardware choice is important. For healthcare providers where accuracy and portability are essential to allow bedside scanning of medication or specimens, the ultra-portable Zebra CS4070-HC Companion Scanner is small enough to be slipped in a pocket or worn on a lanyard. Bluetooth-equipped, one press of the pairing button will connect the scanner to other Bluetooth-enabled in-room computers, workstations-on-wheels, tables and more.
With your hardware decisions made, choosing a software package that aligns with your warehouse management needs and integrates effortlessly with your barcode system is the next step. As we’ve mentioned before in this guide, ensuring that your software meets your needs is crucial.
Options like the Microlistics WMS and Peoplevox are firm favourites with warehouses. With Microlistics, the system can power your whole technology device estate, from barcode scanners, mobile computers, pick-by-voice & pick-by-vision and radio-frequency identification (RFID) to automated cranes, conveyors, storage and retrieval systems and other materials handling equipment. As a Microlistics Partner, The Barcode Warehouse can help you begin the journey to efficiently controlling and monitoring the flow of products through your warehouse.
You should also review the after-sales and ongoing support provided by your chosen software supplier. At the Barcode Warehouse, our Managed Services include proactively looking after the deployment and maintenance of your devices and software as well as delivering training and implementation.
Once you’ve selected your hardware and software components, it’s time to set up and actually implement the barcode inventory system. Depending on your levels of integration this will include getting your hardware set up. Scanners and printers will need connecting to your networks and devices and software will need to be installed. Many systems are straightforward to set up without outside support, but for a seamless experience, we strongly recommend that you utilise support from your provider to get you up and running as quickly as possible.
Prior to implementation you should also start to think about how you intend to establish standard operating procedures (SOPs) and train your employees on your new systems.
Don’t leave it until the day after your system is in place to think about how you want your workforce to be using your systems. Take the time to document your SOPs including barcode usage, scanning protocols and data management practices. Your supplier should have a range of training materials ready to roll out to your workforce, but also think about selecting champions within your teams to ensure that standards are being met and that everyone understands how things work. Providing comprehensive training is essential to ensure the successful implementation of your barcode inventory system. Educate everyone on proper scanning techniques, data entry procedures and system navigation to optimise workflow efficiency and minimise errors. Don’t forget that training isn’t a ‘one and done’ situation; you should book in regular refreshers and continuous upskilling to ensure that the systems are being used as effectively as possible.
Integrating warehouse barcoding with your WMS
Efficient warehouse management relies on seamless integration between your barcode and labelling software and your warehouse management systems (WMS). For those with an existing WMS it’s vital that you check your software’s compatibility with your chosen barcode inventory solution. You don’t want to find yourself in a situation where you have invested time and money in a new barcode inventory system only to discover that it also means a complete overhaul of your existing WMS.
Interested in learning more? Explore a range of warehouse management system software solutions from the Barcode Warehouse to enhance your warehouse operations.
How can The Barcode Warehouse help?
When it comes to implementing a barcode inventory system, there’s no-one better placed to support your decision-making and implementation than the team here at the Barcode Warehouse. For over 35 years we’ve been helping warehousing businesses to operate more efficiently, increase performance and be more competitive.
We can help you choose the right technology solutions bespoke to your business. Whether you want to discuss your hardware needs and the difference between the available barcode scanners and printers on the market or want to discuss full implementation or overhaul of your warehouse technology and software solutions then our experts can help.
For those looking for a fully managed service we offer some of the most comprehensive enterprise mobility managed services on the market. As part of this service we manage the entire lifecycle of your devices and systems. We work with you to understand your organisation’s needs and recommend a tailored service that is so much more extensive than your typical managed repair loop. From proactive device management to business intelligence we have over 10 services that can be combined to build the perfect package.
Want to see us in action? Download our guide to learn more about how to implement a barcode inventory system for warehouses. This in-depth guide covers everything you need to, and you’ll also see how we helped an award-winning skincare brand implement a barcode inventory system that transformed its warehouse process and business outcomes.
