What tools does your business need to set up an inventory management system? The familiar barcode or the increasingly popular QR code? How are they different and what are their benefits?
Barcodes and QR codes are easily spotted on products, receipts, marketing material, and even used in digital wallets. Whether it is the parallel lines of a barcode or the square matrix of pixels in a QR code, we are all familiar with these coding tools.
What happens when we view these codes as a business and not a customer? For most companies, tracking products or inventory is an essential process. While both the codes have the same fundamental function, of labelling products to enable inventory management, does one offer more advantages than the other?
How should a business owner decide between using barcodes or QR codes?
This article is designed to help small and medium-sized businesses owners and managers understand the differences between QR codes and barcodes. To be empowered in making an informed decision about which system is most appropriate for their business.
All About Barcodes
Application and Benefits
Invented out of necessity, barcodes have been a norm in the retail, inventory, and supply chain management processes for decades, after being formally patented in the USA in 1951.
These small rectangles of varying horizontal lines (or bars) are usually printed on product packaging that we see most often in retail stores and supermarkets. These bars contain vital information such as the name, manufacturer, type, colour, and price of the product or asset they are tagged on. They form the foundation of shipment tracking, warehousing, asset management, ticketing, and several other B2C (business to consumer) and B2B (business to business) processes.
There are different types of barcodes, and the specific sequence of bars and characters signify their usage. Barcodes can represent numeric digits, as well as incorporating alpha-numeric information.
The international system for book records ISBN uses barcodes. Similarly, UPCs (Universal Product Codes), EAN (European Article) Codes, and ITF Codes (used on corrugated cardboard boxes) are other commonly used items that use barcodes.
“Barcode systems offer basic inventory management for small and medium retail businesses with limited product range and inventory. They are suitable for small companies that are scaling rapidly and finding it tougher to manage their products and point-of-sales operations manually.”
All about QR Codes
Uses and Advantages
QR (quick response) codes are an advanced two-dimensional version of barcodes, resembling a small matrix square. Unlike barcodes, QR codes contain information both vertically and horizontally.
Created in Japan in 1994, QR codes were developed to simplify production processes Their adoption has increased over the last decade, due mainly to the ability to directly interact with consumers using smartphones.
QR codes are made-up of small, pixelated cells forming a square matrix; the smallest usable size is 21 X 21 cells, they increase in sets of 4 X 4, with a maximum size of 105 X 105 cells. As QR codes have an added dimension of data storage space, these codes can contain more than just numbers and alphabets.
Upon scanning they can reveal information such as location, contact details, URLs, forms, instruction manuals, and even prompting actions, like downloading an app or sharing a post on multiple social media platforms.
From global businesses like Amazon to small street-side cafes, QR codes track shipments, tag products, facilitate digital payments, and enable event registration. They are also used to create digital documents like e-menus and work effectively as call-to-actions in marketing campaigns. Most recently they have been widely adopted for contact tracing during the Covid-19 Pandemic.
How to set up an inventory management system with barcodes?
To set up a barcode system at your place of business, you need a barcode printer and scanner, label sticker rolls, and specialised software to operate the system’s devices. There are dedicated apps available to enable devices with cameras to function as scanners.
Using barcodes in your business operations will simplify product management and streamline the entire supply chain process. Improving efficiency and saving on labour costs.
If you don’t have a recurring requirement for barcodes and have limited products, you can use a free simple barcode generator to create barcodes online.
These universal codes are cost-effective for use over time, as once you put in place the barcode management system, it can work seamlessly for years. The devices and software are simple to install and manage.
How to set up an inventory management system using QR codes?
Setting up a QR code system is simpler than setting up a barcode system. There are a multitude of bulk QR code generators available online, and you can simply create as many QR codes as you want, with predefined data and actions.
Dependant on the products you wish to track, QR codes can be physically printed or used primarily digitally. Small retail stores will need a QR code scanner, or to set-up a software system or an app on a dedicated device, to effectively scan the codes.
“QR codes are best used by small and medium businesses with a strong digital presence and operation. Since they can be printed on merchandise, product packaging, and other promotional materials, they also are very useful to use in marketing activities.”
As QR codes support multimedia data, offer better security, and allow enhanced tracking, they naturally have several versatile uses, as compared to barcodes more straightforward use. However, this doesn’t mean that they are suitable for all businesses and industries. Let us take a closer look at how barcodes and QR codes differ from each other on a fundamental level.
Barcodes vs QR codes
How are they different?
Appearance is not the only thing that differentiates barcodes and QR codes. We’ve established that a barcode stores data only in the horizontal direction, whereas a QR code holds it both horizontally and vertically.
In practice what this means is that QR codes can contain much more information than barcodes. To put things in context, barcodes can usually store up to 25 characters of information, whereas a typical QR code can store over 2500 alpha and numeric characters.
That’s why barcodes are used to tag a particular type or category of product, and not the individual product itself. For this reason, while checking out multiple pieces of the same product at a grocery store, the cashier simply scans the same items as many times, as opposed to doing them all individually. On the other hand, QR codes are more specific and denote the actual individual item within inventory.
The main area QR codes outperform barcodes is design. Not only are they compact, but they are also customizable to be able to include a company logo, images, text prompts, and different colours. Barcodes usually do not have that versatility (although there are some manufacturers are finding ways to use them more creatively, it is not the norm.)
When comparing QR codes to barcodes, the former tends to be more easily accessible and has lower rates of error. It is worth noting – that since QR codes have a higher rate of customers interaction, the quality of experience is heavily reliant on the sophistication of the code reading device.
“Small and big retail, healthcare, transport, and manufacturing companies tend to use barcodes extensively. QR codes are used more for digital payments, placing orders, and customer engagement.”
In summary barcodes continue to be a business-focused technology that can help streamline inventory and product management, whereas QR codes are predominantly a consumer-centric tool used for a contactless exchange of data.
Barcodes vs. QR codes
How to choose the right one
It might be confusing for businesses to choose between QR codes and barcodes, as they come with distinct uses and benefits. Here are a few considerations that help make this decision easier.
Functionality: Probably, the most vital factor in the decision-making process is the purpose of the scannable code.
- Is it to manage inventory or simplify the checkout process?
- Do you want to add a contactless payment option for customers?
- Who will be using the system the most and for what duration?
The answers to these questions will determine the appropriate choice between using QR codes or barcodes.
What’s your Industry?
Your business and the industry you operate in also influence your choice. Consult other business owners and managers about their practices and if possible, get vendor recommendations. This ensures consistency with set industry norms and enables your B2B operations to exist within the same ecosystem as that of other businesses.
Scanning equipment
Find out what sort of scanning and printing equipment suits your requirement before making your final decision. A dedicated barcode scanner and printer might be the best option for small businesses, as creating QR codes online for each product might be a cumbersome and labour-intensive job.
Scanning surfaces
An often overlooked but critical question is, where will the labels containing the codes be put? QR codes work best on clear and flat surfaces and might not be readable on curved surfaces. Whereas barcodes can be used on a variety of surfaces and textures as their readability is less impacted by curvature than QR codes are.
Right or Wrong?
There is no wrong choice between barcodes and QR codes, as really depends what part of your business process you are focusing on. If your objective is simply to manage products with quicker identification and database management, barcodes are naturally the right choice. However, if you want to add additional information for your end-use customer, QR codes are a superior option.
Barcodes and QR codes
How to get started and best practices
A robust product and supply chain management process can save your company significant costs, by improving efficiency, productivity, and use of labour. However, setting up the process correctly is essential to ensure you will reap the benefits. Here is some advice on how to go about it:
Barcodes
The first step is to identify the best product suite to suit your needs.
- Take into consideration your budget and weigh it against the expected performance of the system you need.
- Make enquiries and look for free demonstrations. You can consult local POS (point of sale) experts and barcoding solutions providers for their recommendations.
- Depending on your required features, compare different vendors to find the top barcode printers and scanners in your location.
- Systems can be made in-person at physical stores or online (where discounts and promotions are more often offered).
Remember, for the best performance barcodes require low contrast, adequate quiet zones and the right distance and angle. It’s important to make sure all these are accounted for during installation.
Be sure to verify the size of the labels, the compatibility of the scanning devices, and the design of the barcodes before you make your purchase. It is highly advisable to choose high-quality accessories such as label sticker rolls and printing ink, to ensure long-lasting barcodes that are less likely to fade or degrade over time.
QR codes
Questions to ask and information to consider to choosing and set-up your QR Code system, include:
- Take into consideration your budget and staff availability to manage the system.
- Machines that generate bulk QR codes are readily available online
- Higher-end QR code generators allow you to place your company logo or change the colour to your preference.
- It is essential to make sure that the QR code is tested extensively before putting it to use, and that the scanning device works seamlessly.
- You can also invest in tracking and analytical tools to understand how customers interacted with your code. This is essential component to include in your system if you are using your QR code as a marketing tool
Barcodes vs. QR Codes
The Final Note
Both barcodes and QR codes are fantastic solutions to replace manual inventory and retail management systems. They are both helpful in improving the speed and reducing the error rate of tracking items and your choice between the two must be based on your unique business requirements.
If you’re just beginning to introduce scannable codes to your business and want to deploy them for an internal purpose, barcodes are your best choice. But if you’re looking for a more flexible and customer-oriented solution, that can be used for multiple purposes, QR codes are unbeatable.
If you would like additional advice on making the decision between barcodes and QR contacts us via our online form. [hyperlink to contact page]