Introduction To Barcoding

What is a Barcode?

The Barcode (or bar code) is one of the most widely used automatic identification technologies. Barcoding automatically enters information into computer systems to enhance control over products, materials, paperwork and personnel through applications in inventory, work in progress, tracking, and cost accounting. Barcodes themselves are a machine-readable pattern of alternating parallel bars and spaces representing numbers and other characters. They can represent a product ID number, an order number, or any other information that must be entered into a computer system. There are many reasons to use Barcode scanning instead of manual data entry. Some benefits include:

  • 20 times faster than typing.

  • Less than one error per 1 million characters.

  • Increases productivity by up to 50%.

  • Reduces material handling costs by 20-70%.

  • Quick Return on Investment: Most Barcode systems pay for themselves in 6 to 12 months.


A Short History of Barcodes

The official birthday of the barcode is Oct 7, 1952, making it over 60 years old. This was the date US patent 2,612,994 was granted to Norman Silver and Bernard Woodward.

While the patent was granted in 1952, it was not until June 26, 1974 that the first bar code on a pack of Wrigley’s gum was scanned at a grocery store. This happened at Marsh's Supermarket in Troy, Ohio near an NCR factory where the first scanners were being developed. The pack of gum and the receipt are now on display at the Smithsonian Institution.

Today we can’t imagine how civilization, at least in North America, would function without a barcode. It’s so intertwined into our lives that few people, if any, notice them anymore. However, when they can’t be scanned or they’re not found on a product, you suddenly realize how they keep our lives moving at the pace we’ve grown accustomed to.


The Uses of Barcodes

Because Barcodes are machine-readable symbols, they can be used wherever preprinted information needs to be entered into a computer or microprocessor-based system. Some common uses of Barcodes are:

  • Materials Handling  

  • Monitoring work in progress  

  • Point of sale  

  • Assembly verification  

  • Order Entry  

  • Controlling access to secured areas  

  • Shipping and Receiving  

  • Library Circulation  

  • File Folder/Document Tracking  

  • Hospitals/Health Industry  

  • Charge Collection

  • Requisitions  

  • Inventory Control  

  • Blood Banks  

  • Dispensing of Medications  

  • Patient Records  

  • Equipment Rentals

  • Military/Government Applications  

  • Airline Baggage Sorting  

  • Ski Lift Tickets  

  • Item Tracking

  • Employee Identification Cards


Parts of a Barcode


Almost all Barcodes contain these elements:

Start and stop characters

These characters are at the beginning and the end of the Barcode symbol. They indicate to the scanner the direction in which the information is being scanned, allowing bi-directional scanning. These characters also define the type of Barcode being scanned and therefore allow autodiscrimination, which enables the more sophisticated scanners to read many symbologies at the same time.

Quiet Zones

Immediately adjacent to the start and stop characters there must be an area that contains no markings at all. These are the quiet zones. This space should be at least 10 times the width of the narrow bar or space. If this distance is too short the scanner may not recognize the code and thus not read the symbol.

Interpretation line

This is the human readable information printed directly beneath the Barcode itself. They are the characters that are encoded in the Barcode symbol. In many cases they are printed in either OCR A or OCR B fonts.

Bar/space pattern

This pattern forms a machine-readable version of the information in the interpretation line. Most Barcode symbologies have simple structures consisting of only wide and narrow elements (bars and spaces).

Intercharacter gap

Some Barcodes, notably Code 3 of 9, are "discrete" in the sense that each character is printed independently of the other characters and separated by a space that is not a part of the encoded character. This space is called the intercharacter gap. However, with "continuous" Barcodes, all the spaces are part of the character and carry necessary information, therefore there is no intercharacter gap.

Code density

Code density refers to the number of characters per inch. There are four variables that affect code density 1) type of code, 2) ratio of wide to narrow elements, 3) the X dimension, and 4) the printing technique:


1) Type of Code

Some Barcode structures encode more information per inch than others do. For example, Interleaved 2 of 5 can encode more numeric information than Code 3 of 9 in the same space.

2) Ratio of Wide to Narrow Elements

This ratio is important when choosing the type of input device to read a code. Varying this ratio can change the code density of a Barcode.

3) X Dimension

The width of the narrow element is referred to as the "X" dimension. This dimension is critical when selecting a printing method for Barcodes. A smaller width of the bar means a shorter length of the symbol and closer tolerances that lead to more difficulty printing. Barcode specifications also define the ratio that must exist between wide and narrow elements (i.e. 2:1, 3:1). Exceptions to the simple wide and narrow patterns are structurally complex codes like the UPC symbol and Code 128, both of which have four different element sizes.

4) Printing Technique

Code density will also be constrained by the type of printing technique being used to produce the symbol. Printing techniques vary the size of the "X" dimension, the wide to narrow ratio and the type of code that can be produced. For instance, a dot matrix printer with a 10 mil pin cannot print bars less than 10 mil thick.


Popular Barcodes

There are three categories of barcodes: one dimensional, two dimensional, and three dimensional or bumpy Barcodes. Following is a list of popular codes in each of these categories and a brief description of their characteristics:

One Dimensional or 1D Barcodes


1D Barcodes are the most popular and least costly Barcodes to produce and scan. They’re the ones you see on products at a consumer level. Here are the ones in use today:

Code 39 (3 of 9)


Code 39 was the first symbology developed for alphanumeric use. It’s one of the most popular Barcodes used in the non-retail environment.

Every Code 39 character has five bars and four spaces. Of these nine elements, three are wide and six are narrow, making Code 39 a two width code. Code 39 begins and ends with an asterisk (*) that’s used as the start and stop character.

Code 39 consists of only 43 characters, but it is possible to encode all 128 Full ASCII characters using Code 39's Full ASCII feature. If a reader is enabled for full ASCII, the symbols $  /  %  and + are used as precedence codes with the 26 letters of the alphabet.

Interleaved 2 of 5


Interleaved 2 of 5 (I 2 of 5) has been adopted as the shipping container symbol (SCS) for use by the warehouse and distribution industry. It’s a high density, self-checking, continuous, fixed length code.

Every I 2 of 5 character actually encodes two digits: one in bars and one in spaces. There are five bars (two wide and three narrow) and five spaces (two wide and three narrow) in each character. Each digit has its own unique 2 of 5 arrangement.

A complete I 2 of 5 symbol consists of the start character (two narrow bars and two narrow spaces), the data characters, and the stop character (one wide bar, a narrow space, and a narrow bar).



Originally developed in 1972, Codabar is commonly used in libraries, blood banks and parcel express applications. It’s a self-checking, discrete symbology containing 16 characters in its set (numbers 0 through 9 and characters $ : / . + ,) and four unique start/stop codes (a, b, c, d).

This symbol uses a series of wide and narrow elements to represent each character. These wide and narrow elements can be either a bar or a space.

Code 128


Code 128 is a Barcode symbol capable of encoding the full ASCII 128 character set. This symbol is revolutionary in its ability to encode characters using fewer code elements per character, resulting in a more compact code. It features unique start and stop characters for bi-directional and variable length decoding, both bar and space character parity and a check character for symbol integrity.

Each Code 128 character is comprised of three bars and three spaces, each bar or space containing one to four elements.



UPC (Universal Product Code) is often used by the grocery industry for scanning items at the checkout counter. UPC is a fixed length, numeric, continuous symbology using four element widths. Two common types of UPC are Version A, which encodes 12 digits, and Version E, which encodes 6 digits.

A UPC A symbol is arranged into halves. The first six digits and the second six digits are separated by centre guard bars. The two symbol halves are then enclosed by two left guard bars and two right guard bars. These guard bars can be thought of as start/stop patterns.

UPC E encodes six digits and is suited for identifying products in small packages. The six digits are enclosed between two left-hand guard bars and three right-hand guard bars.

The European Article Numbering system (EAN) is a superset of UPC. An EAN scanner can decode UPC, but a UPC scanner cannot usually decode EAN. EAN has two versions: EAN 13, which encodes 13 digits, and EAN 8, which encodes 8 digits. UPC and EAN have proven to be extremely successful in the retail environment.

MSI Plessey


The primary application for the MSI Plessey code is marking retail shelves and subsequent scanning with portable devices for inventory purposes.  

MSI Plessey is derived from Plessey code and consists of four bars and four adjacent spaces. Each bar/space pair consists of one information bit. A zero bit consists of a narrow bar followed by a wide space, while one bit consists of a wide bar followed by a narrow bar. The zero bit is one unit bar followed by a two unit space and the one bit is a two unit bar followed by a one unit space.

Code 49 & 16K


Code 49 was introduced in late 1987 as a symbology for labeling small objects. Code 49 contains anywhere from two to eight adjacent rows, each separated by a one module separator bar. The number of rows used depends on the amount of data and the compression possible.

These parallel rows of data include start and stop characters and information indicating the row number. Code 49's rows can be scanned in any order. A "good read" beep is not sounded until all of the rows have been read, but a click is sounded whenever a new row is scanned.

Code 16K is similar to code 49 in that it employs multiple rows (from 2 to 16). Each row is fixed in length and employs a "mirror image" of the Code 128 encodation patterns.

Although Code 49 and 16K allow for printing of high density Barcodes, not many scanner manufacturers decode these codes, making choice of scanners quite limited. This should be a consideration prior to selecting these codes.

Two Dimensional or 2D Barcodes

These Barcodes can contain more information than their linear counterparts.  

PDF417: This compact symbol can support as much as 2,700 data characters in a single barcode, which is why PDF stands for “Portable Data File”. Created by Symbol Technologies, this symbol can encode the entire ASCII dataset of 256 characters. The automotive industry has embraced the PDF417 and it is also commonly used on shipping labels containing information such as purchase order #, part #, and lot # - up to 985 words per symbol. You can also embed a picture.

Data Matrix

Data Matrix is a 2D matrix style bar code symbology that can encode up to 3,116 characters from the entire 256 byte ASCII character set. The symbol is built on a square grid arranged with a finder pattern around the perimeter of the bar code symbol. The newest version of Data Matrix is called ECC 200 and is recommended for all new Data Matrix applications. The ECC 200 version of Data Matrix uses a much more efficient algorithm for encoding data in a symbol as well as an advanced error checking and correction scheme.

QR Codes

QR (quick response) codes are driving the consumerization of the barcode. This is the symbology you typically see in bus shelters, magazine advertisements, and coupons. Scanning this code with your Smartphone will give you further information on the product or service by directing you to a website or landing page.

These 2D barcodes can also be used with social media hubs to perform an automated Facebook Like or Twitter Follow.  

The ISO/IEC 18004 specifications state that up to 2,900 bytes and 4,200 ASCII characters may be encoded in a single symbol. However, few imagers can dependably decode symbols that large. Thus it is recommended that you limit the amount of data encoded in each symbol to 800 characters or less.  

Three Dimensional or 3D Barcodes

DPM (direct parts marking) is a process in which a 1D or 2D barcode is engraved or etched into a material. One common process is Dot Peen marking, which creates each symbol out of a string of dots. DPM is used for life cycle management where the barcode is permanently marked on the product. Typical applications include marking of automotive and aerospace parts. The main driver of DPM is the reliable identification of parts. This can assist in data logging for safety, warranty issues and satisfying regulatory requirements. The end result is a “3D barcode” that is raised above the surface of the part and has a bumpy feel to it.

Barcode Scanners

How a Barcode Scanner Works:

Scanners contain both a light source and a light detector. The scanner focuses a spot of light on the symbol that is either reflected by the spaces or absorbed by the bars. The light detector responds to the reflectivity of the bars and spaces and, through hardware and software logic, determines if the pattern represents a valid Barcode. If it does, the symbol is decoded.

Carbon black bars on a white background provide the best contrast for the scanner to differentiate between the bars and spaces. It’s not possible to visually determine if the proper contrast exists. For example, due to the nature of the technology in some scanners, red bars on a white background do not provide any contrast at all for the scanner. Industry and government specifications have established standards for the reflectivity of the substrate and the bars. In addition, a measurement called The Print Contrast Signal (PCS) is also specified.

Types of Scanners Available

Barcode decoders are built in a variety of different configurations: hand held portable devices for collecting data in remote locations to be "dumped" into a database at a later time; fixed station decoders for attaching to computers, microcomputers, terminals and POS registers; and scanners with integrated decoders that can be linked to a PC-based system or mainframe.

Fixed Station Scanning

"On-line" scanners are fixed to a specific terminal or computer and draw power from either the terminal or a power pack. There are several types of fixed station scanners. They’re categorized by the port or interface to which they connect.

A keyboard interface decoder connects or "wedges" between the keyboard and terminal. These decoders emulate keyboard data and are transparent to the data collection software. Other interfaces include Bluetooth, Parallel, Ethernet, OCIA, and RS232 ports.  

Adding fixed station scanners to an existing data collection system only requires that the terminal or PC accept data from the communications port (ASCII, parallel, OCIA data) or keyboard data. Barcode scanners can be programmed for preambles, postambles, and communications options (RS232 parameters) to make interfacing with an existing system quite simple.

The fixed station scanners can operate in a standalone mode or interact online with a host device while performing real time data collection. Barcode scanners mounted on shop floor work stations or assembly areas throughout the plant can be used to perform work in process monitoring. For example, a barcode label identifying each lot # is attached to a container. As the material is processed through each work station, the code is read and the process results transmitted to a server. Real time production information insures that orders are delivered on time and that the product has been subjected to a thorough inspection.  

Handheld Portable Computers

Handheld Portables are in essence a ruggedized version of a PC. The typical unit runs Microsoft Windows Mobile has a built-in scanner or imager, WiFi, GPS, camera, audio jack, and Bluetooth radio. These units can be configured and programmed to perform a variety of functions as required by the mobile worker.  Scanned or keyed in data can be transmitted either in real time or in batch.   

Another category of portables are Smartphones. As these devices gain in features and processing power we’re seeing a crossover of these devices into commercial applications. Where in the past Microsoft and Intel based devices were dominant, it’s increasingly common to see consumer based Android devices, iPhones and Blackberries being used by mobile workers in a variety of tasks such as proof of delivery, work orders, and order entry.   

Irrespective of the device type, a "downloaded" program can give the operator directives that facilitate activities such as order picking. By following the computer directives, an operator would proceed to the location displayed on the unit, use the barcode wand to scan the shelf tab item code, enter a quantity from a menu tablet, and proceed to the next picking location. At the end of the picking cycle, the gathered data is transmitted to the main computer where inventory counts are updated and purchase orders are issued to replenish stock.

Handheld portables typically have integrated laser scanners or imagers which can read 1D or 2D barcodes. Other options include a qwerty or numeric keyboard and ½ VGA display. Portable units are powered by rechargeable or disposable batteries. Data is stored in a solid state memory for later transmission by either a direct wireless connection or through a serial or Ethernet connected cradle.

Conveyor Line Scanning

Fixed station scanners are also found on conveyor lines where they are used to scan product or items. They become the ‘eyes’ of the line and are typically connected to a PLC (programmable logic controller) which then diverts the products to the correct area. A very typical application would include baggage handling systems in airports or scanning of food products coming off a high speed line. There is a fixed scanning solution for virtually any type of conveyor line and as such fixed mount scanners have scan rates exceeding 500 scans per second.  

Charged Coupled Device

An older technology but still used today. The Charged Coupled Devices (CCD's) do not require the user to move the scanner across the code, however, they must come in contact, or within one inch of the code. CCD's use an LED light source and are limited to a specific field width making some codes unreadable.

How To Verify That Barcodes Are Scannable

It is impossible from visual inspection to ascertain if a Barcode is scannable. There are two methods being used to check Barcodes. The first is to purchase a commercially available scanner and simply scan the symbol. This provides a relatively inexpensive way to verify the Barcode in question.

However, as the scanner is of a fixed density it may not match the density of every Barcode being produced. Another problem with the scanner approach is that if a particular symbol will not scan the reason cannot be defined. No feedback is provided to indicate if the Print Contrast Signal (PCS) is out of spec., a character is encoded incorrectly, or the symbol is out of tolerance. The second method employs a verifier/analyzer that actually measures the bars, the spaces and the PCS, and tells you whether or not they meet the specifications.

The verifier makes no assumptions about the type of scanner being used  if the Barcode is printed within specifications the scanner must be able to read it. It is recommended that a verifier/analyzer be used when it is required to supply Barcodes to one of the regulated industries.

Wireless Networks:

While it is common to have a wireless network in your home or office, surprisingly only 20% of warehouses today have a wireless network. That only 20% of warehouses are efficient suggests a connection between real time communications and productivity.   

Wireless networking offers users flexibility and more importantly, real-time data updates of transactions entered into a handheld portable computer.  Wireless LAN (Local Area Network) products have been integrated into retail stores, warehouses and manufacturing plants where salespeople or workers roam around with hand held or portable terminals that permit data entry and maintain a network connection.

What does Wireless LAN mean?

The term “wireless LAN” is a little bit of a misnomer.  In the majority of cases wireless LANs do not replace wired LANs but are used to create a wireless extension to wired LANs.  Wireless LANs have significantly less bandwidth than wired LANs and for this reason should not be considered to be a wired LAN replacement.

What are the methods of radio communications for commercial use? There are two general categories:

1.    Narrow Band radio UHF

2.    WiFi or 802.11 wireless networks

UHF systems have been around for over 30 years and were the first wireless product available for industrial use.  UHF bandwidth ranges from 407 to 470 MHz.  Due to their great range (up to 1 million square feet) users are assigned a specific frequency by Industry Canada to avoid interference.  This assignment is in the form of an annual license that grants the user exclusive use of a particular frequency in that area.  All licenses are conditional upon the UHF system no causing interference with surrounding licenses.  Although UHF has a long range, the transmission speeds are in the range of 9600 bits per second to 19.2 K bits per second. Many shipping ports still use this technology for its reliability and freedom from interference.  

WiFi or IEEE 802.11a/b/g systems, on the other hand, occupy the ISM (industrial, scientific, medical) bandwidth of 2.4, 3.6, and 5.4 GHz and is a series of standards set by the Institute of Electrical and Electronic Engineers based out of Switzerland.  This is a range of frequencies set aside for general use by both private and public industry.  As a result, these systems do not require a license.  WiFi is designed to avoid destructive interference from transient or even constant sources in the same environment.  How does this work?  802.11b and 802.11g control their interference and susceptibility to interference by using direct sequence spread spectrum (DSSS) and orthogonal frequency division multi-plexing (OFDM) signaling methods, respectively. 802.11a uses the 5 GHz band, and has up to 23 non-overlapping channels rather than the 2.4 GHz ISM frequency band, where all channels overlap.  


This range uses the 5 GHz radio and is designed to support larger files. The higher transmission speed of up to 24 Mbps also means shorter range as this signal is readily absorbed by walls. For most warehousing and manufacturing applications this setting is rarely used.  


This is the most common use of the 2.4 GHz bandwidth. A radio of under 500 milliwatts is used and offers transmission speeds of up to 11 Mbps bits per second.  Furthermore, additional access points can be combined to increase the total bandwidth (up to 24 Mbps).  Systems using this

frequency have greater immunity from interference and this is confirmed by its use in hospitals.  The limitation however is the smaller range of up to 150,000 square feet and this would translate into using more access points.


This works in the 2.4 GHz band (like 802.11b), but uses the same transmission scheme as 802.11a. Thus it can operate at a maximum  rate of 54 Mbps or about 22 Mbit/s average. 802.11g hardware is fully backwards compatible with 802.11b hardware. Like 802.11b, 802.11g devices suffer interference from other products operating in the 2.4 GHz band, for example wireless keyboards and microwaves.


The newest IEEE wireless standard that was ratified in 2005 and offers speeds up to 100 M bps. For now this technology is found only in access points and not used (yet) in handheld devices. 802.11n is backward compatible with devices using 802.11b/g radios.  

Site Surveys

A proper network setup begins with a wireless site survey. A wireless survey is a process that involves taking a radio frequency profile of your facility to determine if there is any outside interference, number of antennae you’ll need, configuration of your access points, and if any special installation, equipment, or enclosures are needed.  

It will also involve an audit of your current network setup to determine if it is ready to be extended vis-à-vis the new wireless network and what firewalls and security protocols are currently in place.  

Why get one? Consider these factors:

Ceiling heights. Most warehouses are 20’ high and at that height the standard issue antennae won’t do. You’ll need special antennae usually in the 3dB gain range to extend and propagate your RF signal.

Density of your Inventory and Other Equipment. Water absorbs RF signals and metal reflects. Also consider any microwave machinery, wireless equipment, or shrink wrapping equipment these can impend your signal.  

Neighbors, Rogue Networks, etc. It doesn’t happen often but we’ve seen signals from neighboring facilities affect our ability to install a network. One of our clients was next to a military base and they routinely blanketed their area with jamming frequencies rendering it impossible to install a 2.4 GHz based network. At another customer site we found a number of rogue unsecured wireless networks installed by users to support their work. While not apparent to the naked eye, a wireless site survey helps you see these problems before you spend a lot of money on equipment.  

When done by a properly trained professional, you will not only have the confidence of having your facility covered but an exact cost of getting wireless and a guarantee of coverage and redundancy.  

I’ve included a sample of a wireless survey at the end of this document.


The number one question we get asked is how secure are wireless networks? The answer is VERY secure provided it’s set up correctly.

Typically hackers are able to break into a wireless network because there is no security or the network uses the lowest security level in this case WEP which only uses 0-9 and A to F characters for the password.  

Higher security standards are available and include (inorder of increasing security): WEP, WPA, WPA-TPIK, WPA-AES, WPA2-TPIK and WPA2-AES.  

WPA is the standard approved by the IEEE802.11i and addresses the security issues in WEP. However while, it is natural to choose the highest level of encryption in this case WPA2-AES, just be aware that certain devices looking to connect on your network may not support that desired security protocol.  So depending on who needs access and the cost of upgrading their wireless card, you may be left with choosing one of the lesser WPA protocols.  

Top 6 Wireless Security Tips:

1.    Disable SSID broadcasting. This no longer broadcasts the name of your wireless network.

2.    Use WPA2 in conjunction CCMP-AES. This is the highest level of encryption security available today and used by the military and government bodies.

3.    User Authentication. EAP authentication is the latest standard and further adds another control around user identification and confirms access rights to the network.

4.    Change your password and keys frequently just as you do on your wired network.

5.    Create multiple WiFi networks.  By creating multiple wireless VLAN

(virtual local area networks) you can define physical boundaries and identify which users and where they have access to the Wireless LAN.

So consider a Hotspot for visitors to certain areas, a VLAN for warehouse workers, another for office personnel, etc.  

6. PCI Compliance. This standard initiated by the credit card companies for retailers taking credit card numbers. It also has a wireless security standard that in my view is suitable for any business not just retail. It includes a firewall, wireless intrusion protection, regular audits, and rogue detection. Many commercial wireless access points have PCI compliance built into the product at no extra cost – so definitely worth looking into.



The rapid emergence of Radio Frequency Identification (RFID) is likely the most exciting event to happen in our industry over the last five years. Most industry participants were expecting a gradual adoption of this technology, as was the case with wireless, but this changed overnight as both the U.S Department of Defense (DOD) and Wal-Mart issued mandates for their 60,000 plus suppliers to begin using this technology by as early as 2006.

In general terms, RFID (Radio Frequency Identification) is a means of identifying a person or object using a radio frequency transmission. The technology can be used to identify, track, sort or detect a wide variety of objects. Communication takes place between a reader (interrogator) and a transponder (Silicon Chip connected to an antenna) often called a tag.

Tags can either be active (powered by battery) or passive (powered by the reader field), and come in various forms including Smart cards, Tags, Labels, watches and even embedded in mobile phones. The communication frequencies used depends to a large extent on the application, and range from 125KHz to 2.45 GHz. Regulations are imposed by most countries (grouped into 3 Regions) to control emissions and prevent interference with other Industrial, Scientific and Medical equipment (ISM).

Regarding RFID we’re going to focus on two key areas: Compliance and Supply Chain cost reduction.


A. RFID Compliance

The two main standards organizations EPC Global and ISO are responsible for establishing standards for all new generations of RFID tags and readers, RFID needs fall into two categories: those that need to meet the Wal-Mart/DOD requirements and those that are looking to reduce their supply chain costs through the use of this new technology.  

EPC Global has also mandated: what information can be stored on each tag (manufacturer, product, version, and serial number), how many times it can be written (only once), and where the rest of the data such as manufacture date, warranty, ingredients, expiry date, lot#, etc related to the tag can be stored (the EPC network). EPC Global is more than just setting standards for tags.  

One last note, the EPC network is an ambitious futuristic plan to house the world’s inventory data such that it will be a ‘super repository’ for everything you want to known about a specific item.  With both Walmart and the DOD adopting EPC Global’s standards it is likely to become a reality one day.  


Issues with RFID Tags

  • Do not read well through liquids and foil covered products for example food products and liquid detergents
  • A hand over the tag will effectively block transmission
  • Inside cases on a pallet have poor read rates
  • Costly compared to barcoding. Typical costs range from 25 cents to $1. Whereas a barcode label can be produced for a fraction of a penny. This cost difference often makes RFID useful for high value items or closed loop applications like asset tracking.  
  • Standards are evolving. RFID standards is changing yearly which means high obsolescence costs associated with the technology. Thus it is important to pick projects that have a return within a short period of time.  


Tag Anatomy

B. Supply Chain Cost Reduction

The low storage capacities of the above Wal-Mart/DOD approved RFID tags make them less than ideal candidates for sharing data with supply chain partners. A key requirement for enabling supply chain cost savings is the ability to create and share portable databases.  Because supply chain partners typically do not have direct access to manufacturers’ databases any mission critical information to support, say a product recall, must be available in the tag itself.  

We do not recommend the use of the Wal-Mart/DOD RFID tags if any the following circumstances apply to you:

  • Wal-Mart/DOD compliance requirements do not affect your organization
  • In order to effectively support your supply chain partners you need more than 16 characters
  • The ROI of your RFID application is not dependent upon a tag that is less than $1
  • Your application is closed loop; the tags are returned to your organization
  • The information on tags do not need to be shared with other companies
  • Differing frequencies such as 125 KHz, 13.56 MHz or 2.4 GHz which offer different read ranges and ability to work through limitations such as metals or liquids
  • Active versus passive tags that provide farther read distances of up to 300 feet
  • You need permanent tags which can be re-used multiple times and withstand harsh environments

RFID is an emerging standard and technology that holds the promise of collecting and sharing data without human intervention and little effort. The visibility and traceability it provides will one day drive billions in cost out of global supply chains.  However as with any new technology we advocate at least for your first RFID project a modest approach that includes a carefully defined project scope containing several project phases.