We understand that barcoding is about pictorially displaying information with other key data points linked to it. This is the basis of barcoding and though simplistic in its concept, it can be a very powerful tool for the distribution industry. However, a barcode is nothing on its own and must be incorporated with a good software system which compliments its uses. Let us explore the areas in distribution process in which barcode technology is helpful.
At the point of receiving goods on-site, if a barcode is attached, it is possible to check the delivery against the order and update current inventory levels to include the receipted stock. In the absence of barcode technology, this must be done manually which takes time and is prone to human error.
It is so easy to let a warehouse become messy, which invariably causes frustration when things cannot be located, and can ultimately even result in loss of income through additional purchases to account for ‘lost’ inventory. With barcoding, one can assign a barcode to items as well as storage bins and locations and scan both when the item is put away. The two correct barcodes can be linked so that if an item is put away incorrectly, then the system can detect this and alert the user before the error is exacerbated, creating a real storage nightmare.
Assigning product to orders and sending shipments
When an order is placed and inventory is selected from the warehouse to fulfil it, the barcode of both the item and its location can be scanned to ascertain that the correct product is selected for the correct order. The system can automatically detect if the incorrect item is selected, ensuring that only correct orders are actually sent to customers which saves face, time and money. Likewise, barcoding can be used to verify the correct shipment is being sent to the correct customer by the correct freight-forwarder. Just as with incorrect order fulfilment, if an incorrect shipment is sent out, the company risks their reputation and losing time and money which can be costly.
Accuracy in inventory stock control
In the absence of barcodes, accurate inventory stock control relies on good methods for receipting, storing, picking and packing inventory that must be stuck to religiously. Additionally, stock-take counts must be conducted regularly and accurately which can be tedious and lengthy in nature. Even with every best practice being adhered to, mistakes are still common. However, with barcoding, accurate inventory stock control is vastly more achievable and in significantly less time. As long as barcodes are scanned correctly at each step, the overall control is quick and painless, and when an error does occur, it is a lot easier to identify where in the chain it happened and correct it accordingly.
Saves time and man-power
Scanning a barcode is a lot easier and more efficient than recording a string of numbers multiple times, at multiple locations. Additionally when an error does become apparent, it is quick an easy to trace it and rectify it without needing ‘all hands on deck’ to sort through a large amount of inventory.
Results in increased accuracy
By doing away with human recording, a company does away with the opportunity for human error to creep in. There is a still error associated with barcoding, however it is far less common. Barcoding provides a standard platform of information recording, making it accurate, reproducible and extremely traceable. These all allow for good inventory stock control.
Promotes good organisation, efficient use of product and easy scalability
As we have mentioned, using barcoding for the storage of items is a way of maintaining accurate and organised storage. This is because barcoding makes it very easy, with a simple scan of a product’s barcode and that of the bin in which it sits, to ascertain if a product is in the correct place.
In conjunction with a good inventory management software system, barcoding makes it possible to assign products to use according to their receipt and expiry dates. This helps ensure that the product adheres to the company’s chosen inventory system. And finally, if the company’s sales and subsequent inventory and storage needs increase dramatically, the system can easily be scaled up with minimal fuss. On the contrary, if a paper-based system was still in use, such scale-ups can prove to be very difficult and can require a lot of time to sort out.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.