BEHIND BARS: Get What You Need from Barcoding Technology

North Americans tend to believe that the newer the technology, the better it is. But that may not always be true. Just ask David Shapiro.

Shapiro, director of marketing for Barcoding Inc., Baltimore, Md., knows that the newest isn’t always the best. “You need to assess the needs of your company, and then consider how to best address those needs,” he says.

Today barcoding technology is nothing new, and yet its use hasn’t diminished. In fact, barcoding equipment suppliers are consistently finding new ways to stay competitive in a technologically advanced market. But how can you decide what’s best for your company?

STEP 1: Know the industry

Making educated decisions about barcodes and equipment requires an understanding of how your industry works. “Our technology can help streamline business operations and data collection operations through Automated Identification and Data Collection (AIDC),” Shapiro explains. “Barcoding can provide inventory control, asset management, route accounting, etc.”

While most people are familiar with barcode scanners in the retail industry, material handling and warehousing operations have already benefited from the technology to some degree. Now, with the continuous development of e-commerce and Internet sales, companies are finding it increasingly important to operate in real time. Today’s customers expect interactive relationships with a retailer (even via Internet), so a retailer’s warehousing, shipping and receiving operations must be able to fulfill customer demands. That’s where barcoding comes in. “When you need information in real time, there’s just no other substitute,” Shapiro says.

STEP 2: Know your needs

According to Shapiro, his company offers consultation services that help to assess the needs of individual companies; then designs programs that best fit their needs. Those needs are usually addressed in one of two ways.

Wireless technology has become increasingly popular in the barcoding arena. This is best used for businesses that require real-time applications. To track data such as receipt of goods, verification of cartons shipped or pallet placement in storage racks, employees use hand-held devices called scanners that are somewhat like Palm Pilots. That data is transferred to a company information network immediately, and the hand-held device continues to receive information and record updates throughout the day.

Batch reporting is another common option. While it’s less expensive, it still allows mobility. It does not operate in real time. Instead, data is collected over a period of time and downloaded into a cradle at the end of the day. The information is then electronically placed in a spreadsheet for your records or downloaded into an information system.

Shapiro cites one Washington, D.C., company as an example. It used the batch system to track and complete an ongoing longterm project that involved the washing of all windows at Reagan National Airport. By barcoding all windows, the employees could simply scan each window as it was washed and track which windows were cleaned each day. The information was downloaded at the end of the day, and a report sent to the airport authorities.

“Real time isn’t always necessary,” says Shapiro. “In this case, the company and airport simply needed to know the work was getting done each day, so batch reporting worked. But when you’re working in an interactive environment like the Internet, wireless reporting may be necessary to meet customer demands.”

While real-time and batch reporting are just two different types of barcoding technology, other related equipment is also available for barcoding integration. One example is a Vehicle Mount Computer, or VMC. This hardware unit with barcode scanner ports is attached to lift trucks, and it operates in real time.

Self-contained hand-held devices, which now run with software comparable to PCs, are also increasingly popular. Although such technology can be daunting for those who are not technologically savvy, Shapiro maintains the PC-like nature of the software makes most users comfortable in a short time.

STEP 3: Plan for investment

No one said technology comes cheap, but Shapiro insists that the return on investment is fairly rapid. “An average company can earn the money back within a six- to 12- month period,” he notes. “Often, if a company wants to invest $100,000 into a system, it will score two to three times that amount in savings due to the improved efficiency.”

While it is difficult to pinpoint exact costs of barcoding systems, most companies spend anywhere between $10,000 and $100,000. According to Shapiro, the average Barcoding Inc. customer spends roughly $25,000 to $50,000.

He insists it’s worth the investment. “Depending on the size of the company and the type of purchase made, we shoot for no longer than three to five years to achieve two to five times return on the original amount,” Shapiro says.

Increased efficiency and accuracy are what bring the quick ROI. “Improved efficiency leads to better customer service and lower operational costs. Both improve a company’s profit margin,” Shapiro comments. “For example, human error in data entry can be almost completely eliminated after implementing a barcoding system. You save the time it used to take to track and correct those errors. With barcoding, data integrity is preserved because computer error is statistically insignificant.”

STEP 4: Select Your Service Provider Carefully

When in the market to purchase barcoding technology, Shapiro suggests a number of considerations, including:
• What do you hope to improve by implementing the system?
• What services does the provider offer that meets your needs?
• Is the provider a certified manufacturer or dealer of this type of technology?
• Does the company offer a variety of services that keeps you from having to shop around for support?

STEP 5: Look to the future

While Shapiro insists that barcoding technology has secured a place in our technological future, he admits there are new developments that may change the industry as we know it.

Radio Frequency Identification (RFID) has been around for some time, but its application in most material handling is still new. RFID works as a chip embedded in a tag on a carton or pallet, and “gateways” (like metal detectors) read the tags to track their movement. While he has heard predictions that RFID will replace barcoding, Shapiro believes this is unlikely.
“Because it’s relatively new, it’s still too costly for practical use,” he says. “There is much work to be done in this area, including the development of global standards for RFID use.” Shapiro predicts, however, that RFID and barcoding will, one day, be combined to maximize the best features of both.

Reprinted with permission from Material Handling Solutions and Cat Lift Trucks. Copyright © 2006 by MCFA

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