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From Barcodes to QR Codes and RFID: How moving away from UPC can help retailers & customers

  • Abhishek Shukla
  • Jul 01, 2023
  • RFID
Barcodes to QR Codes and RFID

For decades, the UPC (Universal Product Code) has been in use, uniquely identifying trade item via a 12 digit code. It was ground-breaking when it was first used (in different form than UPC) in rail road business in 1960s in UK (first developed by Woodland and Silver) and was still ground breaking when it was used to identify railroad cars (by MIT grad David Jarrett Collins) in USA. The UPC, the verticals lines as we know as barcodes today, was developed by IBM engineer George J Laurer, 1972-73, and IBM was the first company to supply scanning equipment's to supermarkets. It is quite an interesting story how barcodes have come to be this way, adopted by many industries in various forms. 

Barcodes are preprinted on grocery items except fresh items to identify the product simply by scanning the barcode and same goes for every other item. It was a good system and it worked.

But now we have 2D barcodes, better known as QR Codes (QUICK RESPONSIVE CODES) that are capable of storing unique identification codes for products and more. More information on products, no matter the category, is the need of the hour and use of QR codes on product packages effectively solves the problem. 

Proposed by GS1, as GS1 Sunrise 2027 initiative, QR code is now to be adopted replacing the barcode, benefiting customers and businesses alike.

QR Codes, Customers and Retailers 

Move over barcodes, QR codes are here. 

With the capacity to store 350 times more data than a traditional barcode, QR codes offer the perfect blend of technological advancement able to replace UPC barcodes and the need to offer customers more information about the product they want to buy in a retail store. 

QR codes are a square shape barcode images with white and black dots (inspired by the Go board game, developed by Masahiro Hara, 1994). It can store data vertically and horizontally and can be scanned pretty quickly using a smartphone, hence the name Quick Response code.

You’d be surprised to know that QR codes have been around some 30 years now and it was only in 2017, when smartphone and computer manufacturing firm APPLE INC. integrated the QR scanning feature in its iPhone line up, that QR code use became prevalent. Apart from that, smartphone penetration across globe and pandemic pushed the adoption of QR codes to a new height, encompassing many kinds of businesses such as advertising and marketing, digital payments, hospitality, restaurants, healthcare, education and not to mention retail and supply chain.

QR Code has a clear advantage over traditional barcode. It can store image, text, URL, phone numbers, SMS, Email, address, PDF, Google Form etc. as data and can provide all the information a customer needs, one just needs to whip out a smartphone and point the camera. This increases the customer experience in a grocery store significantly as customers can just scan the product label and know everything they need to know. If a customer picks up a wine bottle, one can know the history of the wine and the vineyard, cocktail recipes, and possible side effects if any. 

RFID and Retailers

While we discuss 2D barcodes replacing UPC, we can’t ignore one technology at the forefront of automatic identification and data capture namely RFID. Radio Frequency Identification is also a very popular and sophisticatedly old technology (WW2 era) and the fact that it is a wireless technology, enabling data transmission using radio frequency signals, makes it more appealing than barcodes. You don’t even need a clear line of sight to read an RFID tag, unlike barcodes. 

RFID, which first made wave in retail some twenty years ago, had a slow adoption as retailers didn’t know what to do with its data capabilities. The implementation cost was also a big hurdle, one tag costing 50 cents that add up to millions of dollars when implemented at a large scale, effectively a huge investment back in the day. The retail giant Walmart even experimented with the technology, adopting RFID back in the day (2007). It made it mandatory for some of its suppliers to tag packages with RFID tags, making it easier for Walmart to manage inventory.

Fast forward to present day, when RFID tag prices, especially passive UHF RFID tags, have come down to 4-5 cents from 40-50 cents, Walmart has again (September, 2022) issued an RFID mandate to its suppliers in home, electronics, entertainment and toys section to implement RFID tags on supply packages.

Apart from Walmart, Macy’s, Target, Zara, and H&M are some of the popular retailers that are using RFID to strengthen their supply chain across the retail stores spread over many countries. 

With the advancement in Chipless RFID, bringing the RFID tag prices to 1 cent and lower, it can be the perfect replacement for UPC barcodes.

QR Codes, RFID, and Retail

With chipless RFID being a reality, RFID technology is looking to replace barcodes for good and rightly so. It offers better identification, wireless scanning and tracking. QR codes will not only replace UPC barcodes in retail but also offer more information to customers about a particular product, its history, the story behind the product, manufacturing details, expiration dates, ingredients and side effects if any. Both are tempting option to go far but when it comes to QR codes, it has the lowest implementation cost, just like UPC barcodes. Probably one of the main reasons why barcodes became this universal thing. So, when you think about it, RFID offers better inventory management for sure, but QR code seems more logical decision when it comes to FMCG (Fast Moving Consumer Goods).

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  • Created on Jul 01, 2023
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