Barcodes and Barcode Scanners - Everything You Need to Know

Barcodes and Barcode Scanners - Everything You Need to Know

Barcodes and barcode scanners are a prominent part of modern POS systems. They are powerful tools that help accurately keep track of assets, improving checkout efficiency while also playing a major role in inventory management, improving operations overall. Barcode systems reduce the need of manual efforts and save time overall.

The use of barcodes has increased exponentially over the years, with businesses adapting and adopting barcodes to suit their unique needs. Although initially, barcodes were used primarily by larger businesses offering vast numbers of products, nowadays, businesses of all sizes are using barcodes.

For quick and easy scanning of barcodes, and to maximise their potential, barcode scanners are a necessity. There are a variety of barcode scanners available, based on their portability and performance.

A barcoding system is an excellent way to digitise entire stocks of catalogues, maintain accurate records, track customer orders and much more. Barcodes may seem intimidating at first, but thorough knowledge of barcodes and scanners will help you be able to set up your own barcoding system, or boost the efficiency of an existing setup.

What are Barcodes?

A barcode is a pattern of numbers and lines with different widths that together form a scannable code. The lines and patterns on a barcode are in a parallel form and a single barcode can represent large amounts of data regarding the specific product. There are nearly 100 billion variations of barcodes available, and can be customised as per the needs of the business.

Barcodes act as a pointer for the item and reflect details of the item in the point of sale, inventory or warehouse software. When the barcode is scanned, the software queries the relevant database, bringing up details related to that specific barcode or product the barcode refers to.

The functioning of a barcode is based on symbology, with a scanner being used to read the symbols, identify them and convert them into useful information. This information can include everything from the item’s type, price, origin, and location.

Creating barcodes has become easier than ever, with several free tools available online that can be used to create custom barcodes. Based on the business niche, industry and requirements the barcodes and the information they provide can be customised.

History of Barcodes

In the 1940s as supermarkets became more common, local food chain owners sought out methods to improve the speed of checkouts, thereby increasing profits. A president of a local food chain supermarket contacted the Drexel Institute of Technology in the US state of Pennsylvania to devise a system that would automatically read product details at the time of checkout. From that need was eventually born the modern-day barcode system.

1948: A student of the Drexel Institute Bernard Silver overhears the request for automatically product identification system and with his friend Norman Joseph Woodland began working on systems.

The first potential system Silver and Woodland devise used ultraviolet ink, but was too expensive and the ink faded easily. The next system was a prototype of the barcode system, inspired by the Morse Code.

1949: Silver and Woodland file a patent for barcodes with linear and circular patterns as a ‘Classifying Apparatus and Method’, along with a patent for the electronic and mechanical system that would read the code.

1952: The official patent was issued in the US.

1962: The brand Philco, a pioneer of batteries, radios and television production purchases the patent for barcodes, selling it to the Radio Corporation of America (RCA) soon after.

1966: The National Association of Food Chains (NAFC) conducts a meeting on incorporating the use of automated checkout systems. An internal project is launched by the RCA to develop a system using the circular or bullseye model of barcodes.

1967: The Association of American Railroads implements a similar concept of barcodes developed by David Jarrett Collins to automatically identify railway cars. Reflective red and blue stripes were attached in a pattern to the side of the railway cars to be scanned as a code.

1969: David Jarrett Collins forms the Computer Identics Corporation and expands the application of barcodes, with further improvements on barcode scanners that can also read damaged labels.

1972: The RCA launches an 18-month test of the barcode system at a grocery store in the Ohio state of the US, with barcodes being printed on adhesive paper and attached to products manually by store employees. The bullseye style stated showing problems with ink smudging rendering the barcodes illegible. The linear style of barcodes was implemented as even with ink smudges, the code was still readable.

1937: A Universal Product Code (UPC) concept was launched and grocery manufacturers were directed to include barcodes on the packaging or labels of their products.

1979: In Australia, Sims Supermarkets became the first location to start using barcodes.

1980: As sales started climbing in shops using barcodes, nearly 8,000 new stores per year adopted barcode systems.

1984: By this time, nearly 33 percent of grocery shops were using barcodes and barcode scanners.

1994: Barcodes further evolve into QR codes created by Denso Wave, a subsidiary of Toyota, to track vehicles and associated parts.

1995: Radio Frequency Identification (RFID) is developed, adding on to the safety and capabilities of barcodes.

2004: Nearly 80-90% of the top 500 companies in the US are using some forms of barcodes.

Types of Barcodes

There are two basic types of barcodes currently used in the market, and they are 1D or linear 1-dimension barcodes and matrix codes or 2D 2-dimension barcodes such as QR codes.

1D Barcodes: The most commonly used barcodes are the 1D barcodes which consist of vertical lines with variable widths and gaps in between. The entire image, including the lines and the gaps, represent the final code that a scanner will read. For 1D barcodes, the scanner reads the image horizontally. There are typically 12 digits on 1D barcodes that correspond to UPC numbers. The first 6 digits are the identification number of the manufacturer, followed by 5 digits for the specific product and a final digit used to check if the entire code has been read accurately.

A standard 1D barcode can store up to 8-25 characters of information. By adding additional bars and spaces to the barcode, in a process known as ‘stacking’, the information carrying capacity can be extended further on. Most businesses store 8-15 characters as that results in a barcode with a smaller and more printable size. The characters stored on the barcode will then reflect further details about the product. The more the information stored in a barcode, the more complex the barcode itself becomes.

2D Barcodes: In comparison to 1D barcodes, 2D barcodes are capable of storing a lot more information. Beyond simple characters, a 2D barcode can encode information such as images, website addresses, pricing, voice and other forms of data. The 2D barcode is generally in the form of a square or a rectangle and stores information vertically as well as horizontally. In addition to lines, 2D barcodes encode data using dots, squares, hexagons, and other shapes.

A 2D barcode can store up to 4,000 characters and 7,000 digits of data while still having a small size for scanning. QR codes and data matrix codes are prime examples of 2D barcodes. Even after slight damages to the barcode, the 2D barcode can still be scanned from any angle, and have a 100% readability rate. While 1D barcodes are dependent on having a connected database for full benefits, 2D barcodes can be used independently. The massive amounts of data that 2D barcodes can store has further fuelled their popularity. Also, while 1D barcodes require dedicated scanners, some 2D barcodes can be scanned from smartphones as well.

Benefits of Barcodes

There are substantial benefits of using barcodes, as they support effective inventory management, asset management, and customer tracking.

  • Inventory management: With barcodes, you can easily store all the information regarding available products in a digital manner. All that is required is to set up a barcode for each product. Even if the products are stored in multiple locations, with a barcode setup all the details are at the tip of your fingers. Monitoring existing stock and sales are simplified by bringing all the details and data to one interface.
  • Automation: When dealing with large volumes of products or items, automation is a boon for smooth operations. Barcodes are excellent management tools for automation, as they can help you keep track of shipping and status of products.
  • Sales Analytics: Barcodes on products help you identify and analyse which products are being sold the most and at which frequencies. This information is useful in planning out further sales strategies.
  • Improved speed: The original motivation behind the development of barcodes – speeding up checkouts is equally relevant decades later. Barcodes on your products make checkouts fast and convenient, helping boost overall sales. Many businesses are also experimenting with self-checkout counters, which are heavily dependent on barcodes.

Applications of Barcodes

The immense versatility of barcodes and scanners have resulted in a diverse range of applications. They have become a vital part of nearly all POS systems. Barcode systems are applicable across numerous industries and as they are extensively customisable, the potential is unlimited. Here are some of the broad applications of barcodes:

  • Grocery: The first industry to use barcodes, supermarkets and grocery sellers are some of the biggest users of barcodes. All products and produce can be marked with barcodes, thereby supporting fast checkouts and instant inventory management.
  • Retail: Apart from groceries, purchase of any item is made easier with barcodes. The barcodes can show the name brand, type, size and other details of products.
  • Ticketing: Admission tickets for events, plays, movies, even travelling tickets now use barcodes. With barcodes, sales performance can be better tracked, and entry is faster and more efficient.
  • Food processing: Organisation and management are important aspects of food processing, including during the manufacturing, packaging and distribution. Barcodes can effectively track dates, and when and where the produce was processed. Other useful details include on who receives the produce, where it is stored, transportation details, and consumption and disposal information.
  • Manufacturing: In the manufacturing of any product, barcodes can be used to detail the inventory, work details, shipments, source of shipment, destination and more.
  • Warehouse distribution: Warehouses tend to deal with large volumes of products, and barcodes help in keeping operations smooth and organised. Barcodes can indicate sources, destinations, stock replenishment, and shipments.
  • Transportation and logistics: Regardless of the type of product, transportation and logistics is important to support a functional supply chain. With barcodes, it is possible to track each product and its movement, including the pick-ups, deliveries, fleet management and cross docking.
  • Health care: Hospitals, medical centres, and doctors’ offices deal with large numbers of patients and treatments, and their accompanying paperwork. Any mistake on patient data can have deadly results. Barcodes can be used to keep track of patients, admissions, treatments, medical specimens, and past medical records, aiding the staff in offering accurate and prompt healthcare.
  • Postal and delivery services: A postal or delivery service provider often deals with bulk incoming packages, parcels, and letters. Using barcodes on the packages and delivery items helps in tracking packages and in monitoring the delivery process, ensuring that the correct packages reach the desired destination.
  • eCommerce: An eCommerce setup typically involves product management, order management and shipping. Barcodes are helpful on each step of the order fulfillment process, from helping with inventory management, to allocating the shipping details.
  • Military: The defence sector involves large volumes of people, equipment, and assets. Having a barcode system in place helps keep track of inventory, personnel, commissions, repairs, and future requirements. It also enables effective management of existing resources.
  • Utilities: A utility network is often spread across vast distances, due to which effective tracking is even more important. With barcodes, indoor and outdoor utilities can be monitored and kept track of, helping streamline documentation and asset management.

What are Barcode Scanners?

A barcode scanner or barcode reader is an optical scanner specifically designed to read and decode data from a printed barcode. The scanner then sends the data from the barcode to an attached computer through the output port of the scanner. Similar to traditional flatbed scanners, a barcode scanner also has a light source, a light sensor and a lens, which translate optical impulses into electrical signals for computers to pick up. Modern barcode scanners can connect with computers through USB, Bluetooth and wireless networks, in addition to traditional connections.

Types of Barcode Scanners

Based on the technology used, interface, design and capabilities, there are primarily 4 different types of barcode scanners. These are pen-type scanners, laser barcode scanners, CCD barcode scanners and 2D camera scanners.

1. Pen-Type Scanners

Named after their shape, pen barcode scanners are in the shape of a small wand, resembling a pen. The tip of the wand has an LED light and a photodiode. When the tip is passed over a barcode, LED light is emitted highlighting the black and white bars of 1D barcodes. The photodiode measures the light reflected back, indicating the size of the bars and decodes the barcode. The wand transmits the information to a separate computer or processing unit. Pen barcode scanners are durable, inexpensive, and fast; however, they require some practice by the handler to be able to scan barcodes.

2. Laser Scanners

Laser scanners are more advanced than pen scanners and are among the most popular types of barcode scanners. In a laser scanner, there is a laser beam directed at a mirror within the scanner itself. The mirror reflects the laser rays across the barcode and the light reflected back shows which areas of the barcode are darkened. This reflection is translated into a decoding of the barcode, which is sent to a computer or processing unit. Laser scanners are extensively used in retail and can be either mounted on a fixed surface in a scanning unit or be used in handheld mode. They can scan barcodes from a distance of 6-24 inches, while long range laser scanners can be used from a distance of 2-8 feet.

3. CCD Scanners

Also known as an LED scanner, a charge coupled device (CCD) scanner is a slightly more expensive barcode scanner. In a CCD scanner, there are hundreds of small LED lights in a single long row. All the lights are shot directly at the barcode and a sensor is present in the scanner to measure the intensity of the light in front of each individual bulb. A voltage pattern identical to the barcode is generated. Since the barcode is scanned on the basis of its voltage rather than reflection, all the scans are highly accurate.

4. 2D Barcode Scanners

A 2D barcode scanner is specifically designed to scan and read 2D barcodes. While traditional 1D barcodes are ready only horizontally, 2D barcodes have to also be scanned vertically. In a 2D barcode scanner, there are hundreds of tiny lights, similar to CCD scanners, however, the lights are positioned in multiple rows. To scan a barcode, all of the lights are flashed and a digital image of the barcode is formed, which is then sent to the computer or processing unit. A 2D barcode scanner can decode barcodes regardless of how they are positioned in front of the barcode, boosting the speed of barcode scanning.

Benefits of Barcode Scanners

In any barcode setup, apart from the general benefits of barcodes, there are additional benefits of using barcode scanners. Here are the top benefits:

  • Easy to use: Most barcode scanners are simple to use and only involve directly running the lens across the barcode.
  • Removes human error: A barcode scanner removes the need to enter details manually, thereby removing chances of human error.
  • Saves time and effort: Inventory management and transactions are faster when using a barcode scanner. There are also less people required, so you save time, efforts and money.
  • Wireless: With a wireless barcode scanner, it can be taken wherever needed. This is especially useful for larger products that may be difficult to move.
  • Adjust prices easily: If you want to adjust prices for certain products or during a specific time period, rather than changing each barcode, you can change the setting with a barcode scanner.

Factors to Consider When Choosing a Barcode Scanner

Barcodes can be developed online or through dedicated software. A barcode scanner on the other hand, is a piece of hardware that requires investment. An important component of a barcode setup, here are some factors you should consider when selecting a barcode scanner:

  • Type of barcodes to be scanned: Will you be scanning 1D or 2D barcodes? There are barcode scanners available that can read both types of barcodes, or only a single type.
  • Quality of barcodes to be scanned: Will the barcodes be well defined or are they likely to be smudged or faded at all? If there is a risk of faded or smudged barcodes, a more advanced scanner would be required, while more simple scanners are sufficient for clear barcodes.
  • Location of scanner: Will the barcode scanner be fixed in one location or does it need to be mobile? A cordless barcode scanner is suited for a fixed location setup while a wireless barcode scanner will be ideal for mobile scanning needs.
  • Scanning environment: Will the scanner be used indoors or outdoors? Barcode scanners have different levels of durability, with some scanners able to withstand water spray, dust, and high temperatures, although at an added cost.
  • Volume of scanning: Will there be bulk scanning involved or individual scanning? For larger volumes of scanning, it is advisable to use a barcode scanner with a fast speed and adequate battery life.
  • Light requirements: How much light is available in the environment you will be using the scanner in? Some barcode scanners can read barcodes in dim lighting while others will require good quality lighting for adequate scanning.
  • Scanning distance: What distances will the scanner be reading barcodes from? Barcode scanners support different scanning distances, ranging from a few inches to a several feet.


Over the years, barcode systems have become a necessity for effective inventory management and tracking of assets. The best way to maximise the benefits of barcodes is to have a suitable barcode scanner. The combination of barcodes and barcode scanners can significantly save your time and efforts, while also improving sales.

There are a wide range of barcode scanners available. Depending on the required durability, scanning needs, and mobility, you can find a barcode scanner that is perfect for your needs. As barcode scanners tend to have a long life, they are a worthwhile investment.

POS Plaza offers a vast range of barcode scanners, including cordless, handheld, desktop, omnidirectional, industrial and iOS and Android compatible scanners. Reach out to us for guidance and help in selecting the best barcode scanner for you.

- Also ReadIn-Depth Understanding of How Does Barcodes Work