|This series is commissioned by UPS.|
You can hardly have a discussion about RFID and barcodes in the same sentence, without comparing the two. Which is cheaper? Which is easier to implement? Which delivers better results for small businesses? Let’s take a look.
A barcode is a machine-readable insignia of data about an object. We’re probably most familiar with barcodes printed on the packaging of items in grocery stores and retail outlets. You take an item to the cash register, and the clerk scans the barcode using a handheld barcode reader or passes the item over a scanner embedded in the checkout lane. The barcode yields up data about the item, including its price and any discounts applicable.
PASSIVE RFID TAGS
RFID (“radio frequency identification”) is a somewhat more sophisticated technology. An RFID tag consists of a small chip with data in it, and an antenna to transmit information from the chip wirelessly. RFID tags are often very thin — not too much thicker than a printed barcode. There is active RFID and passive RFID. For our purposes here, we’re talking about passive RFID — which simply means that the RFID tag has no internal battery and the wireless signal to transmit the data is activated when the tag is in close proximity to a reader.
Both barcodes and passive RFID tags are useful in a variety of situations and applications. Both can be affixed to equipment, furniture, computers, tools and other company assets so that you can track them. Both can be used on inventory to more quickly, efficiently and accurately manage your inventory stock and fulfill orders. Both can be used in tickets (such as for events), ID badges, and for vehicle identification. They can also be used for supply chain management, tracking packages, and work-in-process orders. And the list of uses in business goes on.
WHICH IS BETTER FOR SMALL BUSINESSES
In most instances today, barcodes will have the advantage over RFID tags (Wasp Barcode whitepaper PDF). Barcodes are cheaper ( a half cent each) than RFID tags (as much as 30 cents a tag). That price difference may not sound like a lot, but multiplied tens of thousands or hundreds of thousands of times, the price difference is not trivial. Add to that the cost of software to decipher, interpret and use the data, not to mention the readers required to read the barcode or tag, and the investment in RFID can be considerable. In a small business, the ROI for installing RFID systems may not be sufficient to justify choosing them over barcodes.
Barcoding is also a more mature technology in business applications. So it tends to be simpler and less complex than RFID-based systems. And barcodes do the job — why go for a complex technology if a simpler and cheaper one works?
On the other hand, barcodes can be slower and a little more labor intensive to scan. A barcode may have to be passed “exactly so” in front of a barcode scanner, and can be read only one at a time. RFID tags just need to be within a certain proximity of an RFID reader (not within line of sight), and multiple tags can be read at once.
Still, the cost advantage and lack of complexity of barcode systems make them a better choice most of the time for small businesses. We small businesses are cost-sensitive. Margins may be thin, and while technology helps us run our business more efficiently at lower cost, given a choice in technologies, the cheaper option often works well.