Barcode Quality – The Business Case for Verification

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Barcode Quality is an attribute of supply chain optimization

Barcodes are more than ubiquitous—they are an integral component in the supply chain. As such, barcode quality is integral to supply chain performance. Barcode performance is an attribute of supply chain optimization.

Barcode quality is the province of barcode verification, and yet seldom is the business case for verification made. Those of us in the barcode quality business often equate it to risk management, and invoke the insurance model—and it is an apt comparison. But out there in the “real world” it is a hard sell to anyone except the select few who have gotten religion: those who have been fined. To almost everyone else it relegated to the realm of disbelief and “it can’t happen here”.

Well guess what: it can happen here—and it has. The myth that fines from retailers only happen to others is perpetuated by the secrecy that shrouds it when it does happen. Nobody admits it and there is virtually no other avenue down which anyone can find out who was fined and for what.

But on an industry-wide scale, often with no names mentioned, the fines can be breath-taking. In New Zealand, for example, fines in the regulated kiwi fruit industry have exceeded $280,000 for one packing house alone

The business case for barcode quality is much broader and deeper than the cost of even a very large retailer fine. When product doesn’t reach its intended destination not only does it fail to transact with consumers, in the case of perishable goods the value is a total loss. Even relatively non-perishables won’t sell when the inventory goes where it is not needed. Add to that the shipment costs.

Barcode Quality: When barcodes fail, everybody loses

But the largest part of the total cost of the disruption to the supply chain is intangible: consumers who can’t find kiwi fruit or oranges in their grocery store blame the grocery store, not distribution/logistics. In the broken supply chain, some lose more than others, but everybody loses.

Put a conservative value on those intangible costs and add up the losses, and verification ends up being very cheap insurance. One could even make a return-on-investment case for verification, but in truth it really is an insurance/risk-management model. You get it not because you ever expect to draw on it, but just in case.

Barcode quality is very inexpensive risk management.


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