Barcode Verifier Total Cost of Ownership
Total Cost of Ownership (TCO) analysis was initiated by the Gartner Group a few years ago. I believe I am the first to apply TCO thinking to barcode verifiers, and it is a very important and revealing consideration since verifiers are relatively expensive devices. What are the direct and indirect costs, the fully burdened cost of barcode verifier ownership?
Some people believe that the cheapest verifier is the wisest purchase since all verifiers grade barcodes on the ISO scale, reasoning that the ISO specification levels the playing field such that all verifiers are virtually identical. Although it is true that barcode verifiers grade barcodes on the ISO parameters, not all verifiers are ISO compliant test devices. Furthermore, not all verifiers test and grade all of the ISO parameters. What is the TCO for a non-compliant barcode verifier? Since it doesn’t manage risk or liability, the total cost of ownership of a non-compliant barcode verifier is ongoing and potentially infinite.
The fully burdened cost of a barcode verifier would include cost of purchase, repairs, maintenance and upgrades. The initial factory warranty is an important consideration. A longer manufacturer’s warranty is a deep insight into the manufacturer’s confidence in their product and a meaningful positive factor in TCO.
Are there ongoing costs just to use the device? Older, single aperture wand verifiers required the user to buy a wand for different types of barcodes. Periodic factory recalibration and firmware upgrades can add significant cost of ownership not just in hardware maintenance but also in shipping charges and the intangible of being without the barcode verifier during critical production times. The need to have a redundant verifier more than doubles the TCO for these devices.
The financial justification for verifier ownership must take into consideration not just Total Cost of Ownership, but the Total Benefits of Ownership (TBO) as well. Barcode verifier manufacturers with options to help the user maintain and update their verifier are a benefit of ownership. Performance Qualification test kits are available from some barcode verifier manufacturers. These equip the user to test and self re-certify the device onsite—no shipping, no redundant equipment. Some manufacturers offer Service Contracts that include recalibration and re-certification as well as loaner equipment. One manufacturer provides free software updates to all users including specialized plugins to add important functionality such as logging user data (job reference, press operator, locations, etc).
The cost of the barcode verifier is an important component in the TCO calculation, but not the only consideration. If barcode data structure is a potential liability but the verifier is only testing print quality, even a very low purchase price may not offset the risk of undetected problems that could lead to an unhappy customer, a lost account, damaged reputation and a mountain of liability.
What is the total cost and total benefit of ownership of a barcode verifier? It is not really about cost: it is all about value. A great reseller has a huge opportunity to add real value for the end user. If they really know their products, a reseller can help the user get the right barcode verifier—and then they can train the user to set up, calibrate and use the verifier correctly. Often there is a charge for this, but it is well worth it to make sure the verifier is working correctly and the test results are reliable.
John helps companies resolve current barcode problems and avoid future barcode problems to stabilize and secure their supply chain and strengthen their trading partner relationships.