Understanding Barcode Asset Tracking: A Comprehensive Guide

Barcodes are everywhere—from grocery store checkouts to industrial warehouses. But did you know that barcodes were originally invented to improve inventory management in supermarkets?

In 1948, two Drexel University students, Norman Joseph Woodland and Bernard Silver, developed the first barcode . Their design was inspired by Morse code, but instead of using dots and dashes, they used thin and thick bars. However, it took over twenty years for barcode technology to become commercially successful.

In 1974, the Universal Product Code (UPC) barcode was used for the first time at a checkout line in a Marsh supermarket in Troy, Ohio . The UPC barcode is a linear barcode that consists of a series of vertical bars of varying widths. It can be used to encode a wide variety of information, including the product number, price, and manufacturer.

The success of the UPC barcode led to the adoption of asset barcodes in other industries, including manufacturing, logistics, and healthcare. Today, barcodes are used to track a wide variety of assets, including inventory, equipment, and even patients.

But what exactly is barcode asset tracking? How does it work? And why has such an old technology stuck around for so long? Let's get into it.

What is Barcode Asset Tracking?

Businesses of all sizes use asset barcodes to track and manage their physical assets. This system hinges on two main components: the barcode label and its corresponding reader.

When most people think of a barcode, they're typically thinking of a 1D type of barcode, like Code 39 and Code 128. These barcodes represent data in a series of parallel lines of varying widths and spacings. These lines are read linearly, typically from left to right. Examples include the common barcodes we see on retail products.

But other types of barcodes exist too, and you're most likely familiar with them. Ever been to a restaurant and scanned a QR code to view the menu? That's a type of 2D barcode.

2D barcodes, like Data Matrix and QR codes, store information both horizontally and vertically. They often appear as squares or rectangles filled with patterns of tiny squares, dots, or other geometric shapes. This allows 2D barcodes to store significantly more information than their 1D counterparts, and they can even include multimedia links or other complex data. QR codes, in particular, have gained widespread popularity due to their ability to be scanned with smartphones, linking users to digital content in an instant.

So that's the barcode, but what about the reader? A reader, often a mobile device or a barcode scanner, decodes the data stored within the barcode.

How Does Barcode Asset Tracking Work?

A typical barcode asset tracking system requires asset barcodes, a barcode scanner, and asset tracking software. The system operates in three main steps:

1.  Companies embed data in a unique asset barcode, print it, and then link it to a specific asset.

2.  A scanner or mobile device scans this barcode to retrieve the encoded data.

3.  The system then sends this data in binary format to a computer, which decodes it and saves it in an asset-tracking software database for easy asset management.

How Does Barcode Generation Work?

Barcodes are generated based on a set of standards that dictate their structure and content. Here's an overview of how barcodes are generated:

1.  Choose the Right Barcode Type: Different barcode types serve different industries. 1D barcodes like UPC (used in retail), EAN (international product labeling), and Code 128 (used in logistics) use parallel lines of varying widths. In contrast, 2D barcodes, like QR codes, PDF417, and Data Matrix, store data in geometric shapes like squares or dots, holding more information both horizontally and vertically.

2.  Data Input: Determine the data you want the barcode to represent. This could be a product number, an asset ID, a URL for QR codes, or any other type of relevant information.

3.  Barcode Generation Software/Tools: Use barcode generation software or online tools to convert the desired data into a barcode format. The software will take your data input, apply the rules for the specific barcode type, and produce a visual representation of the barcode.

4.  Barcode Standards and Specifications: If you're generating barcodes for specific industries or purposes (like retail), you'll need to ensure that they meet the requisite standards. For instance, UPC barcodes used in retail need to follow the standards set by GS1, the organization responsible for global business communication standards. This often means obtaining a unique company prefix from GS1 and ensuring the generated codes are compliant.

5.  Printing and Quality Check: Once generated, barcodes can be printed onto labels, products, or packaging. It's crucial to test the printed barcode with a scanner to ensure that it can be read correctly. Companies need to consider the size, resolution, contrast, and placement of asset barcodes on their inventory.

Benefits of 1D Asset Barcodes

Speed and Efficiency

One of the primary advantages of barcodes is the rapid pace of data capture. With just a quick scan, products or items can be registered into a system, eliminating time-consuming manual data entry. This not only speeds up inventory processes but also streamlines point-of-sale transactions, making the entire process more efficient and customer-friendly.


Manual data entry is rife with human errors. In contrast, asset barcode scanning drastically minimizes the chances of mistakes, ensuring accurate and consistent data collection. Moreover, unlike human-readable data that can vary based on interpretation, barcodes provide a standardized format that ensures consistent readings, irrespective of who scans them.


When employees can process transactions or manage inventory more swiftly, businesses can optimize their labor costs. Additionally, errors can be costly, especially in sectors like inventory management or billing. By reducing these errors, barcodes help companies avoid the additional expenses associated with rectifying mistakes.

Universal Applicability

The universality of many 1D barcode standards, such as UPC or Code 128, ensures their applicability across a diverse range of industries and regions. Their widespread recognition means that various systems, from point-of-sale registers to sophisticated inventory management solutions, are designed with 1D barcode compatibility in mind, streamlining processes across different platforms and systems.


1D barcodes are inherently scalable, capable of accommodating both small businesses and vast corporations with expansive inventories.


Barcodes enhance product security in multiple ways. Their ability to track products throughout their lifecycle—from manufacturing to the hands of the end consumer—ensures heightened accountability. This tracking capability not only enhances supply chain visibility but also boosts security measures. Moreover, by assigning unique barcodes to products, businesses can deter counterfeiting, especially when these barcodes are used in tandem with other security strategies.

The Rise of 2D Asset Barcodes and RFID Tracking

The landscape of asset and product tracking has seen significant evolution with the increasing popularity of 2D barcodes and Radio Frequency Identification (RFID) systems. While 1D barcodes have served industries reliably for decades, the inherent advantages of 2D barcodes and RFID are propelling their growth. However, like any technology, they come with their own set of challenges when compared to traditional 1D systems.

Benefits of 2D Barcodes and RFID Tracking

Enhanced Data Storage

- 2D Barcodes: Unlike their 1D counterparts, 2D barcode can store a significant amount of data both horizontally and vertically. This makes them more appropriate for situations where a large amount of data needs to be stored, like a patient wristband that may house a patient's full medical history, current medications, allergies, emergency contact details, and treatment plans.

- RFID: RFID tags contain microchips that can store a wealth of information, far surpassing the capacity of both 1D and 2D barcodes.

Versatile Application

- No Line-of-Sight Required for RFID: RFID scanners can read tags without direct line-of-sight, making them ideal for environments where items are not easily accessible.

- 2D Barcodes in Marketing: With the ability to store URLs or other digital data, 2D barcodes are increasingly used in marketing campaigns, bridging the gap between physical and digital realms.

Improved Efficiency and Accuracy

- RFID's Faster Scanning: Multiple RFID tags can be read simultaneously, expediting processes like inventory checks.

- 2D Barcode's Error Correction: Many 2D barcodes have error correction capabilities, ensuring that even damaged codes can often be read accurately.

Pitfalls When Compared to 1D Barcodes

- Cost Implications: Both 2D barcode systems and RFID tracking tend to be more expensive in terms of initial setup and equipment when compared to traditional 1D barcodes.

- Technological Challenges: Some materials or environments can interfere with RFID scanning. For instance, metal and liquid environments can pose challenges, potentially limiting their application.

- Complexity: While 1D barcodes are relatively straightforward in design and use, both 2D barcodes and RFID systems might require more specialized knowledge and hardware for effective implementation and maintenance.

- Privacy Concerns with RFID: Given the capability of RFID tags to be read from a distance without direct line-of-sight, there are concerns about unauthorized scanning, potentially leading to privacy breaches.

Final Thoughts

Barcode asset tracking is an essential component of the modern business world, and while it has evolved over time, its core principle remains the same: to efficiently and accurately manage and track assets. From the simplicity of 1D barcodes to the data-rich 2D codes and the innovative potential of RFID systems, each evolution seeks to address the growing demands of businesses. Yet, as technology advances, companies must remain vigilant, balancing the benefits of enhanced capabilities with the challenges of implementation, cost, and privacy concerns.