Bar Coding for Manufacturers

Although bar coding has been around for a number of years, it has been used with only mixed success in the manufacturing industry.However, a number of recent trends have caused many manufacturers to give bar coding serious consideration.First, bar coding technology has improved significantly in the last ten years. There is less chance of creating a defective or inaccuratelabel or reading one incorrectly. Second, bar coding standards now cover a wider range of products. Third, many retailers, who relyheavily on bar coding, are putting pressure on their distributors to use bar codes. The distributors, in turn, are pressuring their manufacturers to use them. Retailers and distributors want the fast, accurate information bar coding gives them, so they are askingmanufacturers to code their products.Finally, and perhaps most important, manufacturers are beginningto recognize that bar coding can dramatically increase their ownefficiency and productivity. They understand that they can realize a return on their investment in a bar coding system. Althoughsomeinefficiency was tolerated in the sixties and seventies, today manufacturers must compete in a global marketplace with growingcompetition from other countries. Cost efficiency is the name ofthe game today, and bar coding is one way to control costs withoutaffecting product quality.

Speed

Data can be entered into a manufacturer’s computer system withinseconds by “reading” a bar code-five to 100 times faster thankeyboard entry. In addition, a lot of sophisticated information can be transferred with minimal employee knowledge or training. For example, an employee on the shop floor can scan the bar code at the beginning and end of a job and/or operation, giving themanufacturer immediate access to labor and inventory information. The alternative to bar coding is to have employees keep writtenrecords while they work-a method that has not proven to be effective.

Accuracy

It’s fast, but is it accurate? The average keyboard data entry system produces approximately one error in every 350 characters. Anoptical character reader (used to read bar codes) produces approximately one error in every 11,000 characters. Hand-held or fixeddevices that run a laser beam across a bar code might cause onlyone error for every 3 million characters read. In addition, barcodingsystems have built-in error trapping mechanisms to catch misreads or inaccurate data.

Manufacturing Applications

There are a number of ways that the speed and accuracy of bar coding can be put to work by a manufacturer. The greatest potential benefits are in inventory evaluation and control and the collection and correlation of labor and production costs.

Inventory Evaluation

Consider the cost of being out of stock: a customer might be lost to the competition. On the other hand, a company with a reputationfor being responsive to its customers is more likely to be successful.To provide that level of customer satisfaction, a manufacturer must be able to keep very close tabs on its inventory. If a manufacturer lacks confidence in its inventory records, its tendency will be to over-order parts and raw materials and carry extra stock. Bar codingcan reduce these unnecessary costs.Manufacturers deal with three stages of inventory: raw material,work in progress (WIP), and finished goods. If suppliers use bar coding, a dock worker can scan bar codes on raw materials or parts as they’re unloaded, immediately updating inventory records.Tracking WIP is critical. When parts or materials are removed from the raw materials inventory, the system must be updated in atimely fashion so the manufacturer knows to order more when the supply runs low. If a worker is able to scan bar codes (affixed toshelves or bins, for example) as these parts or materials are removed, the system is updated instantly.