RFID vs. Barcode – What’s the Difference?

inventory management

What’s the Difference Between RFID and Barcodes?

This is a question we get all the time from inventory pros and newbies alike, in all sorts of industries. More often than not, it’s not really because they truly don’t see any difference between RFID vs. barcode technology – the differences are pretty obvious – but what they’re really asking is, “which one should I choose for my unique situation?”

So, in this article, we’re going to answer both those questions, and we’ll start with the actual similarities and differences between RFID and barcode technology:

RFID vs. Barcode: The Similarities

rfid tag

An RFID chip

RFID and barcodes are similar in a few key ways:

  • If you need to track where your stuff is at, both RFID tags and barcodes can accomplish that for you.
  • They are both means of collecting data.
  • Stored data on both kinds of tags can be retrieved via either fixed or handheld scanning devices, and, therefore, both are incredibly popular as part of the inventory tracking workflow (among many other applications.)

However, these two types of tracking tech also differ quite a bit:

  • Barcodes are designed to be scanned one at a time whereas many RFID tags can be scanned at once.
  • Barcodes require that the scanner maintain a line-of-sight with each code, while RFID is a “near field” technology, so the scanner only needs to be within range of the tag to read it.
  • Barcodes are generally printed on paper or adhesive labels, so they are prone to wear and damage, while an RFID tag is generally a tougher product that can withstand more abuse.
  • The type and volume of data on barcodes is more limited than what can be stored on an RFID tag.

RFID vs. Barcode: Which is better?


A barcode

While it’s easy, reading the similarities and differences of RFID and barcode technology, to assume that RFID is automatically the superior choice, that’s not strictly the case.

It is true that RFID offers a number of advantages over barcodes – especially in certain circumstances – but, there are also situations in which barcodes remain the better choice. For example, if both options will do an adequate job accomplishing the tracking needs of a given business, everything else being equal, a barcode system will likely be less expensive to purchase and integrate. On the other hand, the advantages offered by RFID have made it very popular in recent years, especially for inventory managers who’ve been working with barcodes for some time and have faced frustration due to its inherent limitations.

Placed head-to-head, RFID does generally win on most performance metrics:

  • Speed: RFID is tremendously faster than barcode scanning – One interesting split test shared on YouTube timed a simple inventory capture of 12 pill bottles using the traditional pen-and-paper method, barcode scanning, and RFID scanning. What took a human 2 minutes and 16 seconds only took 37.9 seconds using barcodes. However, an RFID scanner read all 12 tags accurately in just over one second.
  • Function: RFID allows for accurate inventory in adverse conditions – Because it uses near-field technology rather than laser-based line-of-sight, a box or pallet containing numerous tagged items can be accurately scanned without being unpacked. Likewise, fixed RFID antennas and scanners can strategically placed throughout a storeroom, tool crib, warehouse, or an entire facility, passively and automatically registering inventory movement as it happens, rather than requiring that a barcode be struck with a scanning laser at each touch point.
  • Accuracy: RFID is more accurate than barcodes in most real-world situations – This is somewhat more subjective, but in most busy warehouses, shipping centers, or tool cribs, the employees charged with actually using the systems to do their jobs generally find that the one-by-one, line-of-sight requirements for barcode scanning is rarely as quick and convenient as the use of RFID.

Regardless, RFID will probably never completely replace barcode technology because the range of applications – even within the inventory management niche – is so broad.

RFID vs. Barcode: How do you choose?

gopherwerx storeroom

Handheld barcode scanner

The key to deciding which inventory tracking system to use comes down to three basic factors:

  1. What you’re tracking
  2. What you need to know about what you’re tracking
  3. How the tracking is going to take place

Of course, other important factors like cost, and integrating the system with other core systems you’re already using, need to come into the conversation too. But those three factors are the “deal breakers” in most cases.

What you’re tracking

The size, shape, material, and other details of the items you’re tracking will have an impact on whether RFID or barcode systems will work better. For the most part, these factors won’t impact whether or not one or the other technology is possible, but they will impact which choice is practical and preferable.

For example, if the items you’re tracking are all of uniform size and shape, and are coming at you down a conveyor belt one at a time, a fixed or handheld barcode scanner can probably be set up fairly easily. Then, all that’s needed is some way to make sure the barcode label is always facing up. On the other hand, if the array of items being tracked is varied, the environment is fast-moving and sometimes chaotic, and/or the inventory process is complicated by other factors like security, vendor-managed inventory (VMI), or multiple locations, the speed and convenience of RFID can add a lot of value.

A note of caution, however: some materials – especially some metals and certain liquids – can interfere with RFID scanning. Most issues like that can be resolved by strategic tag selection and settings on the scanner, but if troublesome items make up a large part of your inventory, it’s worth considering whether barcoding might be the better option.

What you need to know about what you’re tracking

gopherwerx storeroom

This specific tool

If the extent of what you need to know about an inventory item is whether it’s in stock or out of stock – checked in or checked out – barcode and RFID can both accomplish that task equally well. Recording the current state of an item along with generic product information (like name, SKU, and manufacturer,) is the bread and butter of barcoding. That’s why barcode has ruled retail for decades: in most retail applications – at least at the customer-facing level – that’s all that’s really needed. When you bring your selection to the register, they scan the barcode and the system reads:

“The ‘Cloudy’ sweater made by Acme, size M, in purple is being checked out, remove it from the database.”

Now, the store may have 25 of those sweaters in that size and color, and when that barcode is scanned at the register, the system adjusts that count to show they now have 24. In that case, it doesn’t matter that there’s no way of knowing specifically which one of those 25 sweaters you picked up. The store doesn’t care, because the barcode provides them all the information they need to record the sale and adjust their inventory accordingly.

If, on the other hand, you need to capture more and varied data about each specific, physical item in your stock, a barcode isn’t going to work. Let’s say, for instance, those purple sweaters were limited edition, hand-sewn by Manny Rodriguez, the world-famous sweater maker, and signed personally by Manny himself. To effectively record that someone has purchased “Sweater #14 of 60”, the store would need to use an RFID tag. This is a silly example, but you can see where the need for specific, detailed information regarding a particular, physical object can come in necessary.

Another more down-to-earth example: in a construction firm or machine shop’s tool crib, certain hand tools and power tools are kept in stock for employees to use. The same exact air compressor may be shared by 30+ employees, all of whom are working on different projects and for different customers. That compressor may be taken out of the storeroom and returned many times in a day, or it may need to go to a jobsite and be there for a few weeks. Now, if effective inventory management in that storeroom requires, not just knowing whether or not the compressor is in stock or in use, but also requires knowing who last checked it out, when that happened, what project it’s being used for, what customer is being billed for its use, and so on… only a RFID system will be able to meet those needs.

This ability to provide more granular and extensive data on each tagged item allows RFID systems to produce more robust reporting as well.

How the tracking is going to take place

gopherwerx storeroomDue to the “line-of-sight vs. near-field” contrast described above, the physical environment and processes will also impact which system is the better choice.

As already noted, whether it’s done via handheld scanner or if items are passed through a fixed site, each barcode label needs to be directly read by a scanner that “sees” its unique image. The barcode label needs to be relatively clean and in tact, or it may not read correctly. The opportunity to automate any part of the inventory process is fairly limited outside of the conveyor belt scenario, because scanning a barcode is a very deliberate action that must take place in a particular way, or it won’t work.

RFID tags, on the other hand, just need to pass somewhere within range of an antenna, and multiple antennas can operate simultaneously to read any number of tags. Since the antennas can be built into various configurations and setup with varying ranges, a passive, highly automated process can be designed around whatever the current workflow or environment requires. This flexibility is one of the key reasons many organizations end up going with RFID even if barcoding could work for them.

RFID vs. Barcode: In conclusion

So, in conclusion, the short answer is “it depends.”

There’s no way to determine if RFID or barcode is better for your particular circumstances without evaluating all of the above in light of your unique situation. You’ll want to choose the best possible solution, but you’ll need to balance that decision with budgetary restrictions and a desire to limit the disruption to business as usual. The best way to accomplish that is to work with inventory management experts who can guide you through that process.

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