Designing product numbering and barcode systems

July 20, 2012 4:16 AM

Assume I'm starting an e-commerce selling (retail, brand-y stuff) sports apparel and equipment. How should I design the product numbering and barcode system if I want to manage products, shipments, inventory, and warehouse locations?

1. I will purchase products from all around the world, some have barcodes others don't. I will probably create a non-intelligent product numbering system (there's no semantic data in the SKUs) but what about the barcodes? Should I keep barcodes that already exist and create ones for products that don't have barcodes based on their SKU? Won't this create inconsistent barcode design, e.g. a pair of nike shoes have an EAN13 barcode but my imported gloves have a 5-digit barcode corresponding to their SKU?

2. I'm thinking of using barcodes on the shelves, rooms, areas and other locations of the warehouse. This way I want exactly what goods I have at a specific location without visual inspection. Should this location barcode numbering system be part of an overall number system or stand alone? Ideally I never want barcodes to collide regardless if they're for a product, warehouse location or invoice. Speaking of invoices...

3. I want to place barcodes on customer shipments and invoices that they receive so I can efficiently handle returns and support calls. Again, should the barcode be based on a company wide numbering system or just order number?

I'm new to the field of warehouse/inventory management and I have a tendency to overthink design so please let me know the best practices for web based retail small/medium businesses.

posted by Foci for Analysis to work & money (7 answers total)

Do you need 1. your own warehouses and 2. your own bespoke inventory software if it's for small/medium business?
posted by joost de vries at 6:51 AM on July 20, 2012

The warehouse is fairly small but will store hundreds of SKUs. If you're thinking of 3PL it's just too expensive right now (this being Sweden).

The inventory system I'm going to use is off-the-shelf, web based and fairly cheap. Not sure how your question is related to creating the product numbers and barcodes :)
posted by Foci for Analysis at 8:03 AM on July 20, 2012

what kind of scanner are you going to use? a dedicated hand-held intermec/honeywell/etc or something smaller, like a smartphone app? how are you going to print your barcodes - thermal transfer printer or laser? and how are you going to transfer the data you scan to the computer you use to handle the info - a wireless connection in the warehouse or direct connection from the scanner to the computer (ie, a physical sync)? all of those things are going to dictate what kind of barcodes you can scan and what kind of useful work you can do with them.

the easiest way to organize your internal part numbering system after you have that sorted is to think of each 'type' of thing as a level, or zone. like all stuff starting with number 1 denotes shoes, all stuff starting with 4 denotes equipment, all stuff starting with C denotes the south corner of the warehouse. If you sell or ship in anything other than single units, you'll probably want to append something like _100 or _200 to your part number for the unit/master packs, to make shipping easier.

You are going to have to re-label things you ship to other sellers (if you do that sort of thing) with their internal part number system. It makes more sense to use your own part number system for everything rather than trying to co-opt someone else's for some things.
posted by par court at 8:08 AM on July 20, 2012

It must be possible to run connect to the web based inventory system, so I'm leaning towards a larger barcode device with Wi-Fi.

I will probably use a thermal printer because I've used one before and the quality/price was satisfying.

The numbering system you suggest makes sense. I have been thinking of using a SKU format according to MM-NNNNN (where MM is a product category identifier) or just NNNNN and what you say about having prefix characters as name spaces (1 for shoes, 4 for equipment, etc) would work with this.

I've been reading about so called intelligent/significant numbering systems and they seem to have fallen out of favor because they are hard to maintain, it's difficult to expand to new namespaces, etc. Which is why I'm gravitating towards using NNNNN SKUs. Any thoughts on this?

I forgot to mention the order fulfillment process. So the e-commerce engine transfers new order data to the invoicing/inventory system. I will select a new order to process and print out the details. Picking is simply going to the right warehouse location, pick the item, and so on until all items are picked. Next, I will package and ship the product to the customer according to the shipment details on the order. So where in this process would I use the barcodes? I was thinking during picking (to confirm that the item has been picked) but I could just tick of the item in the order printout.

I'm equally confused when it comes to having to put barcode stickers on the products themselves. For efficient warehouse management, is there ever a need for this or should I put the stickers on the shelves that the products are on or maybe in a binder next to the shelf?

Preview: God is this poorly written. Please ask if anything seems vague or unclear.
posted by Foci for Analysis at 9:28 AM on July 20, 2012

Its been a while since I did this for myself, but I've used several methods in the past. The first option was based on individual components of a larger system and the SKU numbers related to how the parts were related to each other. Logical, but doesn't make warehousing any easier.

Back then, my perferred method, especially in an apparel setting, was to use based the SKU numbers on storage location. If you do it right, an untrained person can pick orders fairly quickly. I'd use something like AABBCCDD where AA is the aisle number, BB is the Bay number, CC is the shelf and DD is slot.

My current preference is to use what ever barcodes the supplier is providing and include this picking number somewhere on the pick sheet. If you can maintain a barcode and a SKU or pick number in your inventory management system, then all the better.

I don't think you need to relabel anything these days. All big suppliers will have EANs and you should insist on your smaller suppliers doing the same. It's much easier to affix codes at point of manufacture than in a receiving area.
posted by dantodd at 6:30 PM on July 20, 2012

I will probably use a thermal printer because I've used one before and the quality/price was satisfying.

good, at the number you're talking about printing anything else would take too long.

I've been reading about so called intelligent/significant numbering systems and they seem to have fallen out of favor because they are hard to maintain, it's difficult to expand to new namespaces, etc. Which is why I'm gravitating towards using NNNNN SKUs. Any thoughts on this?

you have to accurately gauge your rate of growth/expansion at the beginning (or risk running out of appropriate number sets), or use a flexible/open-ended code set like code 39 (so you can just add on to the number set as you expand). this is possible but you might want to think about -why- you want to do this - is it to make fulfillment easier? if so, everybody involved has to understand the system, and it somewhat negates using the scanner for fulfillment (more on that in a minute). you can get really complex in your numbering system but as you expand, you're moving a lot faster and the last thing you want to think about is whether or not these 80 new products adhere to the original system. or say you get someone to help you out and they are not as good at applying products to the original system and it annoys you, so you have to go back and re-do it - re-label, re-enter into the system, etc. in my experience they fell out of favor because they create more work than they are worth.

So where in this process would I use the barcodes?

putting a code on your order paperwork only makes sense if you generate a lot of physical hard copies, have them filed away, need to reference them regularly, and the person accessing them also has a scanning device. if you're keeping everything digital there is no need for an actual code; that is what order numbers are for. the reason why you see them on fulfillment paperwork from extremely large retailers or 3PL's is because the pickers are transferring picks to the packers, who are putting it into the box for shipment, and the last thing they do before closing the box is scan the code and line items for compliance reports. there are much easier ways to do this when you have a smaller warehouse and it is likely not applicable to your needs yet.

I'm equally confused when it comes to having to put barcode stickers on the products themselves. For efficient warehouse management, is there ever a need for this or should I put the stickers on the shelves that the products are on or maybe in a binder next to the shelf?

it depends on how you plan to do your picks. are you going to do one order at a time? are those orders less than ~7 line items or so? then you can do the whole order in one pass and tick them off by hand or scan the barcodes on the rackspaces (if you have a scanner that is going to be communicating with the order and performing line item checks for pick/pack). But if you're going to do one or two picks a day for multiple orders, and those orders total several hundred items, you're going to need to either scan the rack barcode as many times as items you're picking (to tick off each line item for multiples from the same rack) or scan the individual barcodes as you toss them into the bin to take back to the packers. also, if you rack differently packed units in the same rackspace (WHICH YOU SHOULDN'T because that is terrible warehouse design but some people do) then you run the risk of picking multiples rather than singles or vice versa.
posted by par court at 6:35 PM on July 20, 2012

My current preference is to use what ever barcodes the supplier is providing and include this picking number somewhere on the pick sheet. If you can maintain a barcode and a SKU or pick number in your inventory management system, then all the better.

Good that you reminded me that I can put lots of valuable info on the pic sheet itself.


I don't think you need to relabel anything these days. All big suppliers will have EANs and you should insist on your smaller suppliers doing the same. It's much easier to affix codes at point of manufacture than in a receiving area.

I will import goods and unfortunately some will almost certainly not have barcodes let alone an actual EAN that's been registered. But I will make a real effort to convince my colleagues that we should insist on everyone having EAN.

in my experience they fell out of favor because they create more work than they are worth.

That's my take too. I think intelligent numbering systems are a remnant of old days where you couldn't rely on IT for fast data lookups. These days we can shove pretty much any product data in a database filed. An NNNNN SKU format supports 9 million unique SKUs which is more than we will ever need. So NNNNN it is, then.


there are much easier ways to do this when you have a smaller warehouse and it is likely not applicable to your needs yet.

I suspected this because scanning product barcodes in the warehouse didn't make much sense for a small business.


it depends on how you plan to do your picks. are you going to do one order at a time? are those orders less than ~7 line items or so?

We will have a couple of dozen order per day and will average on 3-9 items per order. Picking on order at the time could indeed work but I've been reading on the various picking systems and think we will reach a threshold where grouping the orders could be more efficient.


Thanks you both so much for your comments. I feel a lot of things have been cleared up and simplified.
posted by Foci for Analysis at 4:21 AM on July 21, 2012