Have you ever watched ship traffic at a commercial port? It can only function if every ship is distinctly identified. Some are waiting in the harbor for docking, some are being unloaded and others are being cleared for new loads. It’s a finely orchestrated process that requires organization, details and standardization. Similarly, smooth global commerce relies on standardized product IDs. For e-commerce businesses, GS1 provides that essential identification system.
GS1 identifiers like barcodes and Global Trade Item Numbers (GTINs) allow companies to accurately label, track, and transact items across borders and platforms. Without these unique product IDs, supply chains would sink into turmoil, like cargo ships without names congesting the harbors. GS1 product IDs can help steer your supply chain and optimize processes to ensure your e-commerce operations sail swiftly around the world. Just as port authorities use ship names for navigation, GS1 IDs are indispensable for managing the intricate operations of global trade.
What is GS1?
GS1 is a non-profit organization that creates universal standards for identifying products, services, and companies globally. Their most recognized standard is the barcode. For e-commerce businesses, GS1 IDs like barcodes give each product a distinct, scannable identity. This enables smooth supply chain coordination by allowing partners to accurately track and trace items.
While barcodes can be purchased from various sources, GS1 barcodes are the globally accepted standard. Some low-cost barcode providers simply reuse old codes from discontinued products they find online, leading to product identification issues that will hurt your credibility as a brand. Using GS1 barcodes verifies authenticity since every code is unique and licensed to your brand. By registering unique barcodes through GS1, brands can establish product legitimacy and seamlessly coordinate global operations.
Is GS1 ID or UPC the Same as a SKU?
Both UPCs (Universal Product Code) and SKUs (Stock Keeping Units) are essential identifiers in the retail and e-commerce industries, but they serve different functions and are used in distinct ways. The main difference is that a SKU is assigned by the brand and the UPC is assigned by GS1.
SKUs are designed for internal use by retailers. They help in organizing inventory, tracking stock levels, and identifying products based on various attributes (like size, color, or vendor). There’s no centralized organization for SKUs, and their format can vary widely between companies. The SKU can be changed across any platform, even having different SKU names for the same product on various sales channels. For instance, a blue medium-sized shirt from Brand X could have an SKU of “BRX-SHRT-M-BLUE” in one store and “XMBLUESHIRT” in another. This can create a real headache for your logistics teams, as they need to map that SKU to the appropriate UPC since a product can only have 1 unique UPC code.
You can have as many SKU names as you want, just make sure your tech stack is synchronized or “mapped” for the UPC code so that your 3PL can pack and ship the right item. The same applies if you’re selling on Amazon and they assign an “ASIN” to your listing. That ASIN will need to be mapped to your warehouse WMS so they know which product to pack.
The GS1 ID – terminology
Acronyms again! What is the difference? The terms “GS1 ID”, “Barcode”, “GTIN”, and “GSRN” are all related to the GS1 system of standards, which is used globally for business communication.
GS1 ID is a general term for a globally accepted system of unique codes that plays a crucial role in streamlining the supply chain. Standardized by GS1, these identifiers are essential tools for tracking and managing the movement of goods from manufacturers to consumers. By using GS1 IDs, businesses can ensure more efficient and transparent operations, making it easier to trace products at every stage of the supply chain.
Think of it this way: just like every cargo ship has a unique identification number, every e-commerce product should have its own GS1 ID. This unique code allows businesses all over the world to speak the same “language,” regardless of the software they use. With an enormous amount of data flowing through the global supply chain each year, these unique identifiers are essential to ensure that products move smoothly and accurately from where they’re made to where they’re sold.
Under the umbrella of “GS1 ID”, there are several specific identification numbers like GTIN (for products), GSRN (for service relationships), SSCC (for logistics units), and more.
GTIN (Global Trade Item Number). The Global Trade Item Number (GTIN) is a special kind of GS1 ID that’s used to uniquely identify products and services. Whether it’s pricing, ordering, or invoicing, the GTIN helps keep track of items at every stage of the supply chain. Depending on the product and where it’s sold, GTINs come in different lengths like GTIN-8, GTIN-12 (also known as UPC), GTIN-13 (or EAN), and GTIN-14. You’ve seen these before if you’ve ever done self checkout at a store. This number is the barcode on the product’s packaging, making it easy to scan and manage.
Barcode. The word “barcode” is a catch-all term for any kind of data that’s displayed in a format that can be scanned and read by machines. Again if you’ve used self-checkout at a grocery store, you’ve scanned these barcodes to ring up your items. There are various kinds of barcodes, such as UPC, EAN, Code128, and QR Code, to name a few. These barcodes make life easier for warehouses and shipping centers by allowing them to quickly and accurately gather information, like product details, with a simple scan.
UPC (Universal Product Code). UPC is a type of barcode mainly used in North America to identify retail products. It’s the go-to barcode for tracking items in stores, and it’s also crucial for managing inventory and sales in e-commerce. UPC codes usually come with 12 digits and exist in two main forms: UPC-A and UPC-E. The UPC-A version, which is more commonly used, offers detailed information about both the manufacturer and the product. On the other hand, UPC-E is a shorter, 6-digit version designed for products with limited packaging space, like cosmetics.
EAN (European Article Number or International Article Number): EAN, also known as the International Article Number, is a barcode system used mainly outside of North America. It comes in two main formats: EAN-13, which has 13 digits, and EAN-8. EAN codes are essential for tracking and identifying products in International e-commerce. They come in both a longer version (EAN-13) and a shorter, compressed version (EAN-8). EAN is the go-to barcode in Europe and many other countries. Just like with UPC, companies need to register with their national GS1 office to get a unique manufacturer code, which they can then use to generate EAN barcodes for their products.
QR Code (Quick Response Code): A QR Code is a two-dimensional barcode that can hold text and numbers. You’ve probably seen or used one in a restaurant to view a digital menu or in a museum to learn more about an exhibit. In the e-commerce world, QR codes serve multiple purposes. They can be used for mobile ticketing, making payments, labeling products, and even connecting online and offline marketing efforts. For example, scanning a QR code can take you directly to a website, promotional offers, or contact details.
SSCC (Serial Shipping Container Code): SSCC is an 18-digit number designed to uniquely identify large shipping containers, like oversized pallets or boxes, within the supply chain. This unique code helps in tracking and tracing these containers at every step of the logistics process. The 18-digit SSCC is made up of four parts: an Extension Digit, a GS1 Company Prefix, a Serial Reference, and a Check Digit. It’s often used alongside Electronic Data Interchange (EDI) systems, particularly in Advance Ship Notices (ASNs), to give a detailed breakdown of what’s inside a shipment. In essence, the SSCC serves as a unique “name tag” for shipping containers, making it easier to manage and trace them throughout the supply chain.
GS1-128 (formerly UCC-128): Unlike standard barcodes that you might find on individual products, GS1-128 is used to label larger containers or shipments. It’s like a digital ID badge that holds a wealth of information, from what’s inside the container to where it’s headed. In the realm of Electronic Data Interchange (EDI), GS1-128 is not just invaluable, but required by many retailers doing B2B transactions. It helps companies keep tabs on these larger shipments as they move from manufacturer to distributor, and finally to the retailer. When a retailer receives a shipment, the GS1-128 barcode can be scanned to instantly provide all the details about the contents, origin, and destination of the goods. This makes the process of receiving, sorting, and managing inventory far more efficient and accurate, as well as confirming the shipment against their original Purchase Order.
GS1 Databar: GS1 Databar is a type of barcode that goes beyond just identifying a product. It can also carry extra information like the weight of the item or its expiration date. This makes it particularly useful in CPG e-commerce for products that have varying weights or are perishable, like fresh produce. Plus, it’s a great option when you’re dealing with limited packaging space, as it can pack a lot of information into a small area.
Less common types of Barcodes
Data Matrix: is a two-dimensional barcode that’s a master at holding a lot of information in a tiny space. It’s commonly used to label small electronic parts, where real estate is limited. You’ll also find it on product packaging, where it serves as a compact source of key details about the product, including its origin and journey through the supply chain. Data Matrix is like a mini-database that fits in the palm of your hand, providing crucial information without taking up much room.
PDF417: is a less common but highly capable two-dimensional barcode that can store a significant amount of data (over a kilobyte, to be exact). In the e-commerce world, it’s particularly useful for labeling electronic components and tickets. It’s also handy for managing and tracking larger transactions like shipments and purchase orders. Though it may not be as popular as other types of barcodes, its ability to hold a lot of information makes it a valuable tool for specific needs in e-commerce and supply chain management.
ITF: This barcode type uses a continuous pattern of two different widths to encode numerical data. It’s a go-to choice for labeling in warehouses, as well as for packaging and carton labeling in the e-commerce logistics sector. It helps streamline the process of tracking and managing goods as they move through the supply chain.
Aztec Code: This is a compact two-dimensional barcode that’s perfect for digital applications. In the e-commerce world, you’ll often find Aztec codes used for electronic tickets, coupons, and even mobile payments. Their small size and the ability to be scanned directly from screens make them highly versatile for various digital transactions.
The choice of barcode in e-commerce largely depends on the specific application, the information required, and the available space on the product or packaging.
Why Retailers Rely On GS1 IDs
For retailers, the GTIN is not just numbers, it is critical for efficient inventory management. Retailers can use a GTIN supplied by their vendors to manage stock handling, shipments, and expenses, significantly improving operational efficiencies for both parties.
- Unique Product Identification: Each GS1 ID is unique, ensuring that every product can be distinctly identified, reducing the chances of mix-ups or duplication. Often retailers will check GS1 to verify the ownership of a product by a brand.
- Global Standardization: GS1 IDs are recognized and used internationally, which establishes a common language for global trade. This ensures that products are identified consistently regardless of where they are sold or manufactured. This is essential for vendors and retailers operating in different countries.
- Efficiency: These identifiers are designed to accelerate order fulfillment with reduced manual inputs. For retailers, the GTIN or GSRN are not mere numbers, they are the keys to unlocking efficient inventory management. When suppliers share their GTINs, these numerical IDs help retailers streamline many tasks, including purchasing, stock handling, shipments, and expense tracking which creates much needed operational efficiencies. This also leads to reduced manual intervention and human error, saving valuable time and costs.
- Customer Service: When retailers have clear organization of GTINs, handling critical matters such as recalls and product safety information becomes exponentially easier. This level of visibility minimizes errors and contributes to substantial time and cost savings.
- Enhanced Supply Chain Visibility: With GS1 IDs, businesses can trace products throughout the entire supply chain, from manufacturer to end consumer. This transparency is crucial for managing recalls, ensuring product authenticity, and combating counterfeit products.
- Accuracy: The GTIN enables the accurate identification of products across different systems or platforms. Imagine a retailer needs to update their product information on an e-commerce platform. If they’ve sourced the GTIN from the supplier previously, all they need to do is refresh their data feed. The platform will then effortlessly recognize each item, ensuring information accuracy and reducing potential errors.
- Scalability: As your e-commerce horizon expands, relying on GS1 ensures operations remain coordinated and that your unique identifiers are all organized together under your business name. Earlier we mentioned some suppliers providing re-used barcodes, those barcodes are not licensed to your company and will prevent future scalability.
- Integration: Given their universal acceptance, GS1 IDs can be seamlessly integrated into various systems and platforms. This ensures that different businesses, even those using different software or systems, can collaborate effectively.
- Enhanced Data Quality: GS1 standards also encompass data quality restrictions, ensuring that the information linked to GS1 IDs is accurate, complete, and up-to-date.
- Combat Counterfeit Products: The unique identification provided by GS1 helps in ensuring product authenticity. Retailers can confidently assure customers about the legitimacy of the products they sell. Since these barcodes are unique, and licensed through GS1, it is a serious impediment to a counterfeiter selling a version of your product.
- Electronic Data Interchange (EDI): GS1 IDs, when used in conjunction with EDI, help automate business transactions, making them more efficient and error-free.
- Real-time Data Access: Modern GS1 standards extend the power of the barcode by connecting it to dynamic online data. This provides businesses and consumers with real-time information about the product. GS1 also keeps all your barcodes listed in your account and are easily searchable. This allows your Ops team to ditch the spreadsheets and rely on GS1 to keep the product list in order.
- Support for Omnichannel Sales: GS1 IDs enable consistent product identification across various sales channels, be it online, in physical stores, or through mobile apps. This consistency is crucial for an integrated and seamless customer experience in today’s omnichannel retail environment. As previously mentioned,if a retailer does a search to confirm you own the product you’re selling, the transaction will go a lot smoother for your team.
- Regulatory Compliance: The benefits of using GS1 IDs extend beyond efficient inventory management and data accuracy. They also simplify auditing processes and help in regulatory compliance. Many industries and regions have regulations that require specific product identification standards. Utilizing GS1 IDs helps businesses comply with these regulations, avoiding potential legal complications and market access barriers.
In the constantly changing world of e-commerce, three things are key: consistency, efficiency, and trust. The GS1 ID system plays a crucial role in allowing brands to uniquely identify their products, building a foundation of trust with their business partners. Retailers depend on GS1 IDs from their suppliers to keep track of inventory and streamline operations. As online shopping platforms aim to offer flawless customer experiences, the significance of GS1 IDs can’t be overstated. They have become an essential tool in modern e-commerce, helping businesses operate smoothly and maintain high levels of customer satisfaction.
By integrating GS1 IDs into your e-commerce strategy, you’re not just adopting a system; you’re investing in a trusted standard that enhances operational efficiency and customer trust. And in today’s competitive commerce environment, that’s a game-changer.
If you need help navigating the GS1 database or getting your barcodes, please contact SullyGarman & Associates and we are happy to help!