This article is brought to you by GS1 US.
A new kind of barcode showing up on packaging has the potential to benefit retailers and consumers through one big factor: data.
Capable of holding significantly more information than traditional UPC barcodes, 2D barcodes are becoming a common feature on product packaging. While consumers may not know them by name, most are already familiar with one type of 2D barcode: the QR code.
Retailers are already talking to payments solutions provider Verifone about the 2D barcodes. The barcodes’ ability to hold more information can be helpful to operators, letting them know which items need to be removed during a recall or when an item is expiring, according to Anil Bhat, head of product for the petroleum group at Verifone.
“They’re definitely very excited about both of these,” Bhat said.
But before retailers can run with these new capabilities, the convenience industry needs to finish walking through the transition.
“Our industry is, to some extent, notorious for procrastinating until the last minute,” Bhat said.
So why is putting off this particular transition not a good idea?
“One is the capital investment, if they have to make it,” he said. “And as these barcodes become more common, you may run the risk of some products transitioning away from traditional UPC-only labeling sooner rather than later.”
GS1 US is the not-for-profit leading Sunrise 2027, an industry initiative to prepare retail systems to scan 2D barcodes at the point of sale by the end of 2027. GS1 US and Verifone are connected through their partnership with Conexxus, the industry’s technology standards group.
“We work very closely with Conexxus to ensure that they understand and interpret our standards for Sunrise 2027 and are properly implementing that in line with what their industry needs,” said Lindsay Hillman, director of global standards at GS1 US.
A number of products on the market today already carry 2D barcodes, primarily in the health and beauty space, Hillman said. “We are starting to see more consumer packaged goods, more food brands, more c-store related products adopting 2D barcodes powered by GS1,” she said.
While working with retailers, the organization often points out that being ready for Sunrise 2027 helps the brands that are putting the 2D barcodes on packaging.
“Retailer readiness can help create the confidence brands need to move forward with packaging changes and 2D barcode adoption,” Hillman said. “By configuring point of sale systems now, you’re able to support a brand through testing the newly implemented 2D barcodes building a clear partnership since you sell those products every day, it’s a good way to support brands through their adoption process. Another benefit to that support is understanding what information they are including in their 2D barcode enabling you to utilize all the information that they’re providing earlier.”
For now, the 2D barcodes are expected to be co-located on packaging with the UPC barcode until retailer readiness to read 2D barcodes reaches about 90% to 95%.
“This is a sunrise, not a sunset; we do not anticipate the UPC to disappear overnight,” Hillman said.
Retailers can prepare for the transition to 2D barcodes with these five steps:
1. Review All Scanners
Retailers should make sure they have optical scanners capable of reading 2D barcodes across all their locations and throughout the whole store.
That means not only the scanners at the cash register, but also those used at self-checkout and for inventory management, Bhat said.
“The scanner can be at multiple points of interaction at a store,” Bhat said. “The same rules apply, meaning the hardware has to be capable and the software needs to be programmed.”
Point-of-sale (POS) hardware and software also need to be evaluated to ensure they can process the data contained in 2D barcodes, he added.
2. Replace Hardware
After evaluating their current hardware, retailers that don’t already have the optical scanners necessary to process the 2D barcodes will need to acquire them.
“Ideally, retailers would go to their local vendor or distributor who handles POS equipment and be able to request one,” Bhat said.
“Most major manufacturers will have information for retailers wanting to double-check if the scanners they’re buying are Sunrise 2027 capable,” Bhat said. “We believe that scanners that have been deployed in the last four years, if not longer, should all be capable, just requiring a configuration update.”
“If a retailer does need to update its equipment, it’s better to start planning for those investments now than wait until the last minute, when other retailers might be doing the same thing,” Bhat said.
“Retailers are going to rely on the servicer or distributor to get equipment and get installation done,” Bhat said. Businesses that put off those investments “may be facing the rush with those folks and not necessarily getting the right attention or time.”
3. Update Programming
Even if a scanner is capable of reading 2D barcodes, it may still need to be programmed to ensure it can actually process the format as intended, Bhat said.
This is usually a “fairly easy step,” according to Bhat.
“Typically the programming guides provided by the manufacturer have that,” Bhat said. “We provide for our scanner, ‘Hey, here’s what you need to do.’ … It is just a set of steps or codes they have to incorporate into the scanner.”
4. Test Before Flipping the Switch
GS1 US offers a 2D barcode test suite that retailers can use with their systems, Hillman said. It includes several different setups of 2D barcodes to confirm that scanners are capable of reading whatever combination of data carriers and information comes their way.
She recommends testing in phases, starting with a sample product outside of an actual store if possible. “You’re not just flipping on all of your store landscapes without some testing in a lab environment,” Hillman said.
Then retailers can test products that they carry in their stores in this environment before moving to a small in-store pilot, Hillman said.
“The test suite gives retailers a holistic approach to testing different combinations of data carriers, linear barcodes co-located with the 2D barcode, all of the different syntaxes available to test across different scan modes that you would be utilized in a retail environment,” Hillman said.
5. Look to Future Features
Beyond simply identifying products, 2D barcodes can carry a range of additional data. But retailers will have to program decision points around some of the data 2D barcodes contain, such as expiration dates, Bhat said.
“Do you want to prompt and say, ‘Do you want to continue to sell this?’ … Or do you want to give a discount to the customer?” Bhat said. “Conexxus is working on an industry standard for that, and we’re an active participant in shaping it.”
The same is true with manufacturer codes being part of the 2D barcodes, according to Bhat.
“If you have a manufacturer code that’s been recalled, how is that information communicated back from a price book? Or how is that information programmed into the POS?” Bhat said. “Those are the things that we’re trying to define and work through.”
