The accurate and efficient tracking of inventory is essential for maintaining streamlined manufacturing operations, meeting customer demands, and optimizing resource utilization. Over the years, inventory tracking technologies have evolved from pen-and-paper record-keeping to sophisticated technology-based solutions. Two prominent methods, barcode technology and Real-Time Location Systems (RTLS), have emerged as frontrunners in the quest for effective inventory management. But which is truly the best? And is there any difference to begin with?


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Tracking Inventory with Barcode Scanners

Barcodes are machine-readable representations of data, typically displayed as a series of parallel lines with varying widths. These codes hold essential information about products, such as their SKU, name, and price. The simplicity and universality of barcodes make them a common tool for inventory tracking across diverse industries.

A successful barcode inventory tracking system comprises three key components: barcode labels, scanners, and backend software. The process of barcode scanning involves capturing the barcode's visual data using either a handheld or mounted scanner, which then decodes the information and presents it in a readable format when the barcode is within proximity. This information is then communicated to the backend software, which processes, stores, and analyzes the data.

To best demonstrate the strengths of barcode asset tracking, let us run through what regular usage of this system would look like in a manufacturing environment. There are two types of assets that are referred to as “inventory” within manufacturing: raw materials and finished goods. It is important to track both, in order to understand what components you have available and what products are being produced and shipped out. With barcode scanning, each container of material or product can be affixed with a label, usually a sticker. Workers then scan the labels when they move those materials to new locations, creating a record of where they’re being stored. Similarly, they’re scanned when they’re used or when they leave, creating a data trail for the flow of inventory through the plant.

Tracking Inventory with RTLS

RTLS is a technology that enables the real-time tracking and monitoring of the location, movement, and condition of assets within a defined space. It uses a network of readers and tags to accurately determine the position of objects, which are then reported back to a central-access platform. The information collected is then processed by specialized software to provide real-time visibility into the whereabouts of assets and store any critical data points for further analysis.

RTLS asset tracking relies on tags and readers to function, much like barcode asset tracking relies on labels and scanners. However, the difference is that RTLS does not require the same direct proximity to obtain a reading for an asset’s location. Instead, tags emit signals that are picked up by stationary readers strategically placed throughout the facility. Location is then determined based on these signals.

Once again, let us work through how this system might be used within a manufacturing plant’s daily operations. Again, we will do this in regard to both component inventory and completed inventory. Using RTLS, any container fixed with an asset tag is automatically tracked throughout the facility without any action required from workers. Instead, the tag periodically sets out a signal, and when the location has changed between signals, the location is updated within the system. This means that there is a constant record of location, even if something is placed where it shouldn’t be. As with barcode tracking, this system can also be used to keep track of what materials have been used and what products have left the facility, allowing operators to make informed decisions about changes to the production process.

Drawing a Comparison: Barcode vs. RTLS Asset Tracking

When looking at these two scenarios, it's easy to see the similarities between these systems. Both provide a record of an asset’s location and usage so that operators can better understand and control their daily operations. There are, however, also many key differences that show that these systems are not on the same level. Some of these differences include:

Barcode tracking is manual; RTLS tracking is automatic.
The first and perhaps most obvious difference between barcode and RTLS tracking is that barcode tracking is manual while RTLS tracking is an automated process. Barcode tracking requires workers to scan each barcode individually. Even stationary scanners require the barcode to be brought within a given proximity in order for a reading to occur. It is another step in the process for workers; one that they can get used to, certainly, but also one that prolongs operations and can be easily overlooked.

Since RTLS tracking is fully automated, it does not have these same shortcomings. Employees do not need to take active measures to get readings from an RTLS system. Instead, once the system is set up, it runs on its own without input for anything other than occasional system maintenance. This means that there’s a lot less room for human error, leading to more accurate location reports overall. It also means that employees don’t have to spend time manually scanning items when checking them in and out of locations; instead, they can spend their time doing the work they were actually hired to do.

Barcode and RTLS tracking require different degrees of setup and maintenance.
As alluded to in the previous point, barcode and RTLS tracking systems do not have the same setup and maintenance needs. Barcode systems typically function by affixing stickers to important assets. Scanners don’t require much setup, as they’re usually handheld devices carried by workers or simple mobile apps that are downloaded onto cell phones. Some stationary scanners may require installation, if they’re preferred by management. After setup, barcodes will need to be placed onto new assets as they come and old assets as old labels begin to wear off. After all, barcode tags are essentially stickers, and they can wear out to the point that the scanner can no longer read them.

RTLS systems require more setup up front, but ultimately less maintenance down the road. When these systems are first installed, readers and other infrastructure must be set up throughout the facility in order to receive and store the data generated from the tags. Depending on your facility’s layout, this might require more or less effort; more open spaces are generally easier to outfit while those with too many smaller rooms or corners might take more time. Once that infrastructure is in place, however, you’re good to go! From there, you simply affix the appropriate tags to the inventory containers you want to track and replace the system and tag batteries when they run out, which usually takes a couple years. Asset tags are made to last, and should not require frequent replacement the way barcode labels do.

Barcode tracking is designed for small businesses; RTLS tracking is scalable.
Barcode tracking is designed to operate on a given scale; meanwhile, RTLS is designed to operate for businesses of a variety of sizes. Barcode scanners are a practical solution primarily for small businesses. This is in part due to the fact that they are contingent upon manual input; for small businesses, it’s not a big deal to scan what passes through their doors, because it’s usually a lesser volume. It also works well for small facilities because although barcode scanners cannot account for misplaced assets when they have not been scanned, finding those misplaced assets should not be as difficult, as there are only limited places they could be.

RTLS tracking, however, is designed to be used across businesses of any size. Although the infrastructure requires a greater upfront cost, many of these systems are priced in a way that you only pay for what you need, driving implementation costs down for small businesses looking for a more sophisticated system. It also leaves room to expand the system as the company grows, letting you build your tracking solution alongside your company so you’re only ever paying for what you need. RTLS also provides added value to larger businesses that barcode scanning cannot. The system’s automated nature ensures that workers don’t need to spend time manually scanning every single container that enters the doors; it also allows operators to quickly identify the location of anything that’s been misplaced across the larger facility., which is beyond a barcode scanner’s capabilities.

RTLS tracking provides real-time visibility of movement throughout the facility.
One detail that many of these points keep alluding to is one worth addressing directly: RTLS is designed to provide real-time visibility in a way barcode scanning cannot. To drive the point home, barcode systems only provide location data for items that are scanned. Having an accurate location record is contingent on the item having been scanned properly every time it is moved between locations. This is far easier said than done, especially when workers are in a rush, labels are starting to fade, or scanners are low on power. It’s also easy to say, “I’ll put this back later, so there’s no need to scan it,” and then simply forget about the promise you made yourself. When this occurs, workers must manually search for missing inventory and simply hope they find it without wasting too much time.

RTLS is designed with the intention of directly addressing these kinds of problems. The goal is to provide visibility of inventory and other assets even in the worst case scenario. Something’s been misplaced? With RTLS tracking, there’s no problem, you just need to check the system to see where it is. After all, RTLS reads location either when assets move or at regular, set intervals. This ensures that even when something is left somewhere it shouldn’t be, the system retains visibility of that asset and accounts for where it is and what it’s doing. This means that you don’t have to spend time looking for lost assets; you can simply check the system and retrieve it from its last known location.

Is Barcode Scanning or RTLS Tracking Better?

The solution that’s best for you is largely contingent on your company’s priorities, needs, and budget. RTLS tracking provides more features and saves more time, but barcode scanning is generally regarded as the simpler and cheaper solution, so it’s favored by many small businesses. However, if your business is larger or looking to grow, RTLS tracking is going to be the better option for your company. Some of the key reasons were visited above, but there are others; let’s recap and add on.

1. RTLS is an automatic system. RTLS does not require worker input, which helps prevent issues of human error and ensures your employees are able to use their time for more important tasks.

2. RTLS requires minimal maintenance. After implementing the solution, you can simply let it run. Batteries only require replacements once every few years, saving you further time and money.

3. RTLS tracking solutions are scalable and affordable. You only need to pay for the infrastructure that you need, but you can always add more when your company’s scope and budget grow without upsetting what’s already in place.

4. RTLS provides real-time visibility. Even when your assets are misplaced, RTLS systems maintain location records and visibility. This means you can find what you need, when you need it, without having to initiate a time-consuming search.

5. RTLS is applicable outside of inventory tracking. The same RTLS system can also be applied to track WIP products, tools, equipment, and more. With added tags and infrastructure, it can even be used to track assets outside of the facility.

Affordably Track Your Inventory with Link Labs’ RTLS Solution 

Link Labs provides an affordable RTLS solution for inventory tracking through our AirFinder Onsite system. We let you choose the tags that suit your use case, so you’re only paying for what you need. With up to 30-centimeter accuracy, we can help you paint a picture of your inventory’s location across your facility with both accuracy and precision. And we can grow with you! As you gain more assets, you can purchase more tags without any required infrastructure expansion. To learn more about tracking inventory and more with Link Labs, book a demo with our experts today.

How Does WIP Tracking Compare to Inventory Tracking?

Written by Makenna Dudley

Makenna Dudley is a Marketing Associate for Link Labs, with practical experience in written communications, media writing, and additional forms of content creation. She has a bachelor's degree in Mass Communication.

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