What Is UPC Or a Universal Product Code

By
Nicole Georgiev
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Practically every product in your pantry or fridge has a UPC on it. It’s the barcode that is printed on the packaging. UPC stands for Universal Product Code. It differs from a SKU number lookup, which is also commonly known. Most items that are purchased from department stores, grocery stores, or other merchandisers have UPC barcodes on them. You might be wondering what is UPC and what it means.

We’ll help you fully understand universal product codes and how it differs from a SKU number

UPC barcodes are widely used for retail goods. It’s a way to identify products. There are different types of UPC barcodes out there and specific reasons why businesses might need them for order processing

You can break down UPCs by their product label. The label will typically have 2 different parts. The first is the barcode and the second is the unique number underneath. Barcodes consist of lines and black bars that are in a special sequence. In order to read the barcode, you’re going to need a barcode scanner. 

Each product will also have a unique numerical code consisting of 12 digits. This code is referred to as a Global Trade Identification Number or GTIN. Labels typically have a UPC barcode and a GTIN underneath. The UPC and GTIN is essentially the same except for the fact that the UPC is a barcode.

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What Is a UPC Code or UPC Number 

A UPC or Universal Product Code consists of a 12-digit barcode. It’s assigned to a product in order to easily identify it as well as its manufacturer. The barcode has numerous vertical variable-width bars. The original UPC was created in 1973 by IBM in order to track their merchandise in stores. Ideally, it was used at the point of sale. Since then, the UPC has spread to other countries. 

GS1 is an international non-profit organization. It maintains and regulates the UPC. They also work on developing supply-and-demand chain standards in numerous industries. 

The UPC is most frequently used in North America, but also worldwide for retail products and eCommerce. It can vary between 8 and 12 digits that identify each product during sales transactions.

What Is UPC and How Does It Work

Almost every consumer product that is sold in-store or online will have a UPC. It’s a machine-readable number or otherwise known as a barcode. It's an essential part of the order management system. The bars have spaces in between them that are unique to the product. 

Under the bars, there are between 8 and 12 digits based on the code. The first 6 to 10 digits indicate the manufacturer’s identification number. The following 1-5 digits indicate the item number. Finally, the last digit is the check digit. It guarantees the accuracy of the code. 

In today’s world, UPC barcodes are essential in standard sales transactions. Merchants use barcode readers to scan products at checkout. The reader will transmit the data from the UPC to the POS system in order to look it up. 

Once the POS system retrieves the information, it will get the price at the point of sale. This will allow the merchant to sell the product at a specific price. 

Most UPC barcodes are used for high-volume scanning. This is especially seen in retail stores. However, they can also be ideal for the healthcare industry. They can identify medical devices, be used for security, logistics, warehousing, and data tracking. 

Types of UPCs

UPC barcodes can vary based on their type. Here are the two kinds you might come across: 

UPC-A

This is considered to be the standard UPC. It’s used in POS retail transactions. This barcode has 12 digits and works on encoding data referred to as Global Trade Item Number or GTIN-12. 

UPC-E

Instead of the standard 12 digit barcodes, the UPC-E is 8 digits long. It also encodes GTIN-12 data. This barcode is typically used when there isn’t enough space for a 12-digit one. These can be found on smaller retail items like cigarettes, gum, and cosmetics. 

Do I Need to Have a UPC?

If your business sells physical products under a brand or label that belongs to you, you’ll likely need a UPC. This will help you identify each product in your inventory. Additionally, each product will have a specific variation of a unique barcode. 

UPCs might also be necessary if you sell products online based on the platform you use. Large retailers such as Walmart, Amazon, Google, eBay, and others request barcodes for their products. 

When it comes to scanning and tracking your inventory, UPC barcodes can come in handy. 

How to Get a UPC

Obtaining a UPC code isn’t as simple as it might seem. You’ll have to apply to GS1 for barcode issuing and maintenance. This organization makes sure that no two products use the same UPC code. 

If you’re in the U.S., here are the steps you have to follow to get a universal product code. 

  1. Go to the GS1 barcode application site and click on “Get a barcode” 
  2. Estimate the number of barcodes you need. This can depend on the product you have, the sizes it comes in, colors, and more. 
  3. Scroll to the bottom and click “Get a GTIN'' - this is for those who have one or a bunch of products. Click on “Get a GS1 company prefix” to get barcodes for various products at once.
  4. Insert your contact information and pay

The Cost of a UPC

Obtaining a barcode isn’t free. The cost of it can depend on the type of barcode you select. A one-time license for a GS1 US GTIN barcode costs $30. GS1 Company Prefix costs can vary. This is based on the number of items that you need a barcode for. In this case, there's an initial fee that can range from $250 to 2,100. Additionally, you’ll have a yearly fee between $50 to $2,100 in order to maintain the UPC registration with the GS1. 

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UPC vs. SKU vs. ASIN

When you ask yourself “What is UPC?”, you might think that it’s the same as a SKU or ASIN. However, these all differ from each other in one way or another. 

UPC

UPC barcodes resemble a standard barcode. It’s common for business owners to confuse them with other product numbers like SKUs and ASINs. 

SKU

A SKU is an internal product number. SKUs can incorporate letters and numbers. There is no limit on the length of these numbers. There are some businesses that choose to print SKUs over their UPC labels. This makes it easier to identify internal products. 

Inventory systems can be set up to automatically translate UPC barcodes into SKU numbers for your products. You can also use a SKU generator to create the number for you. To understand SKUs better, understand SKU rationalization.

ASIN

An ASIN is also known as an Amazon Standard Identification Number. This number is used specifically by Amazon. It can often be a variation of your product’s UPC barcode, but not always.

In Conclusion

A universal product code is essential for companies that are interested in understanding their sales. This can be through online marketplace selling or international trade. UPCs are more than just digits bunched together. 

A UPC barcode is tied to product information. They’re convenient and also very regulated. In order for you to obtain a valid UPC, you’ll have to apply for a GS1 company prefix. Even though the process isn’t as simple as it seems, it’s worth it. They can help keep track of products in a simple fashion. 

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