Table of contents:
Colour coding has long been a practical method for improving the distinctiveness of otherwise similar-looking items, thereby reducing the likelihood of handling errors. It is particularly suited to returnable containers, which are available in various colours—unlike standard cartons, which tend to be brown unless specifically custom-printed. Nevertheless, there are several limitations to consider:
These limitations are significant enough that some manufacturers conclude colour-coding is not worth the effort. Customers typically dictate labelling requirements. Ford, for instance, mandates hot stamps on two sides of every container, including the following details:
Despite these permanent identification marks, the actual information presented on container labels varies considerably. In addition to the stamped data, containers also carry adhesive labels indicating the parts they contain. If the kanban system is in use, they may also feature a plastic pocket or similar device for holding a kanban. This pocket can also accommodate other cards. For example, a backflash card is sent to Accounting, while a traveller card goes to Quality Assurance.
Attaching such a card pocket to plastic totes is relatively simple, but doing so with other container types—like wire baskets—can be more difficult. Implementing a card-based kanban system often involves finding attachment methods that are both secure and easy to use. Alternatives to traditional card pockets include Velcro, magnets, or clips similar to those used for attaching ID badges to clothing.
Wall signage and marked storage locations also help guide the correct movement of containers. As with any visual management system, the effectiveness of signage relies on its visibility and ongoing accuracy. If even a small number of signs are incorrect, it undermines trust in all signage among materials handlers and operators.
The number of containers in each state can be gleaned from data already collected through basic production control transactions. In routine operations, the number of containers at the customers, in transit, or at the suppliers should vary within bounds around an average, and large deviations can be used as early warnings of shortages. Also, the average number of times containers are reused before being scrapped can be inferred from this data. In steady-state, we have:
Container life expectancy = Number of containers in circulation / Scrap rate
If the supplier scraps five containers every month out of 50 in circulation, then on average, a container lasts 10 months. If the supplier shops 500 boxes per month, then each box makes 10 round trips per month or 100 round trips in 10 months. We know then that a box is reused 100 times on average.
Track-and-trace is the process of identifying past and current locations of items. "Track" is identifying where an item is located just now; "trace", the ability to identify where it has been. If tracking is done well and the data is stored appropriately, traceability follows.
Tracking individual containers is usually not worth the trouble if it requires manual data entry. However, items become easily tracked if fitted with an auto-ID technology such as barcodes, 2D barcodes, Bluetooth radio technology, or radio-frequency identification (RFID) tags.
Barcodes and 2D codes—such as QR and DataMatrix—enable semi-automated data capture using handheld or fixed-position readers. Printed codes can be easily affixed to parts, products, packaging, or transport carriers to facilitate tracking and tracing throughout the supply chain. However, since barcodes do not automatically communicate their location, readers must be installed or used at every point where data needs to be collected.
The term "barcode" generally refers to both 1D and 2D formats, although only 1D codes exhibit the familiar striped pattern. Multiple barcode standards exist.
Compared to manual data entry, barcode systems significantly increase accuracy and reduce the time spent on input and error correction. Even experienced typists make an error roughly every 300 keystrokes. Barcodes offer high reading accuracy, are straightforward to implement, and are generally cost-effective. However, they must be printed at high quality and scanned individually in clean, well-lit conditions. Since they are physical prints, they are susceptible to wear and damage. They are also limited in the volume of data they can store.
Barcodes are typically ink-printed onto adhesive labels or directly applied via laser or inkjet printing onto the product. For DataMatrix, the code is printed on a part of the product that will remain untouched during processing, ensuring traceability. This allows each item to be uniquely identified and tracked throughout the production process. The codes can also be linked to transportation carrier IDs used in logistics.
A barcode system includes the code itself, scanners, and supporting IT hardware and software. Industrial-grade 1D barcode printers generally cost around $1,000, while small-scale printers for less demanding environments are available from about $50. Scanners fall into the same price range, depending on functionality and durability.
RFID enables the simultaneous reading of multiple units and does not require a visual line of sight to access the tag. RFID tags are sometimes referred to as "smart barcodes." While not truly intelligent, they do offer a key advantage: they can be read without any manual intervention. When an RFID tag enters a reader's range, it automatically transmits a signal that essentially says, "Here I am, and here's my data." The RFID system operates through the transmission and reception of information via an antenna and a microchip. The microchip on the RFID tag is programmed with whatever data the user chooses to store.
There are two types of RFID tags: active and passive. Passive tags are the most widely used. They rely on energy received from the RFID reader to send a signal back. When outside the range of the reader, these tags remain inactive and do not transmit any data. Passive RFID tags are very low in cost—some as inexpensive as $0.10 each—and are often available in the form of adhesive rolls.
Active RFID tags, in contrast, contain their own battery, which allows them to continuously broadcast information. This battery makes them bulkier and more expensive than passive tags. They also require ongoing maintenance but offer the benefit of longer transmission ranges. The design of active RFID tags is generally larger and more robust than that of passive tags, making them suitable for more demanding or long-range applications.
The Global Trade Item Number (GTIN) is a standardised identifier used globally to uniquely distinguish trade items, such as products and services, in the supply chain. Administered by GS1, a non-profit organisation that sets global standards for business communication, the GTIN serves as the foundational element for identifying products in retail, distribution, and logistics. GTINs are typically encoded in barcodes and are essential for accurate product tracking, inventory management, and data sharing between trading partners.
GTINs can vary in length—commonly 8, 12, 13, or 14 digits—depending on the product type, packaging level, and regional standards. For instance, GTIN-12 is primarily used in North America and corresponds to the UPC code, while GTIN-13 is widely used internationally and aligns with the European Article Number (EAN). The GTIN-14 format is used to identify trade items at higher packaging levels, such as cases or pallets, and can encapsulate information about product hierarchies or variants.
Each GTIN includes a company prefix, an item reference number, and a check digit to ensure data integrity. The number itself does not carry product information; instead, it links to a database where product attributes are stored. This allows systems to retrieve consistent and reliable information about an item, such as its name, brand, size, and weight.
In modern supply chains, GTINs are crucial for enabling automated checkout, e-commerce listings, global product authentication, and traceability. They support regulatory compliance and streamline data exchange in industries such as food, healthcare, apparel, and consumer electronics..
Advanced intralogistics refers to the integrated management of materials and goods within a facility using a combination of physical organisation and digital technologies. It includes visual tools like colour-coded containers, barcode systems, RFID tags, and real-time data capture to streamline the movement, storage, and tracking of items. The goal is to improve operational efficiency, reduce handling errors, and provide better visibility into inventory and container flows.
In environments where hundreds or thousands of returnable containers circulate between suppliers, production, and customers, tracking becomes essential to avoid shortages, delays, or excess stock. Knowing the quantity and location of each container helps prevent losses, ensures timely replenishment, and allows for predictive planning. Accurate tracking also supports cost control by extending the usable life of containers and reducing the need for replacements.
RFID (Radio-Frequency Identification) allows for automatic, contactless identification of containers without requiring direct line-of-sight, enabling fast, hands-free data collection. When paired with Real-Time Locating Systems (RTLS), RFID technology provides continuous, precise location data of moving assets within a facility. This combination ensures full traceability, supports dynamic inventory management, and enables faster response to process disruptions, all of which contribute to a more resilient and efficient intralogistics system. (read more about RFID for asset tracking).
Managing intralogistics with hundreds of returnable containers demands more than visual tools like colour coding and labels, which, while helpful, have clear limitations. To ensure full transparency and efficiency, digital systems are essential. RFID technology plays a key role by enabling automated, line-of-sight-free identification of multiple containers at once, significantly reducing manual effort. When combined with Real-Time Locating Systems (RTLS), RFID goes a step further, offering continuous, accurate visibility of container movements throughout the facility (see: RTLS asset tracking system). This integration supports seamless tracking, improves traceability, and helps manufacturers respond faster to disruptions, shortages, or imbalances in container circulation.
Delve deeper into one of our core topics: Real time locating system
An ID badge is a form of personal identification typically worn on clothing, used to display an individual’s name, photo, job title, and affiliation within an organisation. It serves both as a visual identifier and as an access control tool when embedded with technologies like RFID or magnetic stripes. ID badges are widely used in workplaces, hospitals, schools, and secure facilities to verify identity and grant access to restricted areas. (3)
References:
(1) Baudin, M. & Netland, T. (2023). Introduction to Manufacturing. An Industrial Engineering and Management Perspective. Routledge.
(2) Frazelle, E. H. (2002). World-Class Warehousing and Material Handling. McGraw-Hill.
(3) Gonzalez, J.J. (2013). Corporate Security in the 21st Century: Theory and Practice in International Perspective. Springer.
Note: This article was partly created with the assistance of artificial intelligence to support drafting. The head image was generated by AI.