Frequently Asked Questions about GS1: The Global Language of Business
Published On: May 2, 2022
Author: Elizabeth Korda
Q: Who is GS1 US? What is its history and why are they significant today?
A: GS1 USis part of one of the largest identification and standards organizations in the world. Best known as the administrator of the U.P.C. barcode, GS1 US maintains and advocates for the use of a host of other data standards that support the supply chain. As a global, not-for-profit organization, GS1 helps companies uniquely identify products, locations, and other assets, and share information about them with trading partners and consumers in a consistent way. Additionally, the organization collaborates with a variety of industries to develop best practices for efficient supply chains, effective business relationships and providing consumers access to trustworthy information about the products they buy.
Q: What info can be retrieved from the barcodes?
A: Think about the barcode as a symbol for encoded information. The barcode is the machine-readable data carrier that embeds information and is just one part of the GS1 system of standards, which is composed of three primary areas: “identify, capture, and share.”
Identify: The GTIN (Global Trade Item Number) is the backbone of the entire system and is a number that identifies products, also known as trade items or anything that can be bought or sold.
Capture: The barcodes, the actual black lines and spaces, are data capture mechanisms that allow the encoded numbers to be read by machines. When a UPC barcode is scanned at the point of sale, the brand selling it will be able to trace their sales data and know how many products were sold. Specialized barcodes also support good inventory management and supply chain visibility practices, as they help record where a product is in the supply chain, which is helpful in the event of a product recall.
Share: GS1 standard formatting is essential to sharing data electronically in the supply chain, too. EPCIS, ASNs and XML are standards that enable data to be shared in a consistent way. Think about something as simple as a date format – there could be confusion about whether you use 04-25-22 or 25-04-22 to note April 25, 2022. GS1 standards ensure every system speaks the same language.
Q: Is there such a thing as a non-GS1 code that is used? And who is using them and in which industries? What are the risks of not using a GS1 code?
A: While there are third-party barcode companies that allow a business to simply purchase barcodes and the identification numbers encoded in them, many retailers and marketplaces require companies to purchase authentic identification numbers that specifically link a brand to the product being sold.
Purchasing barcodes or GTINs from a source other than GS1 may mean a company is labeling its product with another company’s identification number—a short term solution which can cause confusion with retail partners, lead to unnecessary costs associated with relabeling products, result in hidden online product listings and hinder company’s speed-to-market and growth.
Q: Please explain the process of getting a barcode (GTIN, UPC, GS1, GLN, 2D barcodes, and SSCC). How much does it cost? What factors go into deciding the cost?
A: Based on which barcode is required for your product, GS1 US’ estimator tool and resources will outline the process of obtaining a barcode that suits your business. The first step in the process is determining how many barcodes you need – you will need a different GTIN for each variation of your product. For example, if you have assorted color shirts in varied sizes, you will need a barcode for each color in each size.
Once you know how many you need, there are two options to obtain your GS1 barcodes. If you have a small business and only need a few barcodes, then you may want to license a single GS1 US GTIN for $30 and get a free subscription to GS1 US Data Hub, an online tool you can use to create your own barcode and manage your product data. There is no annual renewal fee for an individual GS1 US GTIN.
Alternatively, if you own a company with growing product lines, obtaining a GS1 company prefix might be the best route. When licensing a GS1 Company Prefix, you determine your capacity for barcodes. You will receive a company prefix, which is the first few numbers of your GTINs or barcode numbers, and then you assign the appropriate amount of GTINs according to your product line. In addition, you will also receive access to the Data Hub Product tool where you can create and manage your barcodes, as well as maintain product data associated with those GTINs. This company prefix option requires an initial fee and an annual renewal fee based on how many barcodes you are licensing. Please reference the chart below for the pricing model:
After evaluating which barcode purchasing option works best for your business, the next step is providing your contact information and processing payment (GS1 US also equips you with a W-9 form for tax purposes). After the transaction is complete, sellers will receive a certificate of ownership for their company prefix and GTINs.
Q: What is in it for an e-commerce business owner (seller)? Why should they use GS1 US?
A: There are several reasons to purchase barcodes from GS1 US for your business. Online marketplaces like Amazon recognize the importance of product information to the shopper’s experience. Some shoppers today will abandon the online shopping experience if they can’t find the information they are looking for. With the proper unique product identification, a product can be surfaced in more search results, leading to increased sales and loyalty. Online marketplaces are also more likely to work with brands long-term if they can ensure consistency between a product’s physical and digital presence with proper GTIN usage.
Product identification is required in more than 25 Amazon product categories. Seller Central provides guidance on when products may be exempt, or if multipacks or bundles require additional GTINs. Amazon requires that each sellable unit have its own GTIN, including bundles (a grouping of similar hair accessories, for example) or multi-packs (such as a multi-pack of 4 boxes of crackers). It is important to become familiar with Amazon’s rules for each, as there are specific items that are prohibited from being bundled or featured in a multi-pack, and product listings must contain specific information about the contents of these groupings.
Leveraging GS1 Standards can also help sellers prove they are the rightful owners of a product listing in the event their listings are ‘hijacked’ on Amazon. Hijacked listings usually result from two actions. Occasionally, bad actors posing as legitimate sellers can steal a company’s product listing, claim it as their own, and collect sales earnings for products that are never shipped. Also, some sellers looking for a shortcut around the marketplace’s GS1 Standards requirements will just put in whatever GTIN they can find without any concrete knowledge of how unique identification works.
Listings that are ‘hijacked’ in either way should be immediately reported to Amazon. They will ask the seller to prove they are the rightful owner of the product in question by providing a GS1 Company Prefix or GTIN ownership certificate that effectively demonstrates the link between the company and the product via the GTINs assigned to those products. To verify ownership, Amazon will check the GTINs in the GS1 Company Database (GEPIR®), which is the database of all the companies that have registered GTINs.
Q: How much time can be saved by using GS1 US instead of another option?
A: Everyone is looking to save time and money; however, investing time and effort into getting the proper barcodes for your product will save you time, money, and stress in the long term. As GS1 Standards are the most widely accepted across the world of commerce, leveraging those identifiers will help ensure that your business can get to market as quickly as possible. If you bought a third-party barcode, it may be likely you will have to relabel your product with a GS1 barcode. Getting started on the right foundation with GS1 barcodes from the beginning streamlines this process and saves time.
GS1 US offers a typical e-commerce store transaction when you opt for the single GTIN–you will receive your GTINs instantaneously. Similarly, when you license a GS1 Company Prefix, you can start assigning GTINs right away in the GS1 US Data Hub tool. This will also provide instructions on how to create and manage your own barcodes with each step. Overall, getting barcodes from GS1 US should be viewed as a long-term investment in your company’s growth.
Q: What is on the horizon for GS1 US?
A: In the next five years, all GS1 organizations are supporting the global retail industry’s effort to transition from the traditional UPC barcodes to more robust two-dimensional barcodes, such as QR codes. These data carriers will not only support the price look-up function at retail point-of-sale, but will also be able to hold much more information that is becoming valuable to the consumer such as expiration date, origin of the product, how it was made, detailed ingredients, and if it aligns with your values/preferences: gluten-free, vegan, keto, paleo, halal, silicone free, cruelty free, etc. This ongoing initiative, called Sunrise2027, is currently underway with various testing and preparations with major brands and retailers. Small businesses who are interested in being transparent with their consumers about how products are made should be aware of this major change in the retail industry and be on the lookout for updates from retail partners in the coming years.
GS1 US and the GS1 system of standards are recognized and accepted globally. And like ShipSage, GS1 US caters to businesses big and small. By using these universally accepted GTINs, your product/business will have a solid foundation for growth. Transitioning your products to GS1 barcodes, or starting off with them in the first place, is a worthwhile and wise investment to help ensure the security, and stability of your business.
Our thanks to Kaitlin Friedmann, Marketing Director, Small Business Growth, GS1 US, for contributing to the responses to these questions. Connect with her on LinkedIn for updates on GS1 US small business resources and for more information, please visit www.gs1us.org.