A barcode warehouse management system can make inventory movements faster, reduce manual data entry and give manufacturers better visibility into what is stored throughout their facilities.
A properly implemented barcode system for manufacturing connects physical inventory movements with transactions in Microsoft Dynamics 365 Business Central. Employees can scan materials as they are received, moved, consumed in production, counted, picked and shipped. This helps Business Central reflect what is actually happening in the warehouse and on the shop floor.
However, adding barcode scanners does not automatically solve every inventory problem. The underlying processes and data must also be accurate.
The important question is whether your operation has enough transaction volume, inventory complexity or risk of error to justify barcode technology.
In this article, we examine four reasons manufacturers consider a barcode warehouse management system, where scanning provides the most value and when fixing the underlying process should come first.
If you would like to discuss these concepts with Sabre Limited President Robert Jolliffe, you can book a one-on-one 30-minute call.
Dynamics 365 Business Central Warehouse Management is Full Featured
Microsoft Dynamics 365 Business Central includes strong inventory and warehouse management capabilities. Depending on how each location is configured, manufacturers can use simple inventory transactions or more structured warehouse documents and processes.
Out of the box, Business Central supports:
- Multiple locations, bins and zones
- Warehouse receipts and shipments
- Picks, put-aways and internal movements
- Transfers between locations
- Cycle counting and physical inventory
- Item variants and units of measure
- Lot and serial-number tracking
- Production consumption and output
A smaller manufacturer with relatively few transactions and clearly marked storage locations may be able to manage its inventory using these standard capabilities.
Business Central can also scan 1D and 2D barcodes through its mobile application on compatible devices. However, this should not be confused with a complete mobile warehouse solution.
A dedicated barcode system for manufacturing can guide employees through transactions and validate the item, bin, quantity, tracking number or order being scanned. Business Central maintains the inventory and production records, while barcode technology helps employees update those records accurately where the work occurs.
Whether a manufacturer needs dedicated barcode software depends on its transaction volume, warehouse complexity, traceability requirements and risk of inventory errors.
4 Reasons Why Manufacturing Companies Might Need a Barcode Warehouse Management System
#1 Reduce Stockouts Caused by Inventory Errors
Stockouts are especially disruptive when Business Central shows that a component is available, but employees cannot find enough of it to complete a production order.
A barcode warehouse management system can reduce these discrepancies by recording inventory transactions as materials move through the facility. Instead of relying on someone to remember the transaction or enter it later at a shared computer, employees can scan an item and its location while receiving, moving, consuming or shipping it.
This gives Business Central more timely information and reduces manual entry. However, barcode scanning only improves inventory accuracy when the underlying process is correct.
As we often say at Sabre, automating mistakes just allows people to make more of them faster.
If employees understand the required transactions but struggle to record them because the process is slow or inconvenient, mobile barcode scanning may be an effective solution. If they are following an incorrect process, adding scanners will not solve the problem.
Before investing in barcode technology, determine whether the inaccuracies come from missed transactions or more fundamental issues with inventory data and procedures. Correct the process first, and then use barcode scanning to make it faster and easier to follow.
#2 Prevent Lost or Misplaced Inventory
Inventory is not always truly lost when employees cannot find it. The material may exist somewhere in the facility, but Business Central shows the wrong location because a movement was missed or recorded incorrectly.
This becomes more likely when a manufacturer has:
- A large warehouse or production facility
- Multiple inventory locations
- Numerous bins, shelves or staging areas
- Materials that frequently move between departments
- Overflow inventory stored wherever space is available
- Work-in-progress moving between operations
- Similar items stored near one another
These requirements are especially common in make-to-stock manufacturing, where companies maintain raw materials, semi-finished goods and finished products across the operation.
A barcode warehouse management system creates a more controlled process. Employees scan the item, its current bin and its destination whenever inventory is moved. Business Central is then updated to show where the material should be found.
This is particularly valuable when the system directs put-away based on available capacity, item characteristics or warehouse rules. Employees do not need to remember the location or return to a computer later to record it.
Every relevant movement must still be scanned. If employees move inventory without completing the transaction, Business Central will become inaccurate regardless of the technology being used.
#3 Increase Warehouse Productivity
Warehouse employees lose time when they must walk to a computer, record transactions on paper or enter information after completing the physical work. These extra steps also make transactions easier to delay, forget or enter incorrectly.
A barcode system for manufacturing allows employees to record inventory activity where it happens. Using a handheld scanner, mobile computer, tablet or supported phone, they can scan information instead of manually typing item numbers, bin codes, document numbers, quantities and tracking details.
Barcode scanning can streamline:
- Purchase order receiving
- Put-aways and inventory movements
- Production staging
- Production consumption and output
- Lot and serial-number capture
- Inventory counts
- Sales order picking
- Shipping verification
The benefit increases with transaction volume. Saving a few seconds on one movement may not justify a new system, but saving that time across hundreds of daily transactions can make a meaningful difference.
Mobile scanning can also guide employees to the correct location and validate the information they enter. This reduces the amount they must memorize and helps newer employees work more confidently.
Every scan should serve a clear purpose. Unnecessary scans and complicated screens can slow employees down, so the system should provide the controls the manufacturer needs without adding avoidable steps.
#4 Reduce Picking and Shipping Errors
Manufacturers often stock products or components that look nearly identical but differ in material, finish, revision, voltage or another specification that is difficult to identify visually.
When employees rely on appearance, memory or a printed picking list, they can select the wrong product. The mistake may not be discovered until production begins or the order reaches the customer.
A barcode warehouse management system can validate the item during picking. If an employee scans the wrong product, the system can display a warning before the transaction is completed.
Barcode validation can confirm:
- The item and variant
- The quantity and unit of measure
- The lot or serial number
- The warehouse bin
- The related production or sales order
A final scan during packing or shipping provides another opportunity to verify that the correct products are being sent to the customer.
In LEAN manufacturing, this is a form of poka-yoke, or mistake-proofing. The process prevents an error or detects it immediately rather than relying on someone to find it later.
Not every manufacturer needs an end-to-end WMS to achieve this result. Targeted barcode validation during production staging, picking or shipping may address the company’s most expensive source of errors.
When a Barcode System Will Not Fix the Problem
A barcode system for manufacturing cannot compensate for inaccurate data or poorly designed procedures. Scanning the correct component will not produce an accurate inventory balance if the bill of material contains the wrong quantity. Likewise, scanning an item into a bin will not help if employees later move it without recording the transaction.
Before implementing barcode scanning, manufacturers should correct problems involving:
- Inaccurate bills of material
- Incorrect units of measure
- Missing or duplicate item records
- Poorly labelled warehouse locations
- Uncontrolled inventory adjustments
- Inconsistent production reporting
- Employees bypassing required procedures
Many of these issues need to be addressed through better data and procedures before scanning is introduced. Our guide to inventory control in Business Central explains several of the foundational practices manufacturers should establish first.
Manufacturers must also decide which events need to be scanned. Requiring employees to scan the same information repeatedly adds unnecessary work and may encourage them to find shortcuts. Each scan should identify an item, validate a decision or create a necessary transaction in Business Central.
Once the data, responsibilities and warehouse procedures are reliable, barcode technology can help employees follow the correct process more quickly and consistently.
Where Manufacturers Can Use Barcode Scanning
A barcode system for manufacturing can support inventory from receiving through production and shipment. The most useful scanning points are where inventory changes location, quantity or status.
- Receiving: Match materials to purchase orders and capture quantities, units of measure, lots, serial numbers and receiving locations.
- Put-away and movement: Confirm where materials are stored and record transfers between bins, warehouses or production areas.
- Production staging and consumption: Validate components picked for a production order and record the materials used.
- Production output: Record finished quantities, item-tracking information and destination bins.
- Inventory counting: Scan items or bins and enter quantities while completing cycle or physical counts.
- Picking and shipping: Confirm that the correct items, quantities and tracking details are selected before an order leaves the facility.
Manufacturers do not need to introduce scanning everywhere at once. Start with the transactions causing the greatest delays or most expensive errors, stabilize those workflows and then expand barcode scanning where it provides additional value.
Do You Need Basic Barcode Scanning or a Complete WMS?
Barcode scanning can mean anything from using a phone to identify an item to guiding every warehouse transaction through a dedicated mobile application. Manufacturers should choose the level of technology that matches the complexity of their operation.
| Approach | Best for | What it provides |
|---|---|---|
| Standard Business Central | Smaller warehouses with relatively few transactions | Inventory locations, bins, picks, put-aways, receipts, shipments and item tracking |
| Basic barcode scanning | Companies that need faster item identification or limited data capture | Scanning supported barcodes into specific Business Central fields and pages |
| Mobile warehouse application | Manufacturers with frequent inventory and production transactions | Guided workflows, mobile data entry, scan validation and real-time Business Central updates |
| Advanced WMS | Large or highly complex warehouse operations | More sophisticated automation, optimization, replenishment and warehouse control |
A smaller manufacturer with straightforward inventory may only need standard Business Central processes or basic scanning. Mobile warehouse software becomes more valuable when employees work away from shared computers, manage numerous bins, capture item-tracking details or validate frequent transactions.
An advanced WMS may be justified when the operation requires sophisticated replenishment, directed work, capacity management, automation or high-volume fulfilment.
The goal is to choose the simplest system that reliably controls the operation. Additional functionality increases implementation, training and process requirements, so it should solve a defined business need.
Frequently Asked Questions
Can Microsoft Dynamics 365 Business Central scan barcodes?
Yes. The Business Central mobile app can use the camera on a compatible phone or tablet to scan supported 1D and 2D barcodes. Manufacturers that need guided warehouse processes, broader transaction support or dedicated scanning devices may benefit from an integrated mobile warehouse application.
What is the difference between barcode scanning and a warehouse management system?
Basic barcode scanning captures information such as an item or lot number. A warehouse management system controls the broader workflow by directing tasks, validating scans and recording activities such as receiving, put-away, movement, picking and shipping. A manufacturer may need basic scanning without requiring a complete WMS.
When does a manufacturer need a barcode warehouse management system?
A barcode warehouse management system may be appropriate when employees complete a high volume of inventory transactions, manage numerous bins or locations, capture lots or serial numbers, struggle to locate materials or frequently experience picking and shipping errors. The potential cost and operational impact of those problems should justify the additional technology.
Can barcode scanning prevent inventory errors?
Barcode scanning can reduce errors caused by manual entry, incorrect item selection and missed transactions. It cannot correct inaccurate bills of material, units of measure, item records or warehouse procedures. The underlying data and processes must be reliable for barcode scanning to produce accurate results.
Can barcodes track materials used in production?
Yes. An integrated barcode system can identify components staged or consumed for a production order and record finished output. Depending on the software and configuration, it may also capture quantities, bins, lot numbers and serial numbers to support inventory accuracy and traceability.
Do manufacturers need barcode scanning for lot or serial-number tracking?
Business Central can manage lot and serial-number information without barcode scanners. However, scanning can make item-tracking details faster to capture and reduce manual entry errors, particularly when employees process high transaction volumes or long identification numbers.
What equipment is needed to implement barcode scanning?
Requirements may include barcode labels, label printers, handheld scanners, mobile computers, tablets or compatible phones. Manufacturers also need software that connects scanning activity with Business Central. The appropriate equipment depends on the environment, barcode format, transaction volume, connectivity and durability requirements.
Choose the Right Level of Barcode Control
A barcode warehouse management system can help manufacturers improve inventory accuracy, locate materials, increase productivity and prevent picking or shipping errors. The value is highest when employees complete a large number of transactions, work across numerous inventory locations or must capture detailed lot and serial-number information.
However, barcode technology is not a substitute for accurate data and disciplined warehouse procedures. If bills of material, units of measure, inventory locations or transaction processes are incorrect, scanning will simply record those problems more efficiently.
Start by identifying where inventory errors occur and which manual steps consume the most time. Some manufacturers only need barcode validation during picking or shipping. Others benefit from mobile scanning throughout receiving, put-away, production, counting and fulfilment. Large or highly complex operations may require a more advanced WMS.
The right barcode system for manufacturing should make correct transactions easier for employees while giving Business Central a more accurate view of inventory activity.
Need Some Help?
Sabre Limited can help you assess your inventory and warehouse processes, determine where barcode scanning would provide value and select the appropriate level of integration with Microsoft Dynamics 365 Business Central.
Contact our team to discuss your warehouse management and barcode requirements.
