RFID vs Barcodes in Retail: When to Use Each — and How to Combine Them

The choice between barcode scanning and Radio Frequency Identification (RFID) technology is often presented as an either/or choice for retailers.

While both technologies are familiar and widely used in retail, each offers distinct abilities and works well with the other in combination to bring significant benefits when used appropriately. The concept of RFID vs barcodes can therefore be a distraction, while RFID with barcodes is the more practical and productive option.

What’s the real difference between RFID and barcodes in stores?

The key difference is that barcodes require line‑of‑sight and are traditionally scanned one‑by‑one, RFID reads many items at once without line‑of‑sight over several meters:

• Barcodes (1D/2D) are standardized by GS1, almost every product carries a barcode (typically UPC, EAN, or QR) and they are universally supported at checkout. Two‑dimensional codes and GS1 Digital Link also connect scans to web resources for richer product info.
• RFID uses readers (fixed or handheld) to capture many tags simultaneously for fast cycle counts, goods‑in verification, and item finding - without line‑of‑sight.

When should retailers use RFID?

Retailers can deploy RFID wherever they need rapid, aggregated counts and movement telemetry - it’s a pragmatic choice for retail operations tasks, such as inbound receiving, stockroom‑to‑floor transfers, cycle counts, and online order picking.

RFID tags are fixed to individual products and transmit encoded information read by dedicated reader hardware:

• These reader units can be fixed or mobile.
• If reader units are fixed at the goods entrance to individual stores and between the stockroom and the shopfloor then the location of products can be automatically recorded and updated as they move.
• By quickly receiving goods or stock counting, retailers get real-time oversight on precisely what they have in store.

RFID technology works well when an aggregated view of inventory is required. It can be used as a method for quick cycle counting and for inventory counting as it arrives at, or leaves a location – especially in busy departments when lots of deliveries arrive at the same time.

Crucially, it copes well with scale. With fixed and mobile readers, counting more items doesn’t require any more effort than counting just a few. Tracking and traceability are key benefits of this approach.

What are the benefits of RFID in retail operations?

• Speed & throughput: Modern sleds can read 1,300+ RFID tags per second, cutting cycle‑count times when deployed effectively.
• Accuracy: GS1 cites >95% item‑level accuracy in well‑implemented programs
• Range: Multi‑meter reads (environment‑dependent) let associates find items on densely merchandised fixtures.

Within large stores, the tags can help narrow down where items are located if they need to be picked for online orders, and RFID signals are a popular choice for anti-theft alarms in fashion retail. Point-of-sale readers can record when tagged items leave stores legitimately, too.

Because RFID technology – unlike barcode scanning – does not require a line of sight to register a product, it can be useful for folded items such as clothing, where barcodes may not be easily visible without searching.

This is one of the reasons that RFID has been so popular in the fashion sector.

What are RFID’s limitations - and how do you mitigate them?

The limitations for retailers assessing RFID technology include the added per‑item tag cost, supplier onboarding requirements, RF design, and that it can be affected by metal/water.

Ultimately, RFID tracking requires tags to be attached to products at the source. For retailers that stock a wide array of brands, it becomes a challenge to include RFID tags across the supply chain if not done already.

Also, the installation of RFID systems can be costly and complex, although this can be mitigated with the right inlays, placement, and testing. However, they also need to be updated regularly, so this remains a key consideration for retailers.

Radio signal interference can be an issue too, with the presence of water or a lot of metallic objects nearby interrupting signals, for example, and this can cause a fall in accuracy.

Barcode scanning in retail: near-universal compatibility

Barcodes have been used in retail for more than half a century and have been universally adopted.

All retailers have the technology to read and understand them, and all manufacturers are used to putting them on products. It is difficult to find a product that does not have a barcode.

Why are barcodes still essential in retail in 2025?

Barcodes are a well-established, universal technology. They are cheap to print, perfect for POS and consumer scanning - and the industry is migrating to 2D at POS by 2027 (GS1 “Sunrise 2027”).

What’s new in barcodes:

• 2D codes at POS enable more data and experiences (e.g., GS1 Digital Link to web content).

Pretty much every stage of a product’s journey will see it passing devices that are able to scan a barcode. It is accurate, simple and does not require dedicated devices. For inventory tasks, a barcode scanner for inventory offers retailers a cost-effective solution to manage stock efficiently. This improves accessibility for individual workers and decreases the cost to retailers.

Modern smart data capture technology means that barcodes can be used to provide many layers of product information, even allowing consumers to scan codes and discover product attributes via augmented reality with a smartphone. The growing popularity of self-scanning in supermarkets highlights how familiar consumers are with the humble barcode.

However, line of sight is required to read barcodes, and this can be time-consuming at scale. Even with boxed goods, simply ensuring they are all facing in the same direction can require time and effort. With folded or irregularly-shaped products, this can become a headache.

How do RFID and barcodes work best together across the store?

Use RFID as the truth layer for inventory and movement, expose that truth to associates and customers via fast, ubiquitous barcode/2D scans.

All of these factors mean that RFID and barcode scanning are ideal complementary technologies. Working together they can yield greater accuracy, speed and utility, each providing checks and balances to the other.

With omnichannel retail the new norm, delivering a consistent and elevated customer experience relies in part on accurate and timely data. Using RFID to batch read inventory can ensure the required speed and provide an up-to-date single source of the truth.

That data can then be accessed by workers and customers in store by scanning barcodes. Facilitating services like Buy Online Pickup In Store (BOPIS) or Ship from Store when an item isn’t immediately available.

It’s crucial for order fulfillment too, ensuring items purchased online are actually available.

Not only is the core tech complimentary but the physical devices used can give workers everything they need to provide great customer service that ties into a retailer’s brand image.

Selecting the right devices for RFID and barcode scanning

Bulky and expensive RFID readers aren’t designed to be carried around all day. So sharing them between workers for infrequent receiving and stock checks makes sense. For other tasks, having a smaller and more flexible smartphone in their pocket allows workers to seamlessly switch between the back and front of the store and assist customers without having to leave their side. Smartphones are also sleek and can be tailored to the brand image the retailer wants to convey.

While each offers useful, accessible features that can combine to allow more accurate, efficient running of stores – it is also relevant that both technologies already exist, and neither is going away.

Virtually every product features a barcode; the vast majority of logistics networks use RFID.

For retailers where RFID is within their control, potentially investing in it requires serious thought, especially when the two technologies can be integrated so successfully.

Retail contains a wide variety of store formats, locations, product sectors and styles. It demands a wide range of technologies to meet modern consumer expectations.

Like a traditional toolkit, a retailer’s technology stack needs the right tools for every occasion and some – like a hammer and a chisel – are far more helpful when used together. That is certainly the case for the RFID vs barcode scanning debate as the technologies can work together to give retailers far better visibility of their operations.

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FAQ

Will RFID replace barcodes in retail?

No. RFID and barcodes serve different but complementary purposes. RFID is ideal for bulk inventory tasks such as cycle counting and goods-in checks, while barcodes remain essential for point-of-sale transactions and customer interactions.

When should retailers use RFID?

RFID is best for high-volume, back-of-store processes where speed and accuracy are critical. Examples include verifying inbound shipments, moving items from the stockroom to the sales floor, and conducting regular cycle counts.

Why are barcodes still essential in stores?

Barcodes are already printed on nearly every product and universally supported at checkout. By 2027, retailers worldwide will be ready to accept 2D barcodes (as part of “Sunrise 2027”), enabling even richer product data and digital experiences.

How accurate is RFID compared to barcode scanning?

Modern RFID systems can achieve over 95% item-level inventory accuracy and read more than 1,000 tags per second, making them much faster than manual barcode scanning for bulk tasks.

What are the main challenges of using RFID?

RFID adoption can be limited by per-item tag costs, supplier onboarding, and technical challenges such as interference from water or metal. Retailers can mitigate these with careful RF design, testing, and optimized tags.

How can RFID and barcodes work together?

The most effective strategy is a hybrid approach: use RFID to maintain a real-time, store-wide view of inventory, while also using barcodes to provide a complementary and additional layer of data and accuracy for store operations. Continue to use barcodes or 2D codes for customer-facing tasks like checkout, self-scanning, and product information.