How to Create Inventory Barcodes: Free Setup Guide

A barcode inventory system replaces manual counting and handwritten logs with scannable labels. You print a barcode on each item (or shelf, bin, or location), scan it with a phone or handheld scanner, and your inventory software records the transaction. No typing, no transcription errors, no squinting at smudged handwriting.

The good news: setting this up costs almost nothing. Internal inventory barcodes don't require GS1 registration (that's only for retail). You design your own codes, generate barcode graphics for free, and print labels on any standard printer. Here's how.

Which Barcode Format to Use

For internal inventory, you're not constrained by retail standards. Pick the format that fits your label size and data needs:

The Short Answer: Use Code 128

Code 128 is the right choice for most inventory systems:

• Encodes the full ASCII character set (uppercase, lowercase, numbers, symbols)
• Produces compact barcodes — about 30-40% smaller than Code 39 for the same data
• Read by every barcode scanner made in the last 30 years
• Handles numeric-only data at double density (two digits per symbol character)
• No registration required — encode any text you want

The only reasons to choose something else: your labels are smaller than 10mm (use Data Matrix), your existing system requires Code 39 (keep using it), or you want scannable links to a database (use QR codes).

Design Your Numbering Scheme

A numbering scheme is the system behind your barcode data. Good schemes are simple, consistent, and don't try to encode too much meaning into the number itself.

Recommended Approach: Prefix + Sequential Number

[Category Prefix]-[Sequential Number]

Examples:

Common Mistakes to Avoid

Don't encode too much meaning into the number. Codes like WH-BLUE-SHELF3-SM-001 seem smart but create problems: what happens when the item moves to shelf 5? Or the blue variant is discontinued? Keep the code simple and let your spreadsheet or database store the metadata.

Don't use random codes. Sequential numbers are easier to audit. If your highest number is WH-0247, you know you have 247 items in that category. Random codes make it impossible to spot gaps.

Don't make codes too long. Longer codes produce wider barcodes. Keep inventory codes under 15 characters for labels that fit on standard-size stickers. Under 10 characters is ideal.

Don't skip the prefix. Prefixes prevent collisions when different departments independently assign numbers. Without prefixes, warehouse item "0042" and IT asset "0042" produce identical barcodes.

Generate Your Barcodes

One at a Time (Free)

For small inventories or getting started:

1. Open our Code 128 Generator
2. Type your inventory code (e.g., WH-0001)
3. Download as PNG or SVG
4. Repeat for each item

This is practical for up to 50-100 items. Each barcode takes about 15 seconds.

Bulk Generation

For larger inventories, generating barcodes one at a time isn't practical. Options:

Spreadsheet + Label Software:

1. Create a spreadsheet with all your inventory codes (one code per row)
2. Use label design software (Avery Design & Print, Labeljoy, or BarTender) to import the spreadsheet
3. The software generates a barcode for each code and arranges them on label sheets
4. Print the entire sheet at once

Mail Merge with Word:

1. Create your inventory code spreadsheet
2. Set up a Word mail merge document using a barcode font (Code 128 fonts are free)
3. Print merged labels — each label gets a unique barcode

Dedicated Barcode Software: For ongoing inventory management (100+ items, regular updates), dedicated barcode label software like BarTender, NiceLabel, or ZebraDesigner connects to your database and prints labels on demand.

Print and Apply Labels

Printer Options

For most small businesses starting out, your existing printer with adhesive label sheets (Avery 5160, 5260, or similar) works fine. Upgrade to a thermal printer when you're printing more than a few dozen labels per week.

Label Materials

Label Size Guidelines

Keep your barcode at a readable size:

• Code 128: Minimum X-dimension of 0.25mm (10 mil). A 10-character code at this minimum produces a barcode about 35mm wide
• Data Matrix: Can be as small as 2mm × 2mm for short codes, but 10mm × 10mm is more reliable for phone scanning
• Quiet zone: Leave blank space equal to at least 10× the X-dimension on each side of the barcode

For barcode print quality verification guidelines, see our barcode quality verification guide.

Set Up Scanning

Option 1: Phone Scanning (Free)

Use our web-based scanner on any phone:

1. Open barcodescanner.online in your phone's browser
2. Tap "Scan with Camera"
3. Point at the barcode — the scanner decodes it instantly
4. Copy the result to your inventory spreadsheet or system

This works for occasional scanning. For step-by-step phone scanning instructions, see our phone scanning guide.

Option 2: Handheld Barcode Scanner ($30-200)

For daily scanning, a dedicated scanner is faster and more ergonomic:

• USB wired scanners ($30-60): Plug into a computer, act as a keyboard. Scanning a barcode "types" the code at the cursor position — works with any spreadsheet or software
• Bluetooth scanners ($60-150): Pair with a phone or tablet. Useful for mobile inventory counts
• Rugged scanners ($150-500): For warehouses, drop-resistant, long battery life

Option 3: Inventory Software + Scanner

For growing operations, pair your scanner with inventory software:

• Spreadsheet-based: Use Google Sheets or Excel. The scanner "types" the code into a cell, you add quantity and location columns
• Free software: InFlow, Sortly, or Stockpile offer free tiers for small inventories
• Full systems: If you outgrow spreadsheets, systems like Fishbowl, DEAR, or Cin7 integrate barcode scanning with purchase orders, sales, and reporting

Example: Setting Up a Small Warehouse

Here's a concrete example for a business with 200 products stored in a small warehouse:

1. Define Categories and Locations

Products:    PRD-0001 through PRD-0200
Locations:   LOC-A1-01 through LOC-D4-08  (Aisle-Shelf-Position)
Bins:        BIN-001 through BIN-050

2. Generate and Print Labels

• Product labels: Code 128 barcodes on 1" × 2.625" labels (Avery 5160)
• Location labels: Larger 2" × 4" labels (Avery 5163) for shelf edges
• Bin labels: Laminated cards with barcodes and bin numbers

3. Scanning Workflow

Receiving: Scan product barcode → scan bin location → enter quantity. Your spreadsheet now shows where each product is stored.

Picking: Look up the order, scan the product barcode at its location, confirm the pick. Reduces picking errors.

Counting: Walk through the warehouse, scan each bin barcode, then scan and count every product in that bin. Compare against expected inventory.

For a more detailed warehouse setup, see our warehouse barcode systems guide.

Scaling Up: When Internal Barcodes Aren't Enough

Internal barcodes work great for tracking your own inventory. But if your products need to be identified across other companies' systems — retail stores, marketplaces, supply chain partners — you'll need GS1-registered barcodes (UPC-A or EAN-13).

The transition isn't painful: you keep your internal Code 128 system for warehouse management and add UPC-A/EAN-13 codes for external-facing product identification. Many businesses run both systems in parallel — the internal code on the shelf label, the retail code on the product packaging.

For details on GS1 registration, see our guide on how to get a barcode for your product.

Related Guides

• Code 128 Complete Guide — full technical details on the most versatile inventory barcode
• Code 128 vs Code 39 — comparing the two most common linear formats for inventory
• Warehouse Barcode Systems — full warehouse implementation guide
• How to Get a Barcode for Your Product — GS1 registration for retail barcodes
• Free Barcode Generator Guide — all formats and output options
• How to Scan a Barcode on Your Phone — scanning instructions for iPhone and Android