What Is the Universal Product Code (UPC)? Definition & Examples of the Universal Product Code (UPC) By Susan Ward Susan Ward Twitter Susan Ward wrote about small businesses for The Balance for 18 years. She has run an IT consulting firm and designed and presented courses on how to promote small businesses. learn about our editorial policies Updated on December 7, 2020 In This Article View All In This Article What Is It? How the UPC Works Types of UPC Barcodes Do I Need a UPC Barcode? How to Get a UPC Barcode How Much Does a Barcode Cost? Photo: Image Source / Getty Images The Universal Product Code, or UPC, is a widely used product identification system for retail goods. Learn how the UPC works and the main types of UPC barcodes, as well as whether your business needs them and how to get them. What Is the Universal Product Code (UPC)? The UPC is a product identification system used for retail products worldwide, but most commonly in North America. An eight-to-12 digit number known as a UPC or a UPC code is assigned to each product to identify it during sales transactions. How the UPC Works Nearly every consumer product sold at physical or online retailers worldwide contains a UPC barcode, which by definition consists of a number known as a UPC alongside a graphical, machine-readable version of the UPC known as a barcode. The barcode itself comprises a set of bars or lines with spaces between them. The number is between eight and 12 digits, depending on the type of code. The first six to 10 digits represent the manufacturer's identification number, the next one to five represent the item number, and the final digit represents the check digit, which ensures the accuracy of the code. The Universal Product Code was the first system of barcode labeling to be widely adopted. The grocery industry first established UPC as the standard barcode symbology for product marking in 1973. Foreign interest in UPC led to the adoption of the EAN code format, a format similar to UPC, in 1977. Today, UPC barcodes play an integral role in a typical sales transaction: A merchant uses a barcode reader to scan the UPC barcode of a product at checkout.The barcode reader transmits the UPC data to a point-of-sale (POS) system and looks up the number.The POS computer automatically retrieves information about the product, including its actual price at that point in time, enabling the merchant to sell the manufacturer's product at a reasonable price. Although UPC barcodes are particularly suited for high-volume scanning environments such as retail stores, it's not just retailers who use them for identification. They may be used in the health care industry to identify medical devices, for example. The barcodes are also used for logistics, data tracking, and security. Note A packet of chewing gum was the first product to have a UPC barcode scanned in a retail store, in 1974. Types of UPC Barcodes There are two kinds of UPC barcodes: UPC-A: This is the standard UPC version that is widely used for point-of-sale retail transactions. It's 12 digits long and encodes a type of data called Global Trade Item Number (GTIN-12). It's used broadly for retail products, including privately owned products sold exclusively at one merchant's stores. UPC-E: This shortened version of the UPC is eight digits long. Like UPC-A, it encodes GTIN-12 data, but it's generally used when there isn't enough room for the 12-digit code. As such, you'll most often see it on small retail items, such as cosmetics, gum, and cigarettes. Note Europe uses a different barcode system called the European Article Number (EAN) system, which itself comes in the EAN-13 and EAN-8 versions. The former is 13 digits long, and the latter is eight digits long. To ensure global conformity of the EAN/UPC numbering system, the Sunrise 2005 initiative mandated that all North American retailers must be capable of scanning EAN-13 symbols, in addition to UPC symbols. Do I Need a UPC Barcode? Businesses that offer physical products for sale using a brand name or label that belongs to them generally need to have a UPC barcode to identify each product. Moreover, each variation of each product should have a unique barcode. If you plan to sell products online, it's still prudent to use UPC barcodes, though the requirement will depend on the platform on which you plan to sell your products. You can obtain this information in the vendor requirements documentation of your chosen platform. Barcodes are requested by most large online retailers, including Amazon, eBay, Alibaba, Google, and Walmart. That said, you don't necessarily need a UPC barcode if you're selling products online through your own e-commerce website, at a small retailer that doesn't use a POS system (a mom-and-pop shop, for example), or a flea market or pop-up shop. Beyond that, UPC barcodes are handy for scanning and tracking your products as they move through the supply chain. How to Get a UPC Barcode Organizations that wish to use a UPC code must apply to GS1, a non-profit organization that maintains global standards for the identification of goods and deals with bar code issuance and maintenance. Having a single organization issue UPC codes ensures that no two products can have the same UPC code. To get a UPC in the U.S., you'll typically have to: Click "Get a barcode from GS1 US" on the GS1 barcode application website. Estimate how many barcodes you need. For example, you'll need nine barcodes if you plan to sell one shirt that comes in three sizes and three colors. Make it 27 barcodes if that shirt comes in three separate styles, sizes, and colors. At the bottom of the page, click "Get a GTIN" to get a GS1 US GTIN (ideal if you have one or a handful of products) or click "Get a Company Prefix to get a GS1 Company Prefix (good if you need to get barcodes for myriad products simultaneously). Supply your contact information. Pay. You'll receive an email with all the information you need to get started with using the barcode. How Much Does a UPC Barcode Cost? It depends on the barcode option you select. A GS1 US GTIN costs $30 one time to license. Costs for GS1 Company Prefixes depend on the number of items that need a barcode; there's an initial fee ranging from $250 to $2,100, plus a yearly fee of $50 to $2,100 to maintain UPC code registration with the GS1. Key Takeaways The UPC is a product identification system used for retail products worldwide, but most commonly in North America.An eight-to-12 digit UPC along with a barcode together make up a UPC barcode, which appears on virtually every retail product. When a UPC barcode is scanned at checkout, price data for the product is retrieved to facilitate a sale.Both UPC-A and UPC-E barcodes are used, but the former is more widely used for retail POS transactions; the latter is used for small retail items.Businesses that sell goods in a store should use UPC barcodes, but they're also requested for online sales on numerous platforms.UPC barcode costs range from $30 one time for a GS1 US GTIN to between $250 and $2,100 initially for a GS1 Company Prefix, plus an annual fee. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. GS1 US. "Build a Sample U.P.C. Barcode." Accessed Dec. 7, 2020. GS1 US. "Our Mission and History." Accessed Dec. 7, 2020. GS1. "How We Got Here." Accessed Dec. 7, 2020. GS1 US. "GS1 Barcode Chart," Page 1. Accessed Dec. 7, 2020. GS1 US. "Standards Guidance for Assigning DIs Using Global Trade Item Numbers (GTINs)," Page 8. Accessed Dec. 7, 2020. GS1 US. "Get Your U.P.C. Barcodes from GS1 US." Accessed Dec. 7, 2020. GS1. "Get Unique, Global GS1 Barcodes and GTIN Numbers for Your Products." Accessed Dec. 7, 2020. Catapano Group. "How to Get UPC Barcodes." Accessed Dec. 7, 2020.