This article was updated in March 2023 to reflect current industry trends and new information.
Serial numbers or SNs have become ubiquitous in modern life: they’re on our phones, and in our software. They’re engraved on our cars and printed on the packages that are couriered to our doorsteps (and more importantly, on packages that never make it to doorsteps).
They’re also a very useful part of modern inventory management. Let’s look at how serial number tracking works, who uses it, and how.
What is a serial number?
Serial numbers are unique identifying codes. They can be strictly numerical, or contain letters and symbols as well – the key is that they’re a one-off code matched to a single product or component.
Typically, serial numbers are created sequentially, and have segments recording different types of information, such as where a product was created, the date of manufacture, and any other data deemed useful within the product’s lifecycle, from assembly and distribution, right through to repair and replacement.
Serial numbers vs lot numbers or batch numbers
Lot numbers – or batch numbers as they’re also known – differ from serial numbers in that they represent groups of items.
Lot numbers are often used in the food and beverage industry to track batches of perishable products that will expire at the same time. They’re also heavily used in the pharmaceutical industry, where they are often a legal requirement, and a critical part in tracking product recalls.
A quick read through the United States Food and Drug Administration (FDA) food and drug recall page shows the importance of batch tracking, from identifying food with undeclared allergens to contaminated batches of medicine.
Serial numbers, on the other hand, are assigned to individual items rather than groups. They’re most typically used to track high value items, including consumer electronics.
Real-life application of serial number tracking
There are many reasons manufacturers use serial numbers – let’s cover off the main applications below.
Serial numbers for product recall
Having serial numbers assigned to both products and components can reduce the impact of a product recall dramatically.
Imagine you’re a manufacturer with factories all over the world. Everything is going swimmingly until you get three products returned with a faulty widget that causes them to catch fire.
You investigate and discover this particular widget is supplied by a half dozen different companies – only one of which has shipped you faulty stock.
Without serial number tracking you would likely need to recall every one of your products at an extraordinary cost.
But with a proper serial number tracking system? Despite all of your products being effectively identical, you use the serial numbers on the returned items to find they came from the same factory.
Moreover, the numbers show that all were made in the same production run: you isolate the production runs that used the faulty widget and issue a product recall that affects hundreds, rather than thousands of products.
Serial numbers for compliance
Sometimes using serial numbers is not a matter of risk mitigation, but rather legal compliance.
All cars, for instance, are stamped with a Vehicle Identification Number, which contains lot number information – showing where and when the vehicle was made – as well as a unique segment to the code that identifies the particular car.
Perhaps most famously, every firearm sold must be stamped with a serial number – though how well these can be tracked is another issue altogether.
Serial numbers for after-sales service
After-sales service, warranties and repairs can be dramatically improved if serial number tracking is in place. Especially with complex products with multiple components, such as cars or consumer electronics.
This is because some products are sold under the same brand name and model, even though ‘under the hood’ the internal components are being constantly refined and improved.
So, for example, a 2020 model of a particular car marque may be built with different window seals, airbags and stereo ports to the 2019 version, but is still marketed as the same vehicle. Conversely the same parts may be used within multiple makes and models before being phased out.
With products like these serial number tracking allows you to match the right replacement part to the right product when things go wrong, or simply in the course of routine maintenance.
Think of the last time you replaced the toner cartridge on a home printer, for instance, and you’ll appreciate how important serial number tracking is in creating a matrix of matching replacements parts and products.
Serial numbers for theft protection
Another excellent post-sales use for serial number tracking is the protection it can provide your customers in the case of theft. A high value item that is stolen and then recovered by police can be definitively linked back to its original owner and returned (and the theft proven) if the serial number is provided when the theft is reported.
A digital version of a serial number – a Media Access Code – can also be used to identify items, alerting customer support when a stolen device is turned on and connected to the internet.
Serial numbers for inventory control
Unseen by consumers, serial number tracking can simplify stock management dramatically – especially for products with multiple high-value components.
With inventory tracked down to the individual component level, time spent rummaging through boxes for specific parts, or on the phone to other warehouses, becomes a thing of the past – while quality management becomes easier.
One of Unleashed’s customers, UK firm Aston Microphones, uses serial number tracking with great success to keep a close eye on the hundreds of tiny-but-expensive components that go into their top of the line recording equipment.
- Read more about how Aston Microphones uses serial number tracking in their manufacturing process
7 benefits of serial number tracking
There are some stand-out benefits and general wisdom to explore, so let’s take a look at the core bonuses of serial number tracking.
1. High visibility and tighter groupings
Having every item of inventory visible and correctly grouped pays huge dividends. Serial number tracking makes groupings easier to achieve, and more beneficial for forecasting and overall management.
Everything from the linking of similar items down to the behaviour of certain inventory groups can be achieved.
2. Knowing the character of your inventory
You could say that serial numbering helps you know the character of your inventory. Like a name tag, with the most important information underneath.
The more you know about your inventory, the better you can plan and make adjustments to get the most out of it.
3. Complete and accurate history
Serial numbers allow easy access to the complete history of each individual part or product. This is a great advantage for any business using historical data for forecasting, or needing to enact product recalls.
Leading inventory management software providers make this a simple and user-friendly task.
4. Reduced data entry and errors
Serial number tracking is one the best ways you can cut down on data entry and errors. With each product or item numbered, every transfer, sale or order is more accurate and better monitored.
Using mobile and barcode technologies optimises the use of serial numbers, and is particularly useful for manufacturing businesses, or for those with a large variety of inventory.
5. Efficient and streamlined warehouse management
There’s usually a lot happening in the warehouse of a business. Even relatively small ones have their problems, so businesses are always looking for new systems to help with the efficiency and effectiveness of operations.
Serial number tracking is one key way that you can reduce the errors and increase productivity. The use of serial numbers and mobile technology is by far the best solution to a lot of the issues of running a warehouse.
Serial number tracking also allows for the deeper use of lean inventory practises, helping businesses free up capital that’s unnecessarily tied up in stock on hand.
6. Goods in process
For manufacturing businesses, serial number tracking is an essential tool. It provides accurate tracking, transporting and ordering from start to finish of the manufacturing process.
It enables the use of techniques like Just-In-Time, which rely on the ability to move or order items required for production at exactly the right time.
7. After-sales processes
Another great advantage is with after-sales processes and actions. If a part is found to be faulty or there is a product return, the necessary data is easily available, accurate and complete.
Serial number tracking can save businesses thousands – even millions – of dollars during product recalls.
The dos and don’ts of serial number tracking
There are a few important things to consider when using serial numbers on your products and components.
- You must be able to create durable and readable labels for each item
- If using serial number tracking within your warehouses you must have the ability to easily read and record them, for instance with barcode scanners
- Your stock management system must support the tracking of serial numbers
Serial number tracking is a tried and true feature within Unleashed, and can be switched on from within Company Settings. It allows customers to:
- List a serial number against a specific sale which is then shown in a customer’s record for warranty purposes
- Recall products by serial number if necessary
- Track specific serial numbers by location, such as from warehouse to warehouse<
- Track serial numbers via shipments, post-sales
For more on this feature in Unleashed Software, visit the Serial Number Tracking page here.
