Scanning smarter: The 2D barcode shift
Scanning smarter: The 2D barcode shift
This article has been adapted for the Australian retail context from content originally published by BDO USA.
It’s a Saturday in 2028. You’re planning to meet a friend for lunch near the shopping centre, and you arrive early, so you head into a furniture shop to browse and kill some time. As you wander the sales floor, a smart modular sofa catches your eye — the latest in a line of advanced sofas that use AI to learn and adapt to factors like your body temperature and position. You are planning to redo your living room and think it would fit perfectly.
You are tempted to make a purchase, but there are too many unanswered questions. How will the sofa look with the paint colour you have chosen? Will it fit in the living room, or are your eyeballed measurements off? Do you really need the hassle of setting up yet another smart device at home?
As you are about to walk away, you notice a small tag with a QR code hanging from one arm. Curious, you scan it with your phone camera. It links to a hub with all the information you could ask for. The setup instructions seem easy; the process is mostly automated. Swiping to the next page, the sofa’s dimensions auto-populate. It's a perfect fit.
This seamlessness is made possible thanks to 2D barcodes, a foundational element of the future of retail. Universal Product Code (UPC) barcodes, which have been standard for decades, will be phased out by 2027, replaced by 2D upgrades like the QR codes that are already commonplace in other industries. These upgrades, which offer more customisability for retailers and greater convenience for customers, will fundamentally change how consumers engage with the products they buy.
From price look up to product intelligence
When UPC barcodes were introduced, they brought new levels of efficiency and standardisation. Checkouts became faster and retailers were able to track inventory levels with greater accuracy and fewer errors. The optical scanners required to read UPC barcodes were also relatively cheap, providing a low barrier to adoption, even for smaller businesses.
Fast forward to today, when retailers possess more data than ever before. They are feeling the limits of UPC barcodes, which cannot carry large amounts of information. Any data beyond the code itself must be referenced at the Point of Sale (POS) system or on a scanning device. To future-proof logistics and operations and keep up with consumer demands, retailers need a better way to store and share information.
This is where 2D barcodes come in. Thanks to their two-dimensional structure, 2D barcodes can hold far more information than their one-dimensional UPC predecessors, including product codes, lot numbers, expiration dates, serial numbers, product descriptions, and more. They can also link out to webpages with even more information. Because they are scannable with standard, image-based cameras (such as those found on any smartphone), 2D barcodes are accessible to both businesses and customers without special equipment. Ready access to critical product information will make it easier for retailers to track inventory during normal operations or to identify and group products in the event of a recall or other emergency.
For consumers, 2D barcodes are poised to transform the shopping experience. In-store shoppers will scan codes to access a large and dynamic selection of product-specific content. Retailers will be able to design these content libraries as deep and broad as they want, including elements such as style and fit guides, recipes and suggested pairings, user guides, and assembly instructions, saving paper and providing a convenient reference point for consumers to return to. With this information accessible through a 2D barcode, retailers can also simplify their labels and packaging, providing clearer visibility for important details and the ability to make updates without a total redesign.
Preparing retail systems for 2D barcodes
As the retail industry navigates this transition, businesses may encounter forward- or backward-compatibility challenges as retailers and manufacturers adjust to 2D barcodes. Dual marking, in which products carry both traditional UPC codes and new 2D barcodes, will likely become the norm for several years.
To reduce friction ahead of the change, retailers can take several proactive measures. Existing POS systems and scan guns may not be compatible with 2D barcodes, making hardware upgrades top-of-mind for many businesses. Retailers should take time now to scope out the cost of any equipment upgrades before they become a standard practice. Businesses that still rely heavily on on-premises data systems may need to assess whether their current technology can support the richer data enabled by 2D barcodes, including links to product information and digital content. Doing so requires a solid data foundation, with information from across the organisation stored in a standardised, readable, and secure manner.
Looking beyond basic product data, retail leaders should engage teams from across their businesses, including IT, quality assurance, sales, marketing, frontline workers, and more, to determine what content to connect to a given product code.
What information will customers expect? What will they find most helpful? What will keep them coming back? Once these questions are decided, retailers should establish an ongoing review cadence to govern how content will be updated and maintained.
Retailers must also coordinate with their suppliers to ensure all parties can access relevant product data and are prepared to make the switch to 2D barcodes in a timely manner. Manufacturers responsible for attaching barcode labels to individual items may need additional time or resources to upgrade their hardware or data inventories to align with retailers’ upgrades. Some products have longer shelf lives than others, creating differing levels of urgency: electronics, which can remain on the shelves for months or years, may need to arrive marked with 2D barcodes earlier than food, which turns over at a higher rate.
Australian perspective: What this means for local retailers
For Australian retailers, the move toward 2D barcodes is less about replacing a familiar label and more about preparing for a new standard of product transparency and data access.
Locally, many retailers are managing complex product ranges, long supplier lead times and increasingly digital customer journeys. 2D barcodes offer a practical way to connect physical products to richer digital information — from sizing and care instructions to provenance, sustainability credentials and recall information — using tools customers already have in their pockets. For omnichannel retailers, this creates an opportunity to deliver more consistent product experiences across store, online and fulfilment environments.
Early adoption by major Australian retailers demonstrates how 2D barcodes can support more granular inventory management, reduce waste and improve food safety outcomes when underpinned by consistent data standards and supplier collaboration.
As Australian consumers continue to expect greater transparency and convenience, retailers that invest early in product data foundations and scanning readiness will be better placed to adapt. The transition to 2D barcodes is not a one-off technology upgrade, but a stepping stone toward more connected, data‑driven retail operations, and a more informed, confident customer experience.
BDO supports the shift to connected retail systems and data
BDO’s retail team can help retailers assess point-of-sale and scanning readiness, strengthen product data foundations, and design the content journeys behind 2D barcodes, enabling a shift that improves both operations and customer experience. We help retailers understand what needs to change across systems, data and partners, and how to move forward without disrupting day-to-day operations.
This article is part of our series Future-proofing Australian retail.
