The version number fires off the call that theres a update

When user click update it downoads all the new files and then looks in the update folder for update info 

Cache seams to be cleared for new files 

Update folder for new llanguage and pages etc 

Look in any plugin for the update folder and look at how its done photos plugin is goid example

Tammy +1

When I update the build number in the plugin xml file, is that also the folder number that I have to put in the update folder?

I've noticed some plugins have a much higher build number in the xml file than there is in the updates folder.

Not really, the number may not match, the number of the update folder is arbitrary and does not relate to the build number is plugin.xml

usually update folder contains functionality on updating database or langs

but if you do the changes in the source code of the plugin and you have not done any or don't need to apply new langs or other manipulations with the database, in this case you up only your plugin build -> so that means even though the plugin is updated, the changes were done in the source code itself. 

if there's any changes in the DB or langs, then the update folder is included with the higher number than previous update folder. I hope I made it clear for you. 

Hi ross, I understand. Thank you for your help.

No problem