The Barcode has a Birthday

Posted on | July 1, 2009  

In early June the UPC code turned 35 years old. This milestone was celebrated in Orlando by attendees at the annual U Connect conference who shared an enormous birthday cake adorned with a bar code. Originally develop to help supermarkets speed up their checkout process; the UPC code has grown to become an international standard that is supported by a non-profit called GS1.

The conference is where champions of Electronic Data Integration EDI and the Global Data Synchronization Network GDSN gather each year to hear about best practices and network with peers in their respective industries. GS1 has an affiliate called the ABI EC council which coordinates work in the Alcoholic Beverage Industry. Membership of this group is comprised mainly of the largest suppliers, distributors and trade groups.

Given the 3-tier structure of this industry, the integration challenges mostly involve distributor transactions. Distributors have mostly been brought to the task of EDI by their largest customers; the restaurant and retail chains, and in some cases by suppliers. Integration can occur at several points in the relationship between these parties and involves product level information, pricing and promotions, and the placing of orders. The transaction codes for these exchanges were in use long before the Internet, a reminder that this is not a new challenge.

As you might expect, progress in the liquor industry lags behind other industries like consumer packaged goods or electronics. A beer supplier gave the example of how the same UPC code is applied to the bottle, pack, and case of beer, making it impossible to tell the size of the item scanned. With wine the sheer quantity of unique products on the market is a challenge, and the fact that vintage changes are not supported with unique UPC codes limits their effectiveness.

Beer distributors have been more progressive in adopting both EDI and moving towards the GDSN standards supported by GS1. An example was presented where the world’s largest casual dining restaurant company has been able to integrate with a beer distributor so they receive accurate frontline and promotional pricing, orders are transmitted electronically; and the restaurant receives a pre-delivery notice once the trucks have been loaded for deliveries the night before.

The key to linking the data between the distributor and the retailer is the UPC bar code; however wine and spirits distributors will typically only track the bar code on the case, a different code called the SCC. A distributor is only likely to collect live UPC codes if the salesperson uses a handheld scanner at the store while entering reorders electronically. In practice distributors will clean up their UPC data to a level of accuracy that supports their largest customers, but only on products that chains are ordering and only in markets where chains have a large presence.

To the extent that Beverage Media is involved in the order process through our eOrders software and the orders placed on bevnetwork.com we are exploring whether we can help move this process along by including UPC codes with purchase orders and supporting pre-delivery notices from distributors. Electronic Data Integration is on its way and with it the promise of cost savings, cleaner data and better order accuracy.

Comments