Supermarkets and big brand suppliers are backing a proposal
to bring a product data standard to the UK which could save £1bn in
supply chain costs over five years.
The UK's four largest supermarkets, Asda, Morrisons, Sainsbury's
and Tesco, together with Mars, Nestle, Procter & Gamble, and
Unilever, are among the organisations backing the initiative, which
could allow UK retailers and manufacturers to share product data
more effectively.
A study by the companies published by GS1 UK, the standards body
responsible for product
barcodes and RFID tagging standards concludes that the UK's
retail industry could save £1bn over five years by standardising on
product data information.
Around 80% of product data across the retail supply chain is
inaccurate, which costs retailers more than £140m a year to put
right, it says.
Mike Coupe, trading director at Sainsbury's, says changes in
regulations and consumer buying habits mean that retailers and
manufacturers are having to provide more information about products
than ever before. "We have been talking for decades about a common
data standard, but we are now in a perfect storm," he says.
The Global Data
Synchronisation (GDS) standard will allow manufacturers and
retailers to share product information such as dimensions, weight
and description, as well as environmental, ethical and product
traceability data. GS1 expects retailers will need to record 250
data items in the future to support legislation, supply chain
traceability and provide consumers with detailed product
information.
The UK lags behind retailers in the US and other parts of the
world, which are already using the GDS standard to improve their
supply chains, says Richard Wilding, professor of supply chain risk
management at Cranfield University. "The UK is behind the game. We
can do much more with clean data in the retail supply chain, which
could benefit retailers and consumers."
Inaccurate product data can cause problems across the supply
chain. "If the size of a product is wrong, the number of units in a
pallet will also be incorrect. If the weight is wrong, it could
impact the load a lorry can take," says Wilding. This leads to
pallets being lost or the incorrect quantity of product being sent
out.
| Mobile product data |
|---|
People are changing the way they buy products in supermarkets.
The mobile phone camera allows shoppers to find extra information
on the products they buy in-store by taking photographs of
specially coded barcodes using their handsets. The image is sent up to a web service, which reads the barcode,
to give a unique product code, which is then used to reference
extra information, that can help the shopper make an informed
buying decision. Mike Coupe from Sainbury's believes that the technology
components are now in place to offer this sort of service. However,
adoption will take many years, he
says. |
Lost products due to inconsistent data cost the industry £95m a
year, according to the GS1 study, and £60m of potential sales
revenue a year is lost due to bad data.
Consumers are demanding more information about the products they
buy, says Coupe. For instance, a shopper buying food may be
allergic to certain ingredients, such as nuts, or may be looking
for sustainably-manufactured products, he says.
Internet shopping has given consumers greater product
information, and this is affecting how people buy in retail stores.
"Consumers are more informed than they were five or 10 years ago
when they make buying decisions on a product," says Coupe.
Consumer goods supplier Unilever has been using the GDS standard
in the US with supermarket Walmart. The company manages its product
data centrally in its SAP system. Retailers can connect to the data
using a service called OneSync, one of several data services
supporting the GS1specification. The service alerts retailers
automatically as and when Unilever's product data changes.
With retailers like Sainsbury's looking at the benefits of clean
product data, Coupe says Unilever will be looking to replicate its
US system in the UK.