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Just as sunrise marks the start of the day, the 2005 Sunrise signals the beginning of a new era in bar-code processing for food retailers.Way back in 1997, the Uniform Code Council, Lawrenceville, N.J., established Jan. 1, 2005, as the 2005 Sunrise deadline, when North American retailers would be expected to be fully capable of scanning and, more importantly, processing and storing 13-digit and eight-digit

Just as sunrise marks the start of the day, the 2005 Sunrise signals the beginning of a new era in bar-code processing for food retailers.

Way back in 1997, the Uniform Code Council, Lawrenceville, N.J., established Jan. 1, 2005, as the 2005 Sunrise deadline, when North American retailers would be expected to be fully capable of scanning and, more importantly, processing and storing 13-digit and eight-digit European Article Number (EAN) bar codes on products imported from outside the U.S. and Canada. They would continue the 30-year tradition of handling 12-digit Universal Product Code (UPC) bar codes issued by the UCC. Databases, and in some cases scanners, would need to be updated to identify any of these bar-code structures.

Having finally arrived two days ago, 2005 Sunrise is raising two questions: Are retailers ready? And, what's next?

As for readiness, based on a survey of the top 100 retailers across various channels, including food, "we have a good feeling that close to 100% are ready for 2005 Sunrise, and will be able to accept and process 13-digit EAN codes along with UPC codes," said Alan Garton, UCC's director, channel management, general merchandise, retail.

However, for small to midsize retailers, "we do get the sense that there will be a transition [to 2005 Sunrise compliance] through 2005," Garton noted. In some cases, retailers upgraded their point-of-sale systems without looking at other applications such as warehouse management. Others who had relatively basic POS systems saw less urgency in complying. Others, with other IT issues on their plate, simply procrastinated.

In any event, Garton said, UCC will continue to support retailers still working out compliance issues. "There's 30 years of implementation here. So it's hard to change overnight."

The good news is that, unlike Y2K, 2005 Sunrise was not the sort of deadline whose adherence was critical to survival. "It's not all or nothing," Garton noted. "We expected it to be a transition." Still, a lack of compliance could mean a retailer will have delays at the checkout and cause additional product marking costs for itself or its overseas trading partners, putting it at a competitive disadvantage.

"It is in this context of competitive advantages and business continuity that we have communicated the significance of [2005 Sunrise] compliance to our retailers," said Carl D. Marks, senior vice president, strategic planning, projects & information services, Associated Grocers, Baton Rouge, La.

As for what's next, 2005 Sunrise is viewed as just the beginning. Indeed, UCC always encouraged retailers who were stepping their systems up to 13-digit bar codes to add an additional digit and make themselves 14-digit compliant. That would mean they would be able to handle the whole family of bar codes now called Global Trade Item Numbers (GTINs), which include 8-, 12-, 13- and 14-digit codes.

While Giant Eagle, Pittsburgh, is ready for 2005 Sunrise, the chain won't be finished upgrading to 14-digit bar codes until the end of this month, said Russell Ross, chief information officer. "We only have to upgrade the [direct-store-delivery] system in 60 stores to be GTIN 14-digits compliant," he said.

The 14-digit codes are already used in shipping applications on packaging and containers, and GTIN compliance is required for smaller reduced space symbology (RSS) codes on products like meat and produce. GTINs are also a requirement in the Global Data Synchronization Network unveiled last year.

RSS codes containing up to 70 digits of information are being developed for coupons. Retailers who have become 2005 Sunrise and GTIN compliant are positioned to make the transition to scanning those bar codes, which are expected to be used by 2008 (see story, this page).

Streaming EANs

The immediate issue in 2005 for retailers will be the growing stream of EAN-13 bar-coded products expected in the United States. Retailers unprepared for these products may not be impacted severely for six months, Garton noted, but as EAN codes become "more obvious in the supply chain" retailers will understand they "have to work with this," he said.

A few changes in UCC policy will add to the number of longer bar codes. For example, UCC has stated that beginning this year it will no longer issue UCC manufacturer prefixes for bar codes to new companies outside North America. Garton said exceptions to that policy are still possible, "but not for very long."

In addition, UCC will begin to issue manufacturer prefixes to U.S. and Canadian companies that can only be used to create EAN-13 bar codes. That change, however, will happen "eventually, not right away," said Garton, who said it depended on the number of new members and new products UCC has to accommodate.

Asked if he expected to start seeing 13-digit EAN codes in 2005, Marks replied, "That is the proverbial $64,000 question." In discussions with suppliers, it was unclear to what extent they will introduce 13-digit bar codes, he said. "We are unaware of any key suppliers planning to replace traditional UPC codes with 13-digit bar codes for existing items."

Nonetheless, Associated Grocers and its retail members stand prepared to accept the bar codes, which Marks regards as "a potential competitive advantage."

At another Associated Grocers cooperative, this one in Seattle, "we are already seeing 13-digit bar codes at retail," said Gene Puhrmann, chief information officer.

Wine is a product on which supermarkets may soon begin to see 13-digit EAN bar codes, noted John Wilson, product manager, bi-optic scanners, NCR, Atlanta. "European wine vendors will send new products [with EAN codes] to save time and money," he said.

Like many food distributors, Associated Grocers of Baton Rouge went through a comprehensive program to prepare for 2005 Sunrise, including 14-digit GTINs. "We have assessed, evaluated and completed remediation of all known systems and processes affected by GTIN," said Marks. "From our packaged software solutions to our legacy systems to equipment and applications deployed in the retail field, we have replaced or otherwise modified these technology-based enablers to comply with the Sunrise 2005 requirements."

Marks said the biggest challenge he faced at headquarters was combining GTIN remediation with other internal requirements in order to "kill several birds with one stone." As a result, it took more time and resources to complete the effort, particularly for a few mission-critical legacy systems on the mainframe.

At the retail stores supplied by Associated Grocers, Baton Rouge, the biggest challenge was coordinating and communicating with third-party providers of point-of-sale solutions. "It was difficult to assess the readiness of third-party solutions in some instances," Marks said. "We worked diligently to assess those situations, and provide our retailers guidance with factual assessments."

The POS solutions and back-office systems provided by Associated Grocers, which were largely 2005 Sunrise compliant, were remediated by the co-op.

Marks acknowledged that electronic data interchange (EDI) processes with manufacturers may require further work to be in complete compliance with GTIN standards. "Until we attempt EDI with GTIN components, we will not know with certainty if any additional changes are required," he said.

Associated Grocers Seattle also considers itself in compliance with 2005 Sunrise and 14-digit GTINs, both at the corporate level and for retail applications it manages for its members, said Puhrmann. Retail members were responsible for remediation of their own applications, though AG provided documentation on several occasions to help advise them "of the appropriate course of action," he said.

The biggest areas of remediation for Puhrmann included modifications to file interfaces and database tables. Like AG of Baton Rouge, AG of Seattle is not quite done with EDI, still waiting for vendor partners to complete and certify EDI upgrades.

Another cooperative wholesaler, Associated Wholesalers Inc., Robesonia, Pa., for the most part left the remediation work to third-party providers. For example, Retalix, Dallas, handled remediation of the Biceps purchasing system and Triceps warehouse management system used by AWI, noted Glenn Kriczky, director of retail systems, AWI. AWI's provider of retail applications, Retailer Owned Research Co. (RORC), Arlington, Texas, ensured that new bar codes, including 14-digit codes, would be processed by retailers' front-end systems. AWI sponsors RORC with three other wholesale cooperatives. AWI did some "minor adjustments" to some host systems, which already offered larger bar-code fields, said Kriczky.