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USING ECR IS NOT DIFFICULT AND YIELDS ARE GOOD: STUDY

Applying Efficient Consumer Response principles to the perishables department is not as hard as it looks. And doing so yields benefits that are at least as significant as those achieved in dry goods.These are among the conclusions reached in a new report by the Joint Industry Project on ECR, sponsored by organizations such as the Food Marketing Institute, American Meat Institute, Grocery Manufacturers

Applying Efficient Consumer Response principles to the perishables department is not as hard as it looks. And doing so yields benefits that are at least as significant as those achieved in dry goods.

These are among the conclusions reached in a new report by the Joint Industry Project on ECR, sponsored by organizations such as the Food Marketing Institute, American Meat Institute, Grocery Manufacturers of America, National-American Wholesale Grocers' Association, International Dairy Foods Association and others. Participants in the study included representatives from Roundy's, Nash Finch, Ukrop's, Dominick's Finer Foods and Giant Eagle.

Based on case studies, the report confirms certain theories about ECR in perishables, and explores the unique strategies applicable to the perishables department for category management and efficient replenishment. It also establishes significant differences between different segments within the category and states that retailers need to work out different plans for each. One of the greatest challenges for the perishables department, the report acknowledges, is obtaining accurate, reliable data, which is problematic because of the variable weights and packaging of perishable goods. Further, the report recognizes that while bar-code labels scanned at the front end represent accurate price and identification information, "without common market standards the information is of little use to third-party data services . Even greater problems exist within categories like produce, which rely upon cashiers to correctly identify the type of produce at the time it is weighed."

Vital to any perishables management is the use of UCC/EAN-128 or bar codes, according to the report, which uses case studies to document resulting improvements in labor productivity and receiving efficiency, selection and shipping of perishables.

In addition, the report cites various ways that some retailers have been able to provide fresh products at lower cost, including the outsourcing of fresh prepared goods, an option the report explores in detail, providing a "Five-Step Roadmap for Developing Out-of-Store Preparation."

The Joint Industry Project on ECR formed the ECR Perishables Work Group in 1994 to determine the relevance of ECR strategies for perishable goods.