C&K TO PILOT B2B STANDARD FOR DSD

MICHAEL GARRY

BROOKINGS, Ore. -- C&K Markets here plans next month to become the first independent supermarket retailer to pilot a B2B electronic communication standard developed in the convenience store industry.

The initial application of the standard will be on receiving and synchronizing promotional pricing and other data from direct-store-delivery suppliers.

The standard, called NAXML, was developed through the nonprofit Petroleum Convenience Alliance for Technology Standards (PCATS), Alexandria, Va., a convenience store industry B2B standards group founded in 2003.

PCATS is an outgrowth of standards work conducted by the National Association of Convenience Stores (NACS), which invested $5 million over seven years on NAXML development.

C&K's wholesaler, Unified Western Grocers, Commerce, Calif., has became the first grocery wholesaler to join PCATS, said Mike Brown, general manager of retail technology for Unified. Associated Wholesalers Inc., Robesonia, Pa., also plans to join PCATS, said Glenn Kriczky, director of retail systems for AWI, which supplies convenience stores as well as independent supermarket operators.

C&K, which operates 50 stores under three banners, plans to test the standard as a data structure for receiving pricing, promotion and item information from local distributors for DSD suppliers, including Coca-Cola and Anheuser-Busch. The NAXML standard is based on Extensible Markup Language (XML), an open standard allowing Web pages to function like database records. The standard is also being used in the convenience-store industry for transmitting invoices, among other applications.

C&K will initially test the standard at its headquarters and at five or six stores, "probably starting next month," said Hank Shields, director of IT, C&K Markets. "We have a lot of small suppliers that want to transmit data electronically, but aren't technologically equipped to handle EDI," said Shields. "So we're trying to find a standard that will work. We don't care what the standard is as long as all the suppliers are using the same one, and we can pass it to the next guy that comes along."

"XML technology delivers the capability for any independent retailers to have access to, and make effective use of, the same data the large retailers have capitalized on for years," said Brown. "The jury is still out, but my gut tells me this will work."

According to Brown, the NAXML standard uses "the same data set we use in a grocery store, with some tweaking because it's XML."

Unified will be accessing documentation for the PCATS NAXML standard and "passing it along" to C&K, said Brown. C&K will incorporate the specs into its Computer Associates Ingres database, said Shields. Both C&K and Unified have agreed to work with PCATS to publish findings from the pilot program upon completion in the first quarter.

If the pilot pans out, C&K would expand use of the standard to "all data exchanges," including all of its stores, and its wholesaler and independent suppliers, said Shields. Brown said it could be used to transmit invoices and even advance ship notices (ASNs) to stores.

PCATS is making the basic NAXML standard documents available for free to anyone at www.pcats.org. The documented version of NAXML, which gives the full meaning of each element, is available for free to PCAT members.

The C&K pilot comes at a time when major manufacturers and food retailers are focusing on ways to improve synchronization of item data through a new Global Data Synchronization Network (GDSN). These efforts have been applied to warehouse-delivered items and have largely not yet included DSD or promotional item information.

DSD pricing and promotion information currently comes to C&K on paper or Excel spreadsheets, varying by vendor. By contrast, the NAXML-based communications would ideally be uniform across vendors, saving labor and improving accuracy, said Shields. Once accepted at C&K headquarters, the pricing information would be almost instantly transmitted to the appropriate stores, improving DSD receiving and invoice creation, he noted.

Shields said he expects the bulk of the cost in the pilot will be in development time. He doesn't think it will be difficult to apply a standard created for convenience stores to a supermarket environment. "It doesn't matter whether it's applied to 3,000 items or 30,000 items," he said.

By linking suppliers directly to retailers, the NAXML standard also eliminates third-party firms that serve as a transfer point for B2B communications, cutting the cost of the process, observed Brown. "You just go to an FTP site and download the information," he said. Retailers may have to pay for an XML interpreter, he added, but those are also available for free on the Internet.

Following the C&K pilot, Unified eventually plans to form a portal through which it would "add value" to NAXML transmissions, such as suggesting strategic pricing options for retail members, Brown explained.

PCATS decided to seek out a retail food operator to try the standard since "the same Coke truck delivering to a c-store rolls a few more yards down the street and hits the local supermarket," said Ted Mason, director of technology standards implementation for PCATS.

Over the past year, "scores" of c-store retailers have tested or rolled out NAXML, including 7-Eleven, Flash Foods and Valero Energy Corp., said Mason.

Anheuser-Busch said it has found NAXML "extremely easy to work with," though it did need to invest in some incremental resource training for XML. Thus far, the company has used the NAXML standard to send electronic invoices and price updates as well as for item synchronization.

The results for Anheuser-Busch have been "an increase in efficiency, removing much of the manual key-in work, and the vast amounts of paper documents that we deal with every day."