FOOD LION JOINS 'WAVE OF THE FUTURE' WITH UCCNET

SARAH MULHOLLAND

SALISBURY, N.C. -- Food Lion here has become the newest member of the growing UCCnet community.

Food Lion officials told SN it made the move to join UCCnet in an effort to simplify its electronic transactions with suppliers.

The retailer anticipates a significant impact on efficiencies throughout the trading community.

"We [at Food Lion] feel that data synchronization and developing a common language electronically to track products and to log product information is really the wave of the future," said Jeff Lowrance, a spokesman for the 1,200-store chain.

"More than anything, it's really going to increase efficiencies within our trading community, streamlining processes and reducing costs," he added.

"That's what Food Lion is all about, trying to be efficient so we can continue to offer low prices," Lowrance said.

UCCnet -- a nonprofit subsidiary of the Lawrence, N.J.-based Uniform Code Council -- is becoming a formidable source for up-to-date pricing information and product descriptions, industry observers said.

The Internet-based trading community currently counts several major grocery operations in its numbers, such as Ahold USA, Chantilly, Va., and Supervalu, Minneapolis.

Wal-Mart, Bentonville, Ark., made their membership official this past summer.

On the supply side, such noteworthy names as Kraft, Northfield, Ill. and Procter & Gamble, Cincinnati are also members. Food Lion will begin implementing the system in January 2002, Lowrance said.

It will be 'strongly encouraging' its vendors to participate as well, he added.

Food Lion officials expect "many or most" to eventually come on board.

It will be a gradual implementation, he said. There are some commodities for which the technology is not currently in place, and these suppliers will be waiting to see how quickly the technology will be made available.

"It's going to benefit both Food Lion and our suppliers," he said.

"It will allow suppliers to put more products before retailers, increasing visibility there, while also giving retailers a chance to look at a broader range of products."

Lowrance declined to comment on the financial details.

After a slow start, UCC Net is picking up momentum as more and more retailers understand its function.

According to a spokeswoman for the organization, UCCNet's function is quite simple. This is not a body that sets standards, but a service that makes use of universal, industry standards, she explained.

UCCnet makes sure all trading partners are speaking the same language for electronic item identification.

In a sense, it makes the real-time exchange of such information possible.

Industry sources estimate that 30% of the item information in retail is incorrect. This leads to incorrect and untimely orders, order refusals and a host of other problems throughout the supply chain, including out-of-stocks and angry customers.

The source at UCCnet said that a retailer stands to realize, on average, a 50% reduction in losses due to invoice discrepancies and errant product deliveries by coming on board.

This also saves on administrative costs as less time is spent on fixing incorrect purchase orders, she added.

New product orders are particularly prone to error and miscommunication as it typically takes 10 to 15 paper steps and up to six weeks to bring a product to shelf, the source explained. UCCnet enables retailers and suppliers to communicate on a purely electronic basis, cutting lead time to as little as two days.