TIMING IS EVERYTHING

DEENA AMATO-McCOY

With 2000 only a couple of New Year's Eve parties away, the supermarket industry is scrambling to prepare its computer applications for the new millennium. The fear is that those who are unprepared will see their information systems shut down on the morning of Jan. 1, 2000.

For the most part, retailers and wholesalers that spoke with SN already have a game plan in motion. One retailer even predicts it will be compliant by year's end.

"We are in the process of finalizing our schedule of which details are priority tasks and need to be addressed first to get in compliance with the year 2000," said Ron Waldbillig, assistant vice president of management information systems for Hy-Vee Food Stores, West Des Moines, Iowa.

Kennedy's Piggly Wiggly, Coeburn, Va., is also researching what its top priorities are within its 12 stores.

"We have identified 99% of our applications that are not 2000-compliant, and lucky for us it is only a handful -- six to be exact," said Robert Wright, manager of management information systems for Kennedy's Piggly Wiggly.

He added, "We are researching the possibility of upgrading or replacing these programs, and, thankfully, we are fortunate that this is not a big process for us."

B&B Cash Grocery, Tampa, Fla., is completing its assessment stage and predicts that completing its compliance project could be accomplished as quickly as six months from now.

"The project could be completed in six months, but our goal is to be 2000 compliant by this summer," said Gordon Goodyear, director of management information systems for B&B Cash Grocery. "It is not necessary for us to be done this summer. We could wait until February or March of next year, but why wait until the last minute?"

Retailers just beginning their move toward year-2000 compliance need to establish clear priorities among their information systems, and understand the interrelation of various systems.

"The easiest thing to do is make a list of all applications used within your business, and look at each on an individual basis," said Kennedy's Piggly Wiggly's Wright. "If you keep a hot-sheet on file, then you have documentation in case something was overlooked."

Bob Drury, vice president of management information systems, Schnuck Markets, St. Louis, believes that all retailers should have a plan, and need to initiate it immediately.

"Retailers need to understand the problem at hand, and if they do not have a plan of action by now, it may be too late," he said. "If you plan to bring in programmers to help convert your systems, there is going to be a shortage of help as the turn of century approaches."

The most proactive retailers have also taken steps to assess manufacturers' efforts to become 2000 compliant.

"We have contacted most of our business partners, asking them to correspond with us to reassure us that they will be compliant," said James Crouch, director of information technology for Topco Associates, Skokie, Ill. "Many of our suppliers have already responded that they will positively be compliant, so that puts us at ease."

Vendors working with Kennedy's Piggly Wiggly took the first step to inform the retailer of their status.

"Our vendors are bringing their compliance efforts to my attention and what their plan is to fix specific problems," said Wright. "Since most of the suppliers are aware of the issue, I am confident that between our [combined] attention to the matter, we will keep smooth business operations."

Others in the supermarket industry express uneasiness because of the sheer number of different companies providing and selling products.

"I'm a bit concerned because [although] it is easy to fix our compliance problems, it is not easy having to worry that several hundred vendors may have problems that need to be fixed as well," said Marty Simmons, director of retail systems for Certified Grocers of California, Los Angeles.

He added, "Let's say one of our vendors has not upgraded their software to accept the year 2001 as a delivery date on their purchase orders. We still need to be able to process those orders and accept that merchandise."

Another area of concern with vendor transactions is the use of electronic data interchange.

"I have talked to very few vendors about the problem, but we are waiting for a new version of EDI standards, which will be 2000-compliant, to be approved," said Schnuck's Drury. According to Drury, testing is going on now to ensure that EDI transactions will be able to handle the year 2000 date issues.

"EDI really needs to be ready for the new millennium," he said, explaining that a computer's inability to recognize a date as valid, even on simple documents such as purchase orders, can affect EDI transactions.

URM Stores, Spokane, Wash., a cooperative wholesaler that has only been using EDI for the past 18 months, is also uncertain how EDI vendor transactions will fare in the year 2000. "The weakest link in this picture is that a new transaction set is needed to deal with the new century," said Joe Jurich, vice president of information services for URM Stores.

The effort toward 2000 compliance brings to the forefront other technologies that could affect the way the supermarket industry conducts business. For example, many in the industry predict Internet usage for home shopping and electronic communication will become even more important as the millennium approaches.

"I see on-line shopping becoming very important in the new century, especially because it is an easier way to attract potential Generation-X customers," said Bryan Hull, director of retail information systems for Family Fare Super Markets, Hudsonville, Mich.

Topco agrees that electronic commerce could be a big benefit to the food industry. "On-line shopping could be a big application because it is a low-cost method to transfer customer buying information to retailers quickly," Crouch said. "Since cost is a primary concern, any application that can drive operating expenses down is worth researching."

One Internet application that may turn retailers' heads is its ability to improve communication -- both internally and with consumers.

"We are using e-mail internally as a way of eliminating paper," said B&B Cash Grocery's Goodyear.

Hy-Vee is also in the process of preparing for e-mail benefits.

"Many people in our industry are looking to implement it because of its ease of use and the access it provides to real-time information." said Waldbillig.

According to John Sarno, vice president of information systems for Big Y Foods, Springfield, Mass., e-mail allows retailers a better connection with their customers.

"It is a flexible way for retailers to communicate with their customers without the need to enter the store," he said. "It could be used for feedback, target marketing, even to communicate weekly specials."