UPC ADDS UP 25 YEARS OF SAVINGS

ALISON MAXWELL

WASHINGTON -- The Universal Product Code, first scanned 25 years ago at a supermarket in Ohio, creates more than $30 billion in net benefits annually, according to statistics released by PricewaterhouseCoopers at the Smithsonian Institution's celebration of the code's silver anniversary here.

John Nelson, lead partner of PWC's Midwest Consumer Industrial Products division, called the UPC the "great enabler" as the National Museum of American History unveiled its new exhibit "Behind the Lines: The Universal Product Code at 25."

"Remember what shopping was like without uniformity?" Nelson asked the audience, which was comprised mostly of retailers, members of the Dayton, Ohio-based Uniform Code Council and other businesspeople. "Retailers remember. They remember armies of price clerks stamping every single candy bar and then restamping when they were marked down. They remember trying to read ball-point pen price points on T-bone steaks and losing $3 on each sale because they read 45 cents instead of $3.45. The UPC has made jobs easier and lives simpler. It has changed retailing as we knew it."

When the UPC Ad Hoc Committee was established in 1970, members estimated that the code would save the food industry $1.43 billion, Nelson said. PWC research, however, indicates that net benefits today are 5.65% of sales within the grocery channel, with $293 billion in scanned volume or $17 billion annually.

UPC scanning benefits are not limited to the grocery industry, Nelson noted. Other channels like discount, drug, club, convenience and supercenters account for another $248 billion in scanned volume. Assuming their productivity gains are no more than grocery, the UPC creates another $14 billion in net benefits for other industries.

Bob Martin, past president and chief executive officer of Wal-Mart Stores' International division, called the "little black bars" real friends of the consumer and the retailer. The code has over its 25 years allowed stores to carry a better assortment and to achieve better sales with the same inventories, he said. In addition, the UPC has reduced lead times and increased customer service.

"The UPC has raised business standards," Martin said. "And that's a pretty tall order for little black bars."

The economic impact of the UPC has not reached its fruition, Nelson said.

"We can justly celebrate how far we've traveled, but we've only just begun," he said. "The UPC will play a bigger and bigger role in e-commerce. The code will continue to reign as the great enabler and will enable a truly global economy."

"There's more that's going to happen then speeding up the checkout," Martin predicted.

The UPC exhibit runs through March 2000 and features the original pack of Wrigley's gum that had the first UPC bar code printed on the label. Also included in the exhibit is the history of the bar code and information on how the scanning technology works.