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Published in U.S. 1 Newspaper on July 19, 2000. All rights

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For E-Commerce, a Data Standard

If you think it’s hard to order tomato juice

electronically

from an online grocer — because the grocer offers too many item

choices — imagine the complexity of organizing all online

transactions

so that the same item gets the same electronic identifier, starting

with the manufacturer and following through to the wholesaler, the

retailer, and the consumer.

A Universal Product Code (UPC), a certain type of bar code, can

identify

items in a standard way in the bricks and mortar environment, but

everyone has been waiting for industry-established standards for the

electronic environment.

On Tuesday, July 25, at a press conference in Princeton University’s

McCosh Hall, Paul Benchener, president and COO of Lenox Drive-based

UCCnet, will launch an electronic trading community, a business to

business supply chain for both manufacturers and retailers

(www.uccnet.org).

UCCnet is an Internet-based universal trading community in the retail

and consumer goods industries, and it is the sister company to the

Uniform Code Council, a nonprofit that supports and distributes UPC

standards.

Last April UCCnet completed a "proof of concept," says Tom

Duffy, senior director of marketing. Three grocery companies and three

food suppliers (Kroger, Supervalu, Wegman’s, Ralston Purina, Procter

& Gamble, and PepsiCo/Frito-Lay) worked together on this. Now groups

of executives are helping to develop a Global Standards Task Force

to link the electronic trading communities.

The parent company, Uniform Code Council Inc. (www.uc-council.org),

has 55 employees in 25,000 square feet on the second floor at 109

Lenox Drive, and UCCnet (its wholly-owned subsidiary, www.uccnet.org)

has 14 people in 11,000 feet in its new quarters in Suite 115 of that

building. Nationally, UCCnet works with Uniform Code Council.

Internationally,

it works with the European Article Numbering Community (EAN).

UCCnet supports the movement, access, and organization of data, not

how it is used, says Duffy. "Early on we positioned ourselves

as an Electronic Commerce Platform. We will provide `pointers’ to

the location of data within the supply chain for supply chain members

and thus link the data within the industry."

"UCCnet is the only industry-developed and supported foundation

for the Internet-based electronic commerce. It is the first open,

standards-based, technology neutral, real-time electronic trading

community offered across the Internet," says Duffy.

Other B to B exchanges exist, Duffy admits, over 650 of them, "but

we are completely different. We are creating the ability for all those

exchanges to exchange information. We will synchronize data, based

on industry-defined application requirements. We are in a unique

position

because of our not-for-profit, non-proprietary position."

"We are creating the life cycle information at the item

level,"

says Duffy. "The bar codes have been established for 26 years,

and now we are ensuring compliancy to those business rules."

"It will provide a ton of efficiencies, such as logging errors

within data transactions and preventing problems with the way data

is exchanged," says Duffy. "It will provide greater access

to global markets and facilitate the sharing of information more

quickly

and more easily."

If the track record of UCC, UCCnet’s parent company,

is any indication, UCCnet will be wildly successful. Standards set

by UCC make barcode scanning possible and thus save the food industry

$17 billion a year, according to a PricewaterhouseCoopers report last

year. UCC creates more than $30 billion in net benefits annually —

a benefit 25 times greater than what was predicted 25 years ago. To

put it another way, UPC’s economic impact is bigger than the market

capitalization of Amazon.com and bigger than 1998 sales for

McDonald’s.

"We see initiatives such as UCCnet’s an essential part of the

continued broad penetration of E-commerce in the marketplace, and

we look forward to working with initiatives such as theirs," says

Sri Kasi, senior vice president for strategic planning and general

counsel for IndustryNetworks. His firm, also based on Lenox Drive,

provides large and midsize companies with a turnkey web-based solution

to manage all aspects of supply chain processes through its E-supply

chain management chain (www.industrynetworks.com) (U.S. 1, July 5).

The need for standards is going to become clearer as the number of

B to B exchanges proliferates, and UCCnet is not the only entry into

the standards market. "There is a fair amount of confusion in

the market today," says a spokesperson for an industry group,

AMR Research, "and UCC’s track record makes it a good candidate

to lead the charge."

"I don’t believe there will be one open standard, that one

organization

can get mobilized for all the industries," says Gerald Bose, of

Locus Consulting on Alexander Road. There are 200 electronic commerce

marketplaces now, Bose estimates, with 10,000 predicted by 2004.

"It’s

like the situation with Microsoft. On one hand, standardization

represents

a monopoly, but on the other hand it would make doing business over

the Web it infinitely easier."

UCCnet has a growing community of nearly 200 grocery companies, and

the supply chain revenues at these companies top $1 trillion. UCCnet

is now moving into a second industry — general retail. In July

it will roll out its core services so that manufacturers and the

retailers

in the Consumer Package Goods (CPG) industry can access product life

cycle information and data.

"With UCCnet, subscribing members of the supply chain will be

able to make use of the Internet to post and access — in near-real

time — information that is accurate, secure, and compliant to

industry standards. This information could include price changes,

item introduction, authorizations, discontinuations, packaging, and

UPC changes, to name a few," says Duffy.

Databases that are not webcentric and that are not using

the UCCnet system share a fatal flaw — updates may not always

get transferred. Common practice is for trading partners to keep

copies

of a shared product data base on their own systems. "When changes

are made to one partner’s copy of the file it can be transmitted,

but nothing ensures that the changes actually get made in the other

partner’s files. Often the results are mismatching of data, resulting

in invoice deductions, etc.," says Duffy.

UCCnet will help correct this problem by implementing any change

across

all trading partner databases automatically — the changes

will absolutely get made. In addition the partners see the changes

so they are aware of them.

Experts are calling UCCnet an "exchange for exchanges" linking

trading partners, solution providers, and independent trading

exchanges.

To fulfill this promise he thinks UCCnet must meet these requirements:

Stay independent in order to be fair to all parties.

Be technically up to snuff in order to be able to support

the industry standards.

Develop value-added services that the industry needs or

obtain them through strategic alliances.

Be designed for the long term to survive competition and

fluctuations in the market.

"We expect that the true market power being searched for

in the B to B market place will come from an open, noncompetitive,

global trading community," says Duffy. "We can provide the

common set of standards to the exchanges."

— Barbara Fox

UCCnet, 1009 Lenox Drive, Suite 202, Lawrenceville

08648. Paul Benchener, president/COO. 609-620-4600; fax,

609-620-4601.

Home page: www.uccnet.org.


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