By Randy Goldbeck, Fullscope Director of Services
What is UCCNet?
UCCnet, part of GS1 US, formerly the Uniform Code Council, Inc.UCC), was established in response to growing requests from retailers, manufacturers and suppliers to address the problem of inaccurate supply chain data, such as product descriptions, item numbers or price. Inaccurate or outdated data used in invoice pricing or purchase orders can result in product delivery errors and lost sales — problems estimated to cost the industry over $50 billion annually. UCCnet is a non-profit, neutral organization in charge of maintaining the GLOBALregistry.
The registry acts as a worldwide index that stores the basic information about all products distributed to retailers worldwide. Because UCCnet is a neutral party, major retailers have endorsed it and have created a mini-Y2K event as they request suppliers to comply. To publish to the GLOBALregistry, suppliers gather their product information and assign a unique 14-digit global trading item number (GTIN) to each product.
Because products can ship in many ways, a unique GTIN (Global Trade Identification Number) is required for all product packaging levels (e.g., 4-inch geranium, 6-inch geranium, 606 ﬂat of geraniums, etc.). Once a product becomes part of the UCCnet GLOBALregistry, the supplier selects retailer(s) for publication. To publish, the supplier uses a global location number (GLN) that identiﬁes each retailer. The supplier may publish to every store in the retailer’s organization or get as granular as publishing GTIN information to a single store. If this seems like a lot of work, it is. It requires forethought be given to product naming plus all existing product information must be scrubbed. Yet, in many cases, suppliers who have completed the UCCnet exercise have discovered that their newly created GTIN information is a better product description than what was originally stored in their enterprise resource and planning (ERP) systems.
What are the benefits?
A recent A.T. Kearney study for Grocery Manufacturers of America – Food Marketing Institute revealed the following:
- Correcting catalog errors costs $60-80 per error.
- Thirty percent of item data in retail catalogs is incorrect.
- Each SKU requires 25 minutes of manual cleansing per year.
- Every invoice error costs $400 to reconcile.
- Sixty percent of all invoices have errors; 43 percent result in deductions.
- The average product roll-in takes six weeks.
- Percent of sales lost to inaccurate data is 3.5 percent. The net result is an estimated $50 billion loss through supply chain inefﬁciencies each year.
- In a presentation to the UCCnet Advisory Council, one major retailer revealed that 37 percent of product information from their largest supplier was being re-keyed. After the study, and because of corrective measures, the retailer discovered that it was getting more accurate dimension information and an increase in new product market share over other retailers. Many suppliers are keeping this study in mind and are asking their retailers to comply by setting recommended compliance deadlines.
Cleaning up your product data clearly makes sense. For more information, visit http://www.gs1us.org/
What do you think about UCCNET, GTIN and other practices mentioned in this blog? If you have questions or feedback, shoot me an email at [email protected]