Reducing Costs by Enhancing Visibility in the Supply Chain Henri Barthel General Manager Business Development EAN International Geneva, 21 October 2003

EAN International Set up in 1977 as not for profit international association with Head Office in Brussels 12 founding members from European countries Today network of Member Organisations in 100 countries More than 1,000,000 companies worldwide participate in the EAN•UCC system

Our Vision Supply and Demand Chains Improvement Solutions Require Global Open Multisectoral EAN.UCC Standards

EAN.UCC Data Carriers (Barcodes) 5 4 1 2 3 6 7 8 9 > EAN-13 UPC-A (0 1) 5 4 1 2 3 6 7 8 9 ITF-14 UCC/EAN-128

RFID/EPCTM From Barcodes/EAN... To RFID/EPCTM Appears certain that GTIN will be embedded in the EPC. Current discussion focuses on issue of whether the GTIN will have a fixed (versus floating) spot within the EPC. Point out that the antenna is distinct from the chip itself Comment here that EPC will not immediately replace the barcode; they will co-exist for some time Unlike barcode scanning, EPCTM renders line of sight scanning unnecessary, provides serial identification, and is “always on” Source: EDS (RFID graphics) & Auto-ID Center (EPC graphics)

EANCOM, a subset of UN/EDIFACT USER'S IMPLEMENTATION 80 % 20 % Interchange Agreements

A B C EANCOM IN TRADE, TRANSPORT AND FINANCE SUPPLIER BUYER INTERBANK COMM. BANK ‘S’ BANK ‘B’ 12. CREMUL 10. DEBMUL B 1. PARTIN 9. PAYMUL 2.PRICAT 5. IFTMIN 3. ORDERS SUPPLIER 4. ORDRSP 6. DESADV C IFTSTA 7. RECADV 8. INVOIC BUYER 11. REMADV FLOW OF GOODS

EAN / EDI users 1995 - 2001 Both overall EDI use and EANCOM use has been on the increase in the past decade.

eBMethodology Conceptual Model Business Process Modelling Capture User Requirements User Implementation Guidelines Business Process Models (UML) Discovery/ Analysis Core Components Feeds eBusiness Domains Methodology UML to XML Transformation Rules XML Desing Rules XML Desing Methodology Implementation Models (IUML) Context XMLBIE + Choreography Class Diagrams GDD Repository XML & UML Registry XSD XML Messaging Transport Routing & Packaging -Layer architeture -Security Package Specification

EAN.UCC Standard Bar Code Links the Physical Flow to Information Flow EAN.UCC simplifies Supply Chains Physical Flow Mfg Item Case Pallets Trucks Distributor Trucks Pallets Case Item Destination User Information Flow EAN.UCC Standard Bar Code Links the Physical Flow to Information Flow

Supply flow management is centred on the delivery of products through the supply chain to the end-customer. Inventory planning was traditionally confined to the downstream end of the supply chain. Nowadays, retailers have started to push inventory-planning responsibilities back to manufacturers of finished products. Increasingly, packaging companies are expected to perform logistics functions for their customers (the manufacturers). Some packaging suppliers are doing this before customers ask, while others are being forced along by their customers’ requirements. Understanding the principles of inventory planning and the EAN•UCC standards used in it is valuable for all partners in the supply chain, packaging companies and their own suppliers included.

The bar code provides the most accurate method of entering data into a warehouse-management system (WMS). Radio-frequency scanners allow data entry to occur in real-time. The WMS responds to relayed data by information triggering the next task. EAN•UCC bar codes and EANCOM® messages drive the WMS. They allow for real-time online receiving, put-away and replenishment, picking and shipping. They also replace manual processes, inclusive of confirmation and validation of all product movement. The WMS directs the put-away of product from the staging area to the appropriate storage area. The forklift operator scans the EAN•UCC Logistics Label, which identifies logistics units, mainly pallets, and the WMS tells the operator where to store them. EANUCC standards also enable radio-frequency order picking. The operator goes to a storage location, scans the location and EAN•UCC Logistics Label identifying the logistics unit, picks and delivers it to the loading location and scans it to close the transaction. With much of the information required for receiving and despatching goods originating from different suppliers and customers, the use of common identification and communication standards – EAN•UCC standards – is an absolute necessity for efficient supply chain management.

Most companies forecast future demand based on historical customer order patterns. However, actual consumer demand is often very different from the stream of orders. Each member of the supply chain observes the demand patterns of its customers and in turn produces a set of demands for its suppliers. The further a company is upstream in the supply chain, or in other words further from the consumer, the more distorted is the order stream relative to consumer demand. Forecasts are inevitably more accurate when they are based on actual consumer demand, such as point of sale data. The supply chain begins with the end-customer. Consumer goods and produce are identified by means of Global Trade Item Numbers (GTIN), such as EAN/UCC-13 and EAN/UCC-8. These numbers are represented in EAN-13 and EAN-8 bar codes, which allow for their automated capture (scanning) at the point of sale. Linking point of sale data with the ordering process provides an enormous leap forward in improving customer responsiveness and efficient replenishment. EAN•UCC standards enable this link.

Electronic catalogues Facilitate master data alignment of product & party information through interconnected electronic catalogues. A Global Registry will connect the existing and future electronic catalogues operated at national level

Data Synchronization Process GDS Registry Supplier Supplier Datapool Datapool Retailer Retailer Supplier Supplier Datapool Datapool Content Provider Retailer Retailer Global Registry Messages Datapool Messages (Not processed by Global Registry) Content Provider

Traceability - ISO Definition “The ability to re-trace the history, use or location of an entity by means of recorded identification”.

Information management Traceability: the compromise Risk management Profitability Identify Communicate Traceability Manage links Record data Information management

UN Economic Commission for Europe

Thank you barthel@ean-int.org www.ean-int.org