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manufacturers of products that now have 12-digit codes will
not be affected by the code expansion. A two-liter bottle
of Coca-Cola, for example, will keep the same U.P.C., but a
zero will be added to the beginning of its bar-code number
in retailers' product databases. 

"The effect of the change in the U.P.C. code falls squarely
on retailers," said Mr. Friedman. He estimates that the
upgrade will cost at least $2 million for a chain of 100
stores with 10 checkout lanes a store. 

The expense will vary depending on the age of a retailer's
databases, software and hardware and whether it has to hire
outside consultants to make the change. Scanners and other
hardware bought more than three years ago will not read
longer codes and will have to be replaced. Software more
than five years old will also have to be scrapped. 

"Thank God we'd already planned to buy new equipment for a
lot of stores this year," said Richard S. Gilbert, director
of store systems at Duane Reade, a chain of 200 drugstores
in New York City. The stores have a total of 3,500 scanning
devices, each costing $1,000 to $2,500. As for the
cumbersome database modifications that need to be made, Mr.
Gilbert said: "Our consultants say they are working on it,
but they haven't gotten back to me with a plan. I still
don't know how big a deal it's all going to be." 

He might want to ask John Poss. Mr. Poss is the
merchandising coordinator for Ace Hardware, which has 5,100
stores and sells some 65,000 coded products. Ace overhauled
its computer systems to accept longer bar codes in 1999.
The company, based in Oak Brook, Ill., has retail outlets
in 70 countries and more than a hundred foreign suppliers. 

"It was such a struggle to get manufacturers to relabel
things for North America," Mr. Poss said, "and we wanted
the same system in place globally, so we decided to make
the change." 

The company hired a consultant, Cognizant Technology
Solutions, which is based in Teaneck, N.J., and is a
division of Dun & Bradstreet. Ace's in-house team worked on
the project during the day while a Cognizant office in
India took over at night. 

Even so, the project took almost two years to plan and
carry out. In addition to equipment upgrades, modifications
had to be made in more than 500 software programs in
various company divisions (50 in distribution alone). The
most tedious and time-consuming part of the conversion, Mr.
Poss said, was making adjustments to databases. "Every
database in every division touches bar code information,
and they all needed to be reworked," he said. "It's like
Y2K, where you had to go in and expand fields and find
every reference to the date." 

Though Mr. Poss would not disclose the cost of the project,
he said the gains in efficiency and in suppliers' good will
had been "well worth the expense." His advice to other
retailers is to "get busy because you're facing an extreme
challenge." 

But moving to 13 digits may not be enough. The Universal
Code Council and EAN International, which formed an
alliance in 1996, strongly advise manufacturers and
retailers to go a step further and prepare their systems to
accommodate a 14-digit code. That is the length of a newly
patented bar code that takes up less space. Its reduced
size means that it can be affixed to small items like loose
produce, and the extra digits let a retailer keep track of
additional data like batch and lot numbers. 

That additional information would make product recalls
easier. "Today," Mr. Terwilliger said, "once a product is
taken out of the shipping container in the warehouse, you
really can't track it anymore." 

Shipping container bar codes are already 14 digits. The
different bar-code standards mean that retailers need
different computer systems for shipping and receiving,
inventory and sales. By adopting a 14-digit standard,
retailers should be able to put all the information into a
single database. 

Mr. Poss said Ace had added the capacity to scan and store
14 digits when it made its conversion three years ago. "Now
we can scan anything," he said, "whether it's in the
warehouse or at the register, and it immediately goes in to
a centralized system. No more sending data between
divisions." 

The cost and work of making the transition to 14 digits, he
said, was the same as it would have been for a change to 13
digits. 

Representatives from the standards groups said adopting a
14-digit structure - a step for which no date has been set
- could help streamline the sharing of data among all parts
of a retail operation. It would also make it possible, they
said, to identify products anywhere in the world at any
time during the trade process. 

"And to think it all started with pack of gum," Mr. Poss
said. 

http://www.nytimes.com/2002/08/12/technology/12CODE.html?ex=1030208144&ei=1&en=1b5705e7bd2048e6



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