© EAN Australia Limited

www.ean.com.au

LINKT H E S U P P L Y C H A I N

> IMPETUS 2004 SPEAKER LINE-UP

> VICTORIAN RFID CLUSTERGROUP WINS INDUSTRYSUPPORT

> CAPILANO SWEET WITHACCREDITATION AUDIT

> KNOWLEDGE CENTRE CELEBRATES 1ST BIRTHDAY

> CASE STUDIES • METCASH INTEGRATED

SUPPLY CHAIN • MODEL ENGINES REVS UP

WITH EAN•UCC • GENERAL MILLS AUSTRALIA LTD & GXS

ISSUE NO. 4 • OCTOBER 2004 Now circulated to over 15,000 people!

EAN Members

rush to secure their seat at

impetus 2004

02 Chairman’s message

03 CEO insights

04 You’re invited toimpetus 2004!

05 impetus 2004Trade Show

EAN 2004Leadership Awards for Standards inAction

06 Victorian RFIDcluster group winsindustry support

07 RFID privacy and the law

Big retailer, smallretailer: learn howto trade above your weight

Odyssey SCMSystem - First tosupport EPC Global/ RFID Standards

08 Liquor industrylooks to go live in 2005

EAN andSwinburne worktogether oneducation

09 Capilano sweet withaccreditation audit

Your first electronicmessages

10 Health eCommercepilot – showcasesextensiveopportunities forhospitals andpharmaceuticalcompanies

Thecommercialisation of RFID in Australia

11 Knowledge Centrekicks on for 1stbirthday

Website upgradeimproves accessibilityfor members

12 CASE STUDYModel Engines revsup with EAN•UCC

EAN Australiapeople: Spotlight onMarcel Sieira

13 Education & Training

CASE STUDYProduct CatalogueManagement(PCM) made easy

14 ISO Report FormatSeminars - back bypopular demand!

CASE STUDYMetcash IntegratedSupply Chain

15 The most commoncause of failedscans: light margins

EAN Event Diary

CONTENTS

LINK OCTOBER 2004

Tell us what you thinkWe are interested in your feedback.The newsletter’s primary role is to keep EAN Australia members informed and updated on the latest developments in supply chainmanagement and ecommerce. If you have any ideas, comments, points-of-view or criticisms, please forward to eanaust@ean.com.au

CHAIRMAN’S MESSAGE

It’s almost impossible toimagine an Australiansupermarket without barcodes - they’re pivotal togetting the right productonto the shelves on time.In fact, the standardsupporting the bar codehas provided Australianbusinesses with supplychain efficiencies tocompete locally andglobally.

Even so, we take barcodes for granted becausethey’re everywhere andtouch our lives everysingle day.And that’s ameasure of EANAustralia’s success becauseit’s only 25 years ago thatthe very first product gotits stripes.

Looking back, it’s almostlike watching thedevelopment of a child.EAN Australia wasunheard of in 1979 and, ina field where it takes thecommitment of wholeindustries to make adifference, we had tobegin with baby steps,simply spreading theword.

EAN Australia has sinceblossomed into maturityand is now a fully-fledgedand credible standardsbody.Today, EAN bringstogether thousands ofAustralian businesses from18 industries, easing theway of millions oftransactions through thesupply chain to make dailylife that much simpler.

Ironically though, in someways, not much haschanged: the need tocommunicate supply chainmanagementstandardisation and itsbenefits are still central toeverything we do.

With the launch ofEPCglobal Australia, ourmembers look to us foradvice, hands-on help andmost of all, an Australia-wide plan.With EAN’s 25years of strengtheningindustry partnerships anda powerful base of supplychain expertise, we knowit’s going to be easier thistime around.

We can count on thecommitment of ourmembers and all levels ofgovernment to throwtheir support behind us. InVictoria, for example, theRFID Action Australia waslaunched by the Ministerfor Information andCommunication, MarshaThompson, who will alsoopen our inauguralimpetus 2004 conferencein October.

EAN Australia is equippedwith a wealth of talentand experience, wellconnected and ready toface the future. Our 25thanniversary year is just asexciting as our first: awhole new technology isdawning and it is ourmission to turn it to youradvantage.

Russell Stucki:Chairman,

EAN Australia

WHAT’S CHANGED IN 25 YEARS

CEO INSIGHTS

03

Conferences are a greatway to keep up-to-datewith the fast-moving fieldof supply chainmanagement and emergingtechnologies while buildingnetworks with other like-minded people inside andoutside of your ownindustry.

In the past, EAN Australiahas sponsored orendorsed conferencesorganised by others thatincluded some supply chainmanagement content butas supply chainmanagement becomes oneof the hottest newbusiness disciplines, wethink the time has comefor a conference to bededicated to globalstandards that are enablersof world’s best practices.

As the local body of EANInternational, we are in aunique position to hostsuch an event andaccordingly invite you tojoin us at EAN Australia’sinaugural conference:impetus 2004.

At impetus 2004, 18experts will cut throughthe hype and concentrateon what, why and hownew technology can makea difference to yourbottom line. Our speakersrepresent Wal-Mart, ECRAustralasia, EPCglobal,Auto-ID, Coles Myer,Verisign, SAP, Oracle, LionNathan and the AustralianFood and GroceryCouncil (AFGC).

You’ll learn about theintricacies of new supplychain technology, hear thestory of giant US retailerWal-Mart implementingRFID technology, get ColesMyer’s perspective onwhat’s vital to successfultrading partnerships and bebriefed on the latest EPCdevelopments. Gainvaluable insight frommanagers responsible forthe implementation of newtechnology in supply chainprocesses at Gillette,VisyIndustries, Meat &Livestock Australia andPatties.

Aside from the specialistknowledge you will gainfrom the conference, youwill be privy to EPCglobal’svision to support the useof Radio FrequencyIdentification (RFID) intoday’s fast-moving,information-rich tradingnetworks. It’s going to beone of the highlights of our25th anniversary and wehope you and yourcolleagues will join us inthe celebrations.

Maria Palazzolo:CEO, EAN

Australia

IMPETUS 2004: SUPPLY CHAINBUSINESS INTELLIGENCE

AUSTRALIAN INFORMATION INDUSTRY ASSOCIATION

04 LINK OCTOBER 2004

YOU’RE INVITED TO IMPETUS 2004!Welcome

EAN Australia looks forward to welcoming you to the inauguralImpetus conference on Tuesday 12th and Wednesday 13thOctober 2004 at Sofitel Melbourne.

Supported by the Victorian Government and five industryassociations, impetus 2004 is unmissable for savvy professionalsinvolved in supply chain logistics, inventory control, purchasingand distribution. Be one of the first to hear about the latest anddeveloping technology needed to equip your company foreffective supply chain management. Reserve your place now byvisiting www.impetus2004.com.au

impetus 2004 speakers boast unique experience at the cuttingedge of supply chain management. Here’s a taste of who you’llmeet at impetus 2004:

Tuesday 13 October

The Honourable Marsha Thomson,Minister for Information andCommunications Technology

Official conference opening.

Andrew Potter, Group General Manager – Supply Chain, Coles Myer Limited

Learn about Coles Myer’s (CML) radicalfive-year transformation program toimprove the flow of products from supplier to shelf.

Derek Jones, Director,New Technologies Lion Nathan

Explore the critical business case for data integrity and datasynchronisation and share Lion Nathan’s experience.

Chris Richardson,Director,Access Economics

One of Australia’s best-known economists,Chris examines the economic context for2004/05 and considers the retail outlookstowards 2006 and beyond.

Tony Taylor, Director – RFID forInternational,Wal-Mart Stores Inc

Hear how Wal-Mart broke down barriersto RFID and gain an insight into Wal-Mart’saims and strategic approach.

Dick Cantwell, Vice President,Global Supply Chain,The Gillette Company

Follow Gillette’s steps to successful EPCimplementation and discover the benefits for supply chain processes.

Wednesday 14 October

Henri Barthel,Technical Director, EPCglobal

Consider the EPCglobal network and itscomponents: the EPC numbering scheme,RFID technology, software interfaces and the network’s global architecture.

Professor Peter H Cole, Professor of RFIDSystems and Director of the Auto-ID ResearchLaboratory,The University of Adelaide

Everything you ever wanted to know aboutthe Auto-ID Center and its transformationinto the Auto-ID Laboratories and a previewof current research.

Peter Hood, General Manager,Information Technology and BusinessDevelopment,Visy Industries

Find out what Visy Industries learnt fromProject Visychip and the first application ofRFID/EPC in the southern hemisphere.

Harris Boulton,Deputy Chief Executive,AFGC

Preview the latest ECR reports discussing therelationship between synchronised masterdata today and the introduction of EPCtechnology tomorrow.

Christine Raward, General Manager,Client & Innovation Services,Meat & Livestock Australia

See how the Australian red meat industry isencouraging greater systems integration incurrent applications while implementingeCommerce and the EAN•UCC system.

Joe Rettino, General Manager,Purchasing and Logistics, Patties Foods

Hear how Patties Foods implementedEAN•UCC to meet customer requirementsand improve inventory managementpractices with suppliers.

Proudly supported by:

05

EAN 2004 LEADERSHIP AWARDS FOR STANDARDS IN ACTION

In celebration of its 25thanniversary, EAN Australia hasestablished two awards to bepresented at the impetus 2004Conference in October.

The EAN Leadership Awards forStandards in Action will recognise onecompany and an individual for their workwith the EAN•UCC system.

The individual award recognises thecontributions made by an individual inchampioning the promotion andimplementation of the EAN•UCC globalbest practice standards. It also recognisesthe leadership role of the individual inbeing an advocate of the EAN•UCC.

The company award recognises acompany that has driven theimplementation of the EAN•UCCstandards within its organisation andraised knowledge on the standardsamong its staff and partners.

Judging panellist, Steven Pereira EANAustralia Chief Information Officer, saidthe awards encapsulate the essence ofEAN Australia.

“Supply chain success requires boldleaders with a spirit of co-operation andthe EAN Leadership Awards forStandards in Action go some way tothanking them for that,” he said.

TRADE SHOW

Visit the impetus tradeshow, where leadingsuppliers will present thelatest industry informationand innovations. Look for:Platinum Sponsors> SAP> OracleGold Sponsors> Global eXchange Services> Matthews

Exhibitors

> AAPT

> APICS

> IBM

> iCrystal

> Intermec / Gamma Solutions

> Datanet

> Denso / Unique Micro Design

> Global eXchange Services

> ITP / Innovit

> Leadtec

> Matthews

> Odyssey

> Oracle

> RFID Action Australia

> SAP

> SSA Global

> Supply Chain Consulting

> Telstra eBusiness Services

> Verisign

Group discounts

Book for three or more and enjoy a 10% discount!

See you at the EAN impetusconference in 2004

Visit www.impetus2004.com.aunow to reserve your place atimpetus 2004.For more information, contactKate Rosengren on 03 9550 3478.

Training helps your organisation to grow

06 LINK OCTOBER 2004

VICTORIAN RFID CLUSTER GROUPWINS INDUSTRY SUPPORT

Victorian businesses haveflocked to newly formed RFIDcluster group, RFID ActionAustralia.Just weeks after the Victorian governmentannounced a $100,000 grant to establishthe group, RFID Action Australia hassecured in-kind contributions fromindustry worth an estimated $600,000.

Three reference groups have been formed,each backed by around 20 companies.RFID Action Australia spokesperson, IanWatt, said a wide range of stakeholdergroups are represented, including users,solutions providers, researchers, industryassociations and educators.

Among the associations is AutomaticData Capture Australia (ADCA). Chair,Geoffrey Ramadan, said the cluster groupwould benefit all stakeholders.

“RFID Action Australia lets us collectivelydevelop RFID know-how, identify

resources and foster industrydevelopment by learning from others’experiences, rather than reinventing thewheel in isolation,” he said.

RFID Action Australia secretariat andhost, EAN Australia COO Mark Fuller,was impressed by the support of theVictorian Government and thecommitment of the companies involved.

“As the implementation of RFID and theelectronic product code (EPC) can be acomplex matter, it is important thatorganisations have a trusted source ofinformation,” he said.

“The mission of the RFID Action Australiacluster is to become that trusted point ofcontact.”

RFID Action Australia has arranged thedevelopment of a website incollaboration with Multimedia Victoria(MMV) that will publish the results ofpilot programmes and publish RFIDrelated standards, news and information.

RFID Action Australia will also hostseminars, and the EAN Australia SupplyChain Knowledge Centre will simulatehow RFID works in an integrated andtransparent supply chain.

Helping users, like Nintendo’s PeterStroud, stay abreast of the rapidly evolvingtechnology is one of RFID ActionAustralia’s key objectives.

“Some of our ideas could take years tobe realised and others might turn out tobe pie in the sky,” Stroud admits,“but thebeauty of the cluster group is that we canwatch and take part in RFID’sdevelopment so we can confidentlyimplement the right technology for apilot.”

To register your interest in RFID ActionAustralia, call the RFID Action Secretariatat EAN Australia on 1300 366 033 formore details.

07

RFID PRIVACY ANDTHE LAW

As US regulators scramble to dealwith the privacy implications ofradio frequency identification(RFID) in the supply chain,Australia’s retailers are proactivelydeveloping their own code.

RFID-specific bills designed to legislatethe protection of consumer privacy havebeen proposed in several US states. Inan encouraging sign for retailers, the firstof these to be voted upon was rejectedby the Californian senate.

In a pre-emptive move, the AustralianRetailers Association (ARA) and EAN

Australia have brought together retail,manufacturing and consumerrepresentatives in a working group todevelop a privacy code of practice.

The code, together with the existingPrivacy Act 1988, is aimed at preservingconsumer confidence during thedeployment of EPC RFID tags atconsumer item level.The ARA expectsto release the privacy code this year.

“The RFID privacy code is about buildingconsumer awareness and promotingchoice,” said the ARA’s Chad Gates.

BIG RETAILER, SMALL RETAILER:LEARN HOW TO TRADE ABOVE YOUR WEIGHTThe cost-saving secrets of some ofAustralia’s most successful retailers arerevealed in a Business Case Frameworkdocument developed by the AustralianRetailers Association and EAN Australia.The principles identified can be utilisedto further opportunities for all retailbusinesses large and small to improvetheir current operations, enabling themto trade as efficiently as any corporationaround the world.

Launched in July, the e-business guideoutlines how retailers like 7-Eleven,

SuperCheap and Betta Stores Limitedhave lifted the profitability of theircompanies using EAN’s open globalstandards and technology, and exploresthe multitude of cost savings that can bereaped by other retailers.

Retailers interested in assessing the valueof technology such as scanning,electronic messaging and other e-business technology, will find thisframework invaluable.The guide, plusonline return on investment tools, canbe found at www.ara.com.au\business

ODYSSEY SCMSYSTEM - FIRST TOSUPPORT EPCGLOBAL / RFIDSTANDARDS

Melbourne based Mid-CompInternational is the first Australiancompany to join EPCglobal Australia, thelocal body administering the standardsfor Electronic Product Codes used inRadio Frequency ID (RFID) tags.

Odyssey RFID Trials are currently takingplace with a number of customers toreduce inventory holdings, control theftprevention and optimise delivery times.As Odyssey is a browser based real-timeSCM system RFID scanning can beperformed and alerts delivered anywherein the world.

"Mid-Comp has shown strong leadershipin the RFID field and we are pleased tosee a Victorian company once againpushing the leading edge of technology"says EAN Australia's General Manager ofStandards, Fiona Wilson.

Mid-Comp is also one of the foundingmembers of the Victorian StateGovernment sponsored RFID ActionAustralia.

Mid-Comp International Pty Ltd.Ph 03 9011-8288www.midcomp.com.au

08 LINK OCTOBER 2004

The major retailers in thegrocery and liquor industry areurging suppliers to becomeEANnet® Ready as soon aspossible to enable the phasingout of manual universal buyingforms (UBF).At a recent EANnet event, Coles/Bi-Lostated their objective that all suppliersmust be ‘actively engaged’ with EANnetby the end of 2004 and that data changes

would only be accepted via EANnet frommid 2005.

Metcash’s Michael Haire reiterated hiscompany’s goal to phase out thenecessity for paper UBF from 31December 2004.At the same event,Franklins confirmed a September deadlinefor initial data alignment with suppliers.

Woolworths has also announced itsintention to source all product datathrough eCRI, which will include theability to read product and pricing datafrom EANnet.This will commence in

November 2004.

Suppliers not yet registered with EANnetshould register online atwww.ean.com.au/eannet and follow thesteps outlined in the EANnet ReadyChecklist. Suppliers are also encouragedto attend the upcoming EANnet IndustryEvent scheduled for late October inMelbourne, Sydney and Brisbane tobetter understand the EANnetrequirements.

Please refer to page 15 for EANnettraining session dates.

LIQUOR INDUSTRY LOOKS TO GO LIVE IN 2005

Formalising a partnership in education andtraining, EAN Australia and SwinburneUniversity of Technology have signed amemorandum of understanding.

Swinburne will include EAN material in itscourses and introduce students to thesupply chain using the EAN Supply ChainKnowledge Centre. Signing the agreement,EAN Australia CEO, Maria Palazzolo, and

Swinburne Vice Chancellor, Professor IanYoung, said closer ties would enhance thework readiness of graduates and therelevance of studies for supply chainpractitioners.

Mrs Palazzolo said EAN Australiamembers would also benefit from theexchange of ideas with university staff, witha delegation from EAN Australia soon to

visit the Swinburne Centre forCollaborative Business Innovation.

“We want to bring the best of academiato our membership courses and curricula,lifting their knowledge to equal the best-in-class supply chain management,” she said.

“We can certainly do this throughcollaboration with universities likeSwinburne.”

EAN AND SWINBURNE WORK TOGETHERON EDUCATION

09

Honey world leader, CapilanoHoney Limited, is the first EANAustralia member to bereaccredited to issue its ownbar code verification reports.

Capilano National Sales Manager, KevinFenton, said accreditation gave Capilanoan edge when pitching new product toretailers.

“When we present exciting newproducts, retailers want and deserve theproduct in the shortest possible leadtimes,” he said.

“Often, there’s only two or three weeksto develop artwork, prototypes and allthe documentation, so any time savingswe can carve out are vitally important.

“Being EAN-accredited saves us at least aweek every time we need a bar codeverified and that’s an invaluable advantagefor Capilano.”

Being one of the first companies to beaccredited also offers Capilano some lesstangible but powerful marketing benefits:the company seeks to be a leader inevery respect.With a turnover of morethan $80 million and a capacity toprocess and pack over 25,000 tonnes ofhoney per year, Capilano Honey is nowone of the largest packers in the world.

“The ability to verify your own bar codesmakes sense and we knew it wouldn’t belong before it became the acceptednorm and required by our customersglobally,” he said.

“Capilano wanted to be ahead of thewave.”

Capilano was well prepared for bothaccreditation and, two years on,reaccreditation according to EANAustralia’s Richard Jones. Reaccreditationinvolves a comprehensive audit of acompany’s processes against a 49-pointchecklist covering seven main areas:

> Policy development and managementresponsibility

> Procedures for maintaining quality

> Staff training

> Process control

> Inspection and testing

> Control of non-conforming products

> Internal quality audit processes

Ahead of the audit, Capilano had alreadyreviewed all seven areas and when EANstaff met with Capilano’s Kyra Fenton andNick Justo for the official audit, they wereimpressed by the company’sprofessionalism. Just hours later, Capilanowas reissued with its two-yearaccreditation certificate.

“The requirements of the accreditationprocess make for good practice andinvolve simple but effective systems thatmost companies would like to adopt as amatter of course,” Richard Jones said.

“An external audit every two years inaddition to their own internal auditsmakes sure everything is up-to-date andstill working as it should. Capilano’sexperience shows how simple butworthwhile EAN accreditation can be.”

To learn how your company couldbenefit from becoming EAN accreditedfor bar code verification, contact JohnLane at EAN Australia.

CAPILANO SWEET WITHACCREDITATION AUDIT

YOUR FIRSTELECTRONICMESSAGES

A new tool from EAN Australia

saves time and frustration for

trading communities testing

electronic messaging.

The Community Management Tool

(CMT) is a web-based system that

automatically tests files for compliance

with communications and accreditation

processes as well as business rules.

Partners can work independently

through the testing process and CMT

provides instant feedback 24 hours

per day.

For large trading communities involving

hundreds of suppliers, the project

assistance and savings promise to be

immense.

Coles Myer Limited is among the

retailers to recognise CMT’s potential,

and has set it up as a common tool for

existing Kmart, Coles and Officeworks

projects. A number of the retailer’s

suppliers have begun testing using the

freshly launched tool.

Feedback from initial users has been

very positive, and provides

endorsement for other Coles Myer

Limited suppliers to also use this

world-class EAN facility.

For further information, please contact

EAN Australia on 1300 366 033.

10 LINK OCTOBER 2004

TELSTRA eBUSINESSHELPINGCOMMERCIALISATIONOF RFID IN AUSTRALIA

Moving beyond the pilot phase torealise RFID’s promised benefitsdemands the right mix ofinfrastructure, expertise andtechnology.

Telstra offers Australian business anunmatched package of attributes essentialfor profitable RFID implementation:> A base communications platform,

which includes Internet Protocols (IPLAN,WAN etc), GPRS, CDMA andfacilitates messaging via direct datatransfer (such as FTP, HTTP), voice,SMS and email.

> An established any-to-any trading andmessaging platform that can acceptand process data collected from RFIDtags and readers, turn this data intobusiness events understood by yourexisting systems, and pass the resultsof these events directly into the back-office systems of trading partners.

> Enabling communities and supplychains to transact electronically inareas such as EDI, payments,procurement and supply chain visibility.

> Wide experience in infrastructuresolution development andimplementation.

> Established relationships with suppliersof RFID hardware and softwaresolutions.

> Membership on standards committeessuch as EAN Australia, as well as afoundation member of EPCglobalAustralia.Assisting in the development,maintenance and promotion ofstandards enables Telstra to deliversolutions incorporating the latesttechnology while featuring open, non-proprietary architectures that permitupgrades to RFID hardware astechnology changes.

> Extensive reach across organisations –large and small – within industrysupply chains.

> Business process outsourcing andmanaged services capabilities, allowingTelstra to put together and run cost-effective solutions around RFID.

As RFID approaches mass adoption,Telstra is building an internal team andrange of partners with experience inautomatic data capture, retail systems,logistics, supply chain, distribution andradio frequency hardware.Withunmatched local infrastructure and

expertise,Telstra is ideallypositioned to supportAustralian businessesready to embark on thisemerging technology.

HEALTH eCOMMERCE PILOT – SHOWCASES EXTENSIVEOPPORTUNITIES FOR HOSPITALS ANDPHARMACEUTICAL COMPANIESFaster and more accuratereceipts achieved during theMonash Medical Centre pilothave spurred on the healthindustry’s commitment todeveloping eCommercecapabilities using EAN•UCCstandards.The first phase involved transactionsbetween the Monash Medical Centre’spharmacy department (MMC) and threesuppliers: Clifford HallamPharmaceuticals, Hospital Supplies ofAustralia (HAS) and Orion Laboratories.Key stakeholders included HealthPurchasing Victoria (HPV), NationalSupply Chain Reform Task Force(NSCRTF), Pharmos Software andproject manager, EAN Australia.

“The project has been a great successand a very positive experience for all

involved,” said Ian Larmour, director ofpharmacy, Southern Health.

“The successful completion of theproject has been possible because of theco-operation between all parties and aspirit of goodwill. Much has been learnedand this has given Southern Health aclear path forward.”

The Monash Report Executive Summaryfor the first phase can be downloaded atwww.business.vic.gov.au/ecepp

The next phase of the pilot is to roll out the eCommerce system to all fiveSouthern Health hospital sites withengagement being sought by othersuppliers. In addition this phase will seekto consider the future development andapplication of emerging technologiessuch as Radio Frequency Identification(RFID) and Reduced Space Symbology (RSS).

11

KNOWLEDGE CENTRE KICKSON FOR 1ST BIRTHDAY

In just its first year, the EAN

Supply Chain Knowledge

Centre (SCKC) has hosted

2240 visitors, fully trained 60

members and is in the process

of training another 225.

Celebrating its first birthday inNovember, the SCKC lets visitorsexperience the supply chain forthemselves, simulating best practice in aninteractive and realistic demonstration.

A short tour provides an overview ofthe possibilities, while the pathway tosupply chain excellence is explored inmore detail during a six-moduleprogramme called ‘The Chain Reaction’.Among the first 60 people to completeThe Chain Reaction were staff fromColes Myer, GXS, Simplot, FoodWorksand Colgate Palmolive. Colgate’s BobBourcher wrote to EAN afterwards.

“Firstly, I’d like to thank EAN for lastweek’s Supply Chain Training experiencefor the Colgate representatives,” hewrote.

“The feedback on the format, facilities,facilitation (well done Mark) and the useof technology was full of praise.

“I was personally impressed with thefocus on the ‘end to end’ supply chain.It’s all too easy to compartmentalise thisstuff and miss the key lesson.”

Customised versions of ‘The ChainReaction’ programme have also beendeveloped for George Weston Foodsand various groups of the McCormickFoods team.

Aside from hosting tours and ‘The ChainReaction’,The Supply Chain KnowledgeCentre offers meeting rooms, which arewell utilised by Alliance Partners andtrading partners. Mark Judge, the SCKC’sco-ordinator said the centre providedneutral and well-equipped venues forcommercial initiatives.

“The SCKC is designed to provide aphysical meeting place to make it easierfor co-operation to flourish, whetherbetween trading partners or involvingentire industries,” Mark said.

“EAN Australia’s broad objectives forthe centre involve RFID, eMessaging anddata synchronisation, but we are lookingfor input from members on the detail.We plan to build user groups andadvisory groups by industry or functionto direct the SCKC’s future.

“The centre is becoming busier andbusier and in the next 12 months, weexpect that will only increase, with EANbecoming more closely aligned with thedelivery of supply chain and logisticstraining.”

To find out more, visitwww.ean.com.au/kc or call PatriciaSlattery or Mark Judge on 1300 366 033.

WEBSITEUPGRADEIMPROVESACCESSIBILITY FOR MEMBERSEAN Australia launched its newlydesigned website www.ean.com.au onSeptember 1, offering members adynamic, interactive and more accessibletool, 24 hours a day, seven days a week.

The new look and functionality are theresult of feedback from our members,industry groups and other site users.

“The website navigation has beenrevamped, so visitors and members willbe able to gain access to member serviceofferings with ease and speed” said NealeAusten, EAN Australia General Manager - Information Systems.

“At the same time, we have designed thesite to reflect our expanded businessoperations, while creating a site that isattractive, informative, effective as amarketing tool, and at the same time,accessible and intuitive.”

12 LINK OCTOBER 2004

MODEL ENGINES REVS UP WITH EAN•UCC

EAN AUSTRALIA PEOPLE:SPOTLIGHT ON MARCEL SIEIRA Tell us a little about yourself, Marcel

I was born in Caracas,Venezuela, andcame to Australia 13 years ago. Happilymarried, I have one beautiful daughterand have placed an order for another(who we expect in December which willbe a wonderful Christmas gift!).

How do you help EAN members?

As Manager of Business Development,my main task is to identify how we canbest meet our members’ diverse andcontinually changing business needsthrough the implementation ofnumbering, bar coding and electronicmessaging.

What is your professionalbackground?

Before joining EAN Australia, I was withLeadtec Systems Australia for seven years.

During my time at Leadtec, I worked ona large number of Electronic Commerceprojects in the Grocery, GeneralMerchandise, Hardware,Automotive andAutomotive Aftermarket Industries.These projects included electronicmessaging, data transformation andintegration, scan packing, warehouseapplications and data synchronisationsolutions, based on the EAN•UCCsystem.

What makes you ideal for your role?

It just so happens my EAN role involveshelping companies to develop, plan,implement and deploy solutions based onthe EAN•UCC system, which alignsperfectly with my industry backgroundand expertise.

What satisfaction do you get fromyour work?

Discussing members’ business needs,which are so diverse that it’s always alearning experience. It’s also great to seecompanies go from deciding toimplement the standards, to planning,implementation and ultimately enjoyingthe benefits.

What do you like best about your job?

The high esteem in which members holdEAN Australia. I strongly believe in theEAN•UCC system and its hugeopportunity for our members to gainoperational efficiencies and monumentalbottom-line savings. It is also great to bepart of a team contributing to thedevelopment of world standards.

Model Engines, a family business that hasgrown into a multimillion-dollar successstory was bursting at the seams when itcalled EAN Australia for a fresh look at itsoperations.

Planes, boats, automobiles and evenhelicopters, together with their radiocontrols and thousands of spare parts,crowd Model Engines’ warehouse.Theproduct range includes more than 9000items, mainly sourced from Asia, Europeand America, with some specialist partsmade locally.

Wholesaling to a network of about 600retail hobby and toyshops across Australiaand New Zealand, Model Engines hasgrown at the rate of around 15% perannum to become a market leader.

Knowledgeable staff members areinvaluable to the business, according toManaging Director, Mike Farnan. Mikeemploys enthusiastic hobbyists assalespeople because only an ‘insider’ hasthe technical expertise demanded by themarket.The same specialist knowledge isneeded to pick orders, given ModelEngines’ confusing array of thousands ofseemingly identical parts.The result:salespeople are working both the phonesand the warehouse.

“Our salespeople are finding it hard to

sell because they just don’t have enoughtime,” Mike said.

“They should be asking whether thecustomer needs some extra glue to gowith their order, but instead, they’rerushing around finding and despatchingparts.”

The problem of stock identification isexacerbated by Model Engines’ crampedconditions. Despite purchasing aneighbouring warehouse and rentingmore space offsite, space is at such apremium that the location of new stock isdictated by the availability of free racking.

“I knew the key to freeing up oursalespeople was a more systematicapproach that allows less experiencedstaff to find the right items in the rightlocation,” Mike said.

In response, Model Engines invited EANAustralia to conduct a thorough supplychain review.After spending a few dayson site gaining an appreciation of thebusiness’s operations, EAN expertsanalysed and mapped Model Engines’current processes using the Supply ChainOperations Reference Model as atemplate.The team then overlaid theEAN•UCC standards for the correctapplication of standard item numberingand bar code labelling of products.

EAN’s extensive report included 28recommendations for quick wins, processimprovements and strategic initiatives.Apart from the benefit of EAN Australia’stechnical expertise, Mike said the reviewreport proved a valuable communicationtool.

“The review dispelled any illusions ourmanagement team might have had aboutbar codes,” he said.

“Just sticking a bar code on a box is notenough – we must have the systems rightfirst to get results.”

As Mike anticipated, the reviewrecommended the allocation of stocklocations so that salespeople could befreed from picking duties but alsouncovered a need for better checking ofstock during receipt. Phase two of thereview will see the recommendationsprioritised for implementation and Mikebelieves the timing is perfect.

“Before we go ahead and put the bulk ofEAN’s recommendations in place, we aregoing to move to a much larger location,”he said.

“The report will help us to plan the newfacility properly so we can start 2005fresh with effective processes.”

> CASE STUDY

13

PRODUCTCATALOGUEMANAGEMENT(PCM) MADE EASY

EDUCATION & TRAININGEDI, XML,CPFR demystifiedA new training series willdemystify some of the supplychain’s most daunting acronyms:EDI, XML, CPFR, plus datacapture and collaboration.

Called the ‘EAN Knowledge Series 101’,the training will explore the benefits andoperation of the standards andtechnologies during half-day sessions atEAN Australia’s Melbourne head office.

The initiative comes in response togrowing demand from EAN Australiamembers and industry, according toEAN’s Paul Hackett.

“Many of our members hear theseacronyms being used by customers orsuppliers and aren’t sure what exactly theymean for their businesses,” Hackett said.

“CPFR, for example, stands forCollaboration, Planning, Forecasting andReplenishment.

“It’s the current maxim for best processpractitioners across the globe, but is notwell understood.We explain how it worksand show what an impact it’s had on realbusinesses.

“ Whether it’s CPFR, EDI or XML, the 101series weighs the alternatives anduncovers how to generate a return oninvestment across your entire business byincreasing sales while reducing inventoryand non-value adding processes.”

‘EAN Knowledge Series 101’ sessions willrun in November at EAN AustraliaMelbourne. For session information referto page 15 or contact Paul Hackett onphackett@ean.com.au

Designed to make preparation andmaintenance of catalogue data assmooth and simple as possible, PCMamalgamates data extracted from adiverse range of existing systems,while allowing direct data entry.

General Mills Australia Pty Limited, homeof some of the world’s best-known brandsincluding Betty Crocker, Häagen-Dazs,Pillsbury, Green Giant, Old El Paso, andCheerios, was one of the first companiesto support and participate in the EANnetData Synchronisation platform. Itsobjective: to provide trading partners withthe most current and accurate informationabout the General Mills product range.

General Mills’ EANnet planning included atransition from their existing mainframepackage to a new predetermined SAPERP system, Product CatalogueManagement (PCM) from GlobaleXchange Services.

PCM offered four key benefits:

> Flexible enough to meet the transitionbetween internal systems.

> A sustainable process for ongoingmanagement and product information.

> Adaptable to suit ongoing businessrequirements without the need ofexternal consultants.

> Maintains relevant industry cataloguestandards and validation rules, enablingverification of data prior to populatingEANnet.

About Global eXchange Services

Global eXchange Services, Inc (GXS)operates one of the largest B2B eCommerce networks in the world,managing 1 billion transactions annually formore than 100,000 trading partners.Withmore than 35 years experience, GXSprovides supply chain services andsoftware to 60% of Fortune 500companies. GXS is headquartered inGaithersburg, MD in the U.S., with salesand development offices throughoutEurope and Asia Pacific. Global eXchangeServices (Australia) Pty Ltd is a whollyowned subsidiary of GXS Inc. For moreinformation, visit www.gxs.com

> CASE STUDY

14 LINK FEBRUARY 2003

ISO REPORT FORMAT SEMINARS -BACK BY POPULAR DEMAND!

Grocery wholesaler, Metcash, has investedin warehouse technology and supplychain initiatives to keep its 10,000independent retailer customerscompetitive.

Ken Bean, Metcash’s Chief ExecutiveGroup Logistics and CorporateDevelopment, says voice picking, put tolight and channel management are amongthe cornerstones of his strategy.

Voice picking

Metcash pioneered voice-picking inAustralia to address mis-picks and hasrolled the technology out to every majorIGA and Australia Liquor Marketerswarehouse. The results were impressive:mis-picks in the liquor warehouseplummeted from 60-70 errors per weekto just a handful.

"Voice fixes mis-picks because you've gotto go to the slot location and call thecheck digit. It's pretty near impossible tobe in the wrong location and pick thewrong item," Ken said.

Put to light

Metcash’s put-to-light system managessmall orders for the 'convenience'channel. Put-to-light overcomes inventoryinaccuracy and damage issues associatedwith picking full cases and singles(breaking boxes) from the same location.A typical order for a small store could bejust 20 cases spread across the

warehouse – making conventional pickinginefficient.

"Small order profile means I should takethe product to the picker, not the pickerto the product, and cut the walkingdistance out,” Ken said.

“To do that, I've got to batch pick in acentral location and then send the goodsto the put to light system, where they dothe 'putting'.”

One division’s distribution productivityrate has soared from 65-70 cases perhour to 4 -500 puts per hour: a 30%labour saving. Service levels improvedfrom 89% to 98% and customer queriesdropped from 20 a day to 1.Eliminating duplication of stock helpedreduce inventory from $1.7 million toabout $300,000. Ken expects payback inone year to 18 months.

Supply chain

Metcash is implementing the samefundamentals announced by the majorchains, such as roll cages, suppliercollaboration and factory gate pricing(FGP).

Metcash has a centralised slow-movingwarehouse and cross-docks 'slows' andgeneral merchandise into its other statedistribution centres alongside fast movingproduct.The company has also stolen amarch on competitors by creating largecomposite 'MEGAcentre' distribution

centres to store liquor, freezers, chillersand dry goods on one site .

Collaborative projects are underway toshare forecast plans and promotion dataand help manufacturers reduce bufferstocks. Last year, Metcash went live withEANnet, which enables online tradingpartners to synchronise data and gainsecure access to pricing, promotion,trading terms and product locationinformation.

“We are supporters of EANnet andwhen suppliers come on board we'reready to go,” Ken said.

“Our ordering, invoicing and warehousesare now paperless.We still create paper,but we're fairly well advanced in gettingas much out of the system as possible."

Pay-off

CEO Andrew Reitzer told the company'sAGM that their investment in MEGADCs, picking technology, single EXE WMSplatform and supply chain projectsincluding EANnet would help achieve itsobjective of generating profit growth inthe "middle double digit” percent. Overthe last 4 years, Metcash’s cost of doingbusiness has fallen from 82.4% to 70% ofgross profit.

To read the full article, please visitwww.ean.com.au and view the onlineversion of Supply Chain LINK.

METCASH INTEGRATED SUPPLY CHAIN

More than 300 EAN membersattended the ISO seminarseries in May and learnt howto produce bar codes that scanfirst time, every time! Since then, other members keen toensure reliable performance from theirown business’ bar codes have inundatedEAN's Bar Code Verification Service withrequests for a repeat of the seminar

series. Ever responsive to the needs ofmembers, EAN Australia has scheduled afresh national road show for October2004.

The October ISO seminars are packedwith valuable working knowledge forattendees, including:

> Intricacies of bar code verification andwhy it is vital to your trading partners

> How to use a verifier and how best tointerpret the results

> The use of verifiers as quality controltools in business processes

> Trade secrets - what the majorretailers look for when assessingproduct

The interactive sessions deliver practical,hands-on experience from industry barcode quality experts. For session datesrefer to page 15 or register on-line todayat www.ean.com.au

> CASE STUDY

15

EAN EVENTDIARY

THE MOST COMMONCAUSE OF FAILED SCANS:LIGHT MARGINS

ADVANCEDTRAINING

SUPPLY CHAINMANAGEMENTTRAININGSIMULATOR

NEW

BACK BYDEMAND

The following list outlines the upcoming eventsleading up to December 2004. Keep an eye outfor further event listings in the next edition of theSupply Chain LINK newsletter.

EAN Australia Education & Training Series road show > 5th October 2004 Sydney

26th October 2004 Perth16th November 2004 Melbourne30th November 2004 Sydney

Further info: www.ean.com.au/education

Portable Supply Chain Knowledge Centre Sessions> 13th October 2004 Sydney

27th October 2004 Perth1st December 2004 Sydney

EANnet Overview & Training Sessions> 26th October 2004

27th October 200410th November 2004

ISO Verification Sessions > 14th & 15th October 2004 Brisbane

21st & 22nd October 2004 Sydney27th & 28th October 2004 Melb

Further info: www.ean.com.au/iso

EAN Australia Annual Conference> 12th & 13th October 2004

Sofitel MelbourneFurther info: www.impetus2004.com.au

EAN Knowledge Series 101TM

> EDI 101 8th November 2004> XML 101 15th November 2004> Data Capture 101 22nd November 2004> CPFR 101 29th November 2004Melbourne, EAN Head OfficeFurther info: www.ean.com.au/education

SSA Global User Group> 14th – 16th November 2004

Marriott Surfers Paradise ResortFurther info: www.muai.asn.au/combinedconf

This is the latest information available at Supply Chain LINK’s publication deadline: please visit the EANAustralia website www.ean.com.au for current detailson seminar dates, times & locations.

The space to the left and rightof the bar code is asimportant as the barsthemselves: half of all the failedscans discovered during EANtesting are caused byinsufficient light margins.Put simply, the light margin or ‘quietzone’ is the blank area before and afterthe code. If the light margin is too small,scanners find it difficult to determinewhere the bar code begins and ends.The result is a scanning failure or worse,an incorrect read leading to a case ofmistaken identity.

EAN Australia recommends going wellbeyond the minimum light margin areaslisted in its technical fact sheets.

“Don’t stick closely to the EANminimums, because they’re just that: thebare minimum and a variation of only

0.1mm could be the difference betweena successful and a failed scan,” said EANAustralia’s John Lane.

“Allow plenty of extra space so that aminor registration error or bleed duringprinting won’t eat into the light marginenough to affect scan reliability.

The same is true for computer-generated labels where run-off orplacement will affect the light marginarea.

“To be absolutely certain the bar codewill scan first time, every time, sendoriginal artwork to EAN Australia for anofficial bar code verification test.”

LINKT H E S U P P L Y C H A I N

Head Office:Axxess Corporate ParkUnit 100/45 Gilby RoadMt Waverley VIC 3149

Sydney Office:Lakes Business ParkBuilding 4B, 2-4 Lord StreetBotany NSW 2019

National Number: 1300 366 033 Email: eanaust@ean.com.au Website: www.ean.com.au