Grocer Gets Collaborative

Item management solution bringing Food Lion closer to supply base

Armonk, NY  October 18, 2002  Retail grocer Food Lion has implemented an item management solution from IBM in a move to integrate with its suppliers and help speed products to market.

Food Lion, a unit of Brussels-based Delhaize Group, operates more than 1,220 stores in 11 Southeast and Mid-Atlantic states. The company has adopted IBM's WebSphere Business Integration for Retail Distribution, a new solution that incorporates the industry standards of UCCnet.

IBM said its offering enables real-time changes to item information infrastructures and provides a consolidated view of item attributes from multiple enterprise systems. Essentially, the system acts as a bridge between a company's existing systems and those of its key external trading partners, and it facilitates synchronized collaboration between retailers and suppliers.

Food Lion is counting on the IBM solution, along with UCCnet's item registry and data synchronization services, to enable the grocer and its trading partners to improve accuracy throughout their supply chain. UCCnet services provide an open repository for item, location and trading partner capabilities and enable retailers and suppliers to communicate new or changed product data, thereby ensuring that all trading partners are using identical, accurate and standardized item information.

The payoff for Food Lion will come in the form of reduced errant purchase orders, returned shipments, reductions, logistics systems errors and associated costs throughout the supply chain.

"With the advent of very sophisticated e-business supply chain technologies, we will be using Web-based collaboration technology to make sure we are getting the right products from the right suppliers into the stores at the right time and the best price," said Scott Harrison, vice president of merchandising services at Food Lion.

Carolyn Hager, manager for e-business at the grocer, added: "Working with IBM and UCCnet, we are building workflow processes to be adaptable and flexible to support our changing business needs. This is a fundamental evolution of our supply chain operations."

Collaboration is growing in popularity in the highly competitive grocery industry. In its recent Collaboration Baseline Study, the Grocery Manufacturers of America reported that 67 percent of the responding membership has some sort of collaborative initiative under way, and the remaining 33 percent are moving in that direction. Most of these respondents consider themselves beyond initial pilot and are beginning to invest in broad scale rollout.

In addition, technology consultancy AMR Research recently reported that 4 percent of retailers and 6 percent of consumer packaged goods manufacturers supported some real time collaborative data flows in 2001. These numbers are expected to grow to 45 percent of retailers and 47 percent of manufacturers by the end of 2003