Produce Business

Floral Traceability: The Big Waiting Game

Loading floral products onto air transport

As promising as using GTIN for floral may sound, other priorities and concerns continue to delay real-world application of the standard.

By Jodean Robbins

A change making the floral delivery system dramatically more efficient and less labor intensive is on the horizon. The movement of the proven GS1 standard into the perishable arena promises an accuracy and effectiveness never before seen in floral distribution and sales.

“Right now, there is no standard use of protocol in the flower industry,” explains Christine Boldt, executive vice president of the Association of Floral Importers of Florida (AFIF), in Miami, FL. “If the industry uses standard protocol, then each step in the supply chain can use the same barcode to move the box in and then out of their warehouses. More than 2 million companies in over 25 industries and 145 countries worldwide use [a Global Trade Item Number, or GTIN.] We are not starting something new, we are using proven standards.”

“The floral industry needs to create a common language to be used as a standard identification of cut flowers and greens,” agrees Jim Wanko, executive vice president of the Wholesale Florist & Florist Supplier Association (WFFSA), headquartered in Annapolis, MD.

Despite the positive industry chatter about floral GTIN, priorities in other perishables as well as continued concern over cost continue to delay implementation. “GTIN for floral is on our radar, but the priority is the Produce Traceability Initiative [PTI],” states Mike O’Brien, vice president of produce at Schnuck Markets Inc., located in St. Louis, MO. “There is an urgency surrounding the traceability of food that trumps GTINs in floral.”

However, as urgency related to produce safety pushes retailers to quickly implement the same GTIN system in produce, floral may benefit as well. “Implementation in other categories of business by retailers and suppliers in the channel will pave the way to floral,” states Alan Garton, director of industry development for GS1 US, based in Lawrenceville, NJ.

“We anticipate this happening within the next few years,” says Teri Miller, produce category manager with the Food Lion Family of Banners and Bottom Dollar Food, headquartered in Salisbury, NC. “Retailers are already modifying their processes and systems to address this with produce.”

Business Benefits

The implications for handling efficiencies in perishables and synchronization of systems within the retail and supply environment are what make GTIN especially attractive. “Supermarkets already have standardized GTIN/UPC barcodes on most everything else in the grocery store, but not on floral,” explains Boldt of AFIF. “So GTIN usage would put the whole store using the same barcode system. Also, using the GTIN/UPC would help identify the products for all of the suppliers and how their products move instead of using generic barcodes for all suppliers on bouquets.”

Although GTIN may make technological sense, the business benefits must be in alignment as well. “In order for the industry to fully embrace GTIN, stakeholders have to be sure such a system makes good business sense and the ROI will be significant to the future of their business,” explains Peter J. Moran, CEO of the Society of American Florists, based in Alexandria, VA.

Miller of Food Lion adds, “The GTIN and its unique format provides both the retailer and supplier the ability to eliminate cross-references, eliminate manual input, differentiate product by supplier, differentiate product movement by supplier, reduce box sizes, automate manual processes, track product through the supply chain, track shrink and effectively manage the category.”

The benefits of a floral GTIN system stretch from retail all the way down through the supply chain. “Many flowers are being delayed as they clear Homeland Security in Miami,” reports Wanko of WFFSA. “Much of the process is being done by hand with paper and pencil. The process can be sped up dramatically with use of technology — the GTIN.”

Wholesalers could see a revolution in their inventory control and pricing. “Today, very few wholesalers are able to scan in and scan out cut flowers and greens,” says Wanko. “The GTIN would allow them to do both. It would allow for better inventory control and more accurate pricing when the articles are sold. It would reduce the cost and time required to receive product significantly. In the case of wholesale distributors with multiple branch locations, it will allow them to send receiving information to the home office electronically. By scanning the boxes as they are put on the truck in Miami, the wholesale distributor will know exactly what is on that truck before it gets to him.”

“Growers and wholesalers can have a better handle on their inventories,” agrees AFIF’s Boldt. “They could add products to inventory in their systems before it arrives at their door and they could eventually use RFID to update their inventory systems by the pallet at one time. They would also be able to track back any credits by the GTIN/UPC instead of just issuing undue credits.”

Why The Wait?

Perhaps the biggest spoiler to floral GTIN implementation has been the rise of PTI, although it could end up facilitating the process as well. Says GS1’s Garton, “Once those systems are in place, retailers can easily place those requirements on the floral category. When retailers are looking at systems in the store, whether it be POS or enterprise systems, once you’re ready to receive some products using a unique identifier and all your scanning systems are ready to go, one would hope you’d be ready to quickly implement a secondary category.”

“We believe PTI can be applied to any item, not just produce and that the implementation of PTI will absolutely lead to an easier transition for floral GTIN,” says Miller of Food Lion. “As long as retailers and suppliers are committed to PTI, they will be prepared for GTIN.”

But PTI isn’t the only rogue in the GTIN process. Recognition of individual benefits remains a stumbling block for many players. “Education on the use and the process has been done over the past two years, so a majority of the industry should understand it, but change is a hard thing in the floral industry,” explains Boldt. “A lot of segments in the floral chain say they can see the benefits for others, but don’t see the real benefit for themselves.”

Concern about cost also plagues the initiative. “If each segment of the floral industry could see savings or know it won’t cost them more money to change to the standard, then more would implement it,” says Boldt of AFIF. “There is some upfront cost involved to do the numbering system for the barcodes, so many just see additional cost to change their current number systems.”

“There has to be a solid economic reason for adopting the GTIN,” Wanko concurs. “For the growers, it has to be that the majority of their customers ask for it. For the wholesale distributor, it has to be that the majority of the product they receive uses the GTIN.’”

Data synchronization and system integration also present challenges. “There is an enormous number of SKUs used in the floral industry to identify the secondary attributes of a product,” explains Cindy Hanauer, senior director of floral for Jacksonville, FL-based Winn-Dixie Stores Inc. “Things like color mixes, product mixes, seasonal mixes and packaging all come into play. In addition, there are many individual systems within the entire supply chain that touch each individual box of product from store order to customer purchase. It is imperative both the data and systems at each touch-point are accurately reflecting the products in a granular, yet efficient manner.”

Next Steps

So what is an industry member to do? “Think, as you’re building the system, about all the categories of products in the mix and what you need to do to make the entire system compatible with how you handle them,” recommends Garton of GS1 US. “Look at back-end receiving systems at the case level as well as front end POS systems and prepare sales associates for the actual scanning of the product.”

Education at all levels is another valuable step. “Retailers should be doing in floral what they’re doing with other fresh categories,” suggests Garton. “There is a need for education of staff on the Floral GTIN.”

“We should all be ready for this,” adds Hanauer. “As with any process change, especially one as far-reaching as GTIN, there are technological and organizational changes that need to be made. These changes are not insurmountable, but they require strong leadership and diligence to make them happen.”

Floral GTIN Checklist & Suggested Implementation Date

1. Obtain your company prefix: September 2009

2. Assign 14-digit GTINs to boxes: September 2009

3. Assign 12-digit UPCs to bunches and bouquets: September 2009

4. Communicate numbers to your trading partners:  March 2010

5. Put barcodes on boxes: June 2010

6. Put barcodes on bunches/bouquets: June 2010

Terminology Quick Guide

GS1– Global standards organization: GS1 is a leading global organization dedicated to the design and implementation of global standards and solutions to improve efficiency and visibility in supply and demand chains globally and across sectors.

GTIN – Global Trade Identification Number:  A 14-digit barcode, the first 7 are the company information, the next 6 are product description, and the last is the check digit which adds up the previous 13 to make sure they’re correct.

PTI – Produce Traceability Initiative

RFID – Radio Frequency Identification

UPC – Universal Product Code (aka barcode)

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