The Roundtable
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The Roundtable is where editors and experts meet to discuss key issues facing the global transportation and logistics community, from the highways to the high seas. It's an open forum, and you can comment on posts. If you'd like to be a Roundtable blogger, contact Dana Brundage at dbrundage@joc.com
Wednesday, June 3, 2009
The bar code is a small thing, but it’s changed our lives in a big way.
Today the ubiquitous Universal Product Code bar code, with its 59 machine-readable black and white lines and 12 digits, officially turns 35. Without the bar code, many supply chains would simply snap — along with tempers in supermarket checkout lanes.
The UPC bar code ranks high on the list of technological innovations that changed not only our economy since the 1970s but our day-to-day lives.
“The UPC (bar code) made the modern retail store possible,” says Rodney McMullen, vice chairman of The Kroger Co., which has more than 4,000 stores across several retail chains. “It allows us to carry tens of thousands of items in a given store and move shippers through quickly while offering them many different ways to save money.”
It’s hard to understate the lowly bar code’s importance to supply chains and global trade.
It changed distribution in much the same way the microchip changed electronics, leading to the development of much more complex supply networks — rather than high-tech products — at a much lower cost. Your diminutive notebook computer, after all, came in a box with a bar code.
Without the bar code, there would be much less supply chain visibility — if any. Radio frequency identification technology has yet to replace bar coding as an inexpensive and easily deployed form of product identification. And although the UPC bar code is used only for products sold in the United States and Canada, it is part of the system of Global Trade Item Numbers used to track goods around the globe.
Now, some things you may not have known (I certainly didn’t):
* The first live use of a UPC bar code took place on June 26, 1974 in Troy, Ohio, when a cashier at a Marsh Supermarkets store scanned a packet of Wrigley’s gum.
* Thirty-five years later, more than 10 billion UPC bar codes are scanned each day.
* More than 200,000 U.S. businesses in 25 industries use UPC bar codes.
* Bar codes save the grocery industry alone more than $17 billion a year, according to one estimate.
* Each UPC bar code has three elements: the brand owner’s company prefix, the specific items reference number and a “check digit” to ensure accuracy.
* All UPC bar codes are administered by one non-profit organization, GS1 US.
“The UPC is really fundamental to commerce,” says Bob Carpenter, CEO of GS1 US, which celebrates the UPC bar code's 35th anniversary today with a giant bar code-shaped cake served up at its annual conference in Orlando.
“It took time to build momentum, but it has succeeded because it benefits everyone: consumers, retailers and manufacturers. And it has a lot of life left in it.”
You may download a colorful history of the UPC and GS1 at www.gs1us.org/overview.
The mood at The Journal of Commerce's Breakbulk Europe conference in Antwerp wasn't giddy -- probably a good sign -- but it didn't have the gloom that surrounds most container shipping gatherings these days.
Volumes of several key breakbulk cargoes, notably steel, have plummeted with the economy. Albert Counet, CEO of Brussels-based Xpedys, said his comapmny's volumes are down 40 percent year-to-year, largely because of reduced steel shipments. Geert Pauwels, group coor4dinaror at BC Cargo Group, the freight division of Belgian railway SNBC, reported a similar drop in breakbulk business.
But some breakbulk cargo segments are holding up well. Northern European ports report increased volumes of aluminum shipments being stored under London Metals Exchange contracts. And project cargoes -- which include high and heavy shipments that don't fit in containers -- have held up relatively well.
Multimillion-dollar construction projects aren't turned on and off like a water spigot, and carriers are still moving many projects from contracts signed several years ago. Many at the conference said various projects are being slowed or in a few cases canceled. But generally the business is carrying on. Arjan Prooij, logistics manager at Fluor bv in the Netherlands, said Fluor has a backlog of $29 billion in expected businsss worldwide.
"We'll ride the wave," said Gary Dale Cearley, executive director of the Global Project Logistics Network in Bangkok, whose 100-plus members are involved in project logistics worldwide. He said he expects demand for project cargoes to soften with the economy, but he doesn't foresee a complete bust unless key currencies "go haywire" as Asian currencies did in the late 1990s.
"The long-term fundamentals are in place and globalizatoni will not go away. It will increase," said Axel Bantel, vice president and head of commercial and supply chain management for Europe at Wallenius Wilhelmsen Logistics.
Besides carrying industrial products and commodities that are less subject to consumers' whims than container carriers are, breakbulk carriers also enjoy a better supply-demand balance on vessel capacity. Although the size of the breakbulk fleet has increased, it hasn't gone through the ordering binge that has battered container lines.
