Data

Crunch
Report
The Impact of Bad
Data on Profits and
Consumer Service
in the UK Grocery
Industry

A report for the retail grocery

industry prepared by GS1 UK
in conjunction with:
• IBM
• The Institute for Grocery
Distribution
• Cranfield School of
Management (KTP project)
• Value Chain Vision

October 2009
 1 Executive summary

Contents
Executive summary 2 The UK retail industry is behind the The flow of information is critical to these
curve in addressing the challenge of developments. However, for some time,
Background 4
poor product supply chain data. The anecdotal evidence has suggested that
Results of the study 5 size of the quality problem is a lot worse product data in the supply chain is of
than expected, with data shown to be poor quality. To prove (or disprove) the
Critical points that reduce
supply chain efficiency 9 inconsistent in over 80% of instances. It is ‘bad data’ argument, GS1 UK compared
estimated that this will cost the industry the data on grocery products held by
Cost implications of bad at least £700m over the next 5 years, and four of the largest supermarket retailers
product data 10 a further £300m in lost revenues. and matched this against product data
The future 12 from four major suppliers.
Looking forward, consumers are
Industry next steps 16 demanding better product information The Data Crunch Project has revealed
Summary 17 and labelling for nutrition, health and that retailers are working with data
lifestyle. Planned European legislation that is inconsistent in well over 80%
Appendix is also demanding that the industry of instances. Given the current overall
Survey Results Tables 18
provides further information related to health of the grocery retailing industry,
packaging and the environment. In this it was surprising to discover such a
future world manual work arounds and high level of poor quality product data
pragmatic fixes employed currently by currently being held by retailers.
retailers are no longer sustainable.
Bad data has a severe cost impact on the
The time has arrived for the UK grocery industry in three main areas:

80%
The average level of
industry to address the data quality issue
head on, and reap the considerable
benefits.
• the cost of manual workarounds to
source missing data and correct errors
• administrative shrinkage costs in areas
such as ordering and invoicing
industry product data Accurate product data – the • lost consumer sales through shelf stock-
inconsistency bedrock of efficient supply outs.
chains
UK retailing is a highly competitive, We calculate that over the next five years
fast-moving and rapidly changing UK retailers and suppliers will experience
industry. The major supermarket chains over £700 million profit erosion and £300
have developed supply chains that million in lost sales. These are conservative
service a diverse range of outlets with estimates based on the combination
an impressive and growing selection of of process inefficiencies, duplications
products and merchandise. Margins and and workarounds across the retailer
profits are under pressure as consumer and supplier’s supply chains, together
spending is curtailed in the economic with administrative shrinkage and shelf

£235m
downturn. The supermarket groups are in stockouts that inaccurate data causes.
a fiercely competitive environment.

5 year cost of The retail sector is under constant pressure

corrections and to innovate – introducing new ways for
manual work consumers to buy (e.g. from the web
arounds for retailers and mobile devices), providing extended
and suppliers product ranges and addressing increasing
demands from consumers and legislators.

Page 2 The impact of bad data on profits and consumer service in the UK grocery industry
 Manual workarounds The solution – Global Data

£475m
untenable with data Synchronisation (GDS)
requirements set to grow The conclusion of the Data Crunch
Looking forward, the lack of efficient Project is that retailers and their
The admin shrinkage processes for obtaining, maintaining and suppliers should consider adopting
over 5 years accessing accurate product data will have GDS techniques already in use in other
a major impact on the ability of retailers countries such as the USA, Australia and
to meet increased information demands. mainland Europe.
Legislators and pressure groups are
requiring that retailers adopt higher Similar techniques can deliver benefits
standards in areas such as packaging, in the UK. However, for GDS to become
green miles, waste reduction and product the de facto way of working in the UK
sourcing. Consumers are demanding industry, major retail groups will need
better product information and labelling to move away from tactical solutions

£300m
to provide guidance in areas such as and embrace a new industry standard
nutrition, health and the environment. for managing product data where one
single, accurate, master source is used by
These demands multiply the volume all parties.
Lost sales over next
of information that grocery retailers
5 years
will need to hold for the products they
sell – from an average of 66 product
attributes today to an estimated 250
attributes in future years. This will make
the management of product data
by suppliers and retailers even more
challenging.

Without efficient processes to obtain,

66 >250
store, update and deliver accurate
product information, retailers will
continue to incur rapidly increasing
Forecast product internal costs to patch up deficiencies
in product data, and potentially suffer
attribute growth
sanctions from legislators, pressure
groups and consumers.

Industry best practice from around the

world tells us that product data should
be input once, and in most cases, this
should be by the supplier. The good
news is that sample checks of product
dimension data carried out during the
project has indicated that in 4 out of
5 instances the supplier data is more
accurate than the retailer data.

Page 3 A report for the retail grocery industry prepared by GS1 UK

 2 Background

The performance of the UK grocery for different purposes across business

supply chain compares favourably functions (e.g. buying, warehousing,
in many respects to other countries. distribution, merchandising and stores)
However, in the extent to which and across retailers, distributors and
global standards for product data suppliers. Although the data may
synchronisation have been adopted relate to the same products, it is rarely
through collaboration between suppliers managed in a cohesive and consistent
and retailers, the UK lags behind manner within individual retailers, let
countries such as the USA, Australia, alone across the wider industry.
Canada, the Netherlands and Germany.
The systems and processes in place
The UK grocery industry has changed to handle product data are basically
markedly over the past 20 years. The the same as those designed when the
market used to be dominated by grocery market was much smaller, slower
small grocery stores operating in a and less dynamic. After a new product
comparatively static environment, with is launched, there are inadequate
consistent manageable ranges of product processes to check the accuracy of data.
lines that changed slowly and physical If manufacturing processes, product
stores as the single type of outlet to the content or packaging attributes change,
consumer, with stock delivered twice there are no mechanisms to update
weekly from suppliers. the many usage points within each of
a supplier’s many hundred trade retail
The intervening years have seen the customers. In the majority of cases,
rapid expansion of mega supermarket no-one in the supplier or the retailer
chains. These huge organisations have organisation is charged with ensuring the
revolutionised the industry. They carry ongoing quality of data, or for removing
a vast variety of household product and obsolete information from master data
grocery lines, receive multiple daily, files.
just-in-time deliveries from regional
warehouses, and satisfy consumers The supply chain continues to function
through out-of-town hypermarkets, because each retailer, lacking trust in
convenience outlets, online stores, the suppliers’ data, has allowed its many
catalogues and, in the near future, by stores, warehouses and trade buyers to
mobile devices. Grocery retailing has develop a multitude of spreadsheets and
become a highly complex and fast small databases each containing local
moving business. product data created and tailored for
particular departmental needs.
During this transformation retailers
have been focussed on growth, This keeps the supply chain operating.
merchandising, aggressive pricing, However, as our survey reveals, it
streamlining supply-chain operations and has contributed to enormous data
increasing competitive share of a rapidly inaccuracies and inconsistencies which
expanding market. The retail industry has are having an impact on retailer and
not spent the time, or had the inclination, supplier profits and downgrading
to examine the product data that on-shelf availability. Apart from the
underpins so much of what they do. problems caused by inaccurate product
data, the cost of building and operating
Product data describes the characteristics these local silos of product information
of every item, case and pack bought and imposes a large and unnecessary
sold. It exists and is stored, duplicated operational cost penalty on the supply
and manipulated across departments chain.

Page 4 The impact of bad data on profits and consumer service in the UK grocery industry
 3  Results of the study

Data Crunch Process

Realising the extent to which the grocery As an indication of the scale of the data
retail industries of other countries have quality problem that the survey was
adopted GDS standards in advance of about to uncover, GS1 UK encountered a
the UK, and hearing anecdotal evidence large number of duplicate GTINs within
of poor quality product data in the UK individual retailers. Retailers provided
grocery industry, GS1 UK set out to a total of over one million records, of
establish the true situation in the UK which more than 60% were found to
industry and quantify the extent of any be duplicates. These duplications had
product data problems to be eradicated before the comparison
between the different companies could
GS1 UK gained the cooperation of commence.
eight of its member organisations and
undertook an analysis of the master data Having compared the product data held
files held by the UK’s largest supermarket by the four grocery retailers, the results
groups (Tesco, ASDA, Sainsbury’s and were then matched with data held by
Morrisons). four major suppliers (Nestle, Unilever,
P&G and Mars).
Using industry standard Global Trade
Identification Numbers (GTINs) to The high degrees of inconsistency and
uniquely identify the same products low levels of accuracy in what should
across retailers, GS1 UK was able to have been identical information were
compare the information held on significant.
identical grocery products by each of
the retail groups. The analysis, carried
out using IBM’s InfoSphere software,
was extended to examine data held on
product cases and trade packs, each of
which has its own unique GTIN.

Page 5 A report for the retail grocery industry prepared by GS1 UK

 Overall summary of product data status in the grocery
industry
The comparison of data held by retailers By contrast with retailers’ data, product
and suppliers on the same consumer unit files held by suppliers contained mostly
(individual product) and traded unit (case complete data, with only 3% of key
or pack of products) quickly revealed the attribute detail missing.
scale of the bad data problem within the
grocery industry.

Product Data Summary

Extremely low correlation of product data held by retailers

Due to data compatibility issues, the Having removed own-label, non-food
matching of data on consumer units was items, duplicate entries and discontinued
limited to three retailers. items from the master data files provided
by the three retailers, the total number of
GTINs matched across all three retailers
came to 17,889 consumer units.

The data files provided by all four retailers

had a significant amount of information
missing or contained ‘dummy entries’
(e.g. 1x1x1 size dimensions) to
satisfy system data entry validation
requirements. In order to normalise the
results, null entries and dummy data
were omitted from the comparisons.

An analysis of the 17,889 unique

items revealed an extraordinarily low
correlation between the information
held on identical products by the
three retailers. The correlation was also
extremely low when data was compared
between any two of the retailers.

Page 6 The impact of bad data on profits and consumer service in the UK grocery industry
 The TI/HI (number of cases stored
on a layer and the number of layers
stacked on the pallet) is a critical
piece of information for warehouse/
distribution planning and management.
A high level of mis-matches was found
because suppliers provide different pallet
configurations to their customers. The
main reasons for this are commercial
arrangements and warehouse limitations
(e.g. specific pallet height restrictions at
the retailer).

The one statistic which exhibited a higher

degree of correlation was the number
of consumer units per traded unit (i.e.
the number of items per pack/case or
pack size). This data forms the basis for
calculating the volume of purchases
placed by retailers on suppliers. It is
clear that more attention is paid to the
accuracy of this data, rather than to other
product attributes which impact activities
further down the supply chain.

It should be noted that even though this

important purchasing data is of a higher
quality, 10% of the information relating to
case and pack sizes remains inconsistent.
These discrepancies in traded unit data
between suppliers and retailers will
cause problems in invoice matching and
show up in apparent stock ‘shrinkage’,
unexpected stock outs, and under- or
over-payments to suppliers.

Page 7 A report for the retail grocery industry prepared by GS1 UK

 Low correlation of traded unit data between retailers
A total of 4290 unique GTINs relating to
product cases or packs were compared
across all four retailers.

There was an extremely low correlation of

pack dimensions, volumes and weights,
with less than 50% data consistency even
when comparing data from two retailers.

Additional data crunch validations

1 FMCG supplier vs. retailers
A leading FMCG supplier provided its latest dimensional
data. Only 17% of consumer product dimensional
data was matched between the supplier and three
retailers’ data

2 Manual data quality check

GS1 UK undertook a visual check of the retailers’ and
suppliers’ data to review data accuracy and consistency.
In four out of five instances, supplier data was more
accurate than a given retailer’s data.

Correlation between retailer and supplier data

The final stage of the survey matched
consumer unit and traded unit data held
by each of the four retailers with the
consumer unit and traded unit data held
by the supplier.

Less than 25% of the data held by

retailers matched with product data from
the supplier.

We discovered that the one exception

where an improved correlation was
apparent (a 43% match) was an instance
where one supplier had recently
undertaken a particular data quality
improvement project concerning product
weights.

Page 8 The impact of bad data on profits and consumer service in the UK grocery industry
 4 Critical points that reduce supply chain
efficiency

The reasons for much of the data, each department has created its
inconsistency and inaccuracy of product own local repository of information. The
data held by grocery retailers can be following chart identifies key areas where
found within supply chain processes. these separate islands of information
Different functions have different exist, and highlights the key effects they
information needs. In the absence of have on the operational efficiency of the
an accurate and standardised source of business.

Flow of goods

Factory Supplier warehouse Consolidation centre Retail distribution centre Store

Supplier head office

Flow of information Retailer head office

Supplier Retailer

Impacts: Impacts: Impacts:

Administration Depot Store

Cause Poor communication Cause A multiplicity of data Cause Incorrect product Cause Unrecognised case Cause Non scanning bar
between production and requirements across retailers life data GTINs codes at P.O.S due to incor-
supplier head office rect number
Effect Increase effort and Effect Manual checks on life Effect If the case GTIN is
Effect Incomplete and slower new line introductions dates at goods in and cost of unrecognised the consumer Effect Impact on customer
delayed new lines forms rejected goods unit is scanned and quantity service levels
visually counted. If neither
Cause Purchase order and is recognised ultimately this
Cause Unmanaged process invoice mis-match Cause Incorrect case weights can result in quarantine or Cause Incorrect each dimen-
to make changes to product and dimensions rejection sions
data after new lines forms Effect Increase workload for
have been sent finance departments and Effect Cage and trailor fill Effect Creating errors in the
delayed payments problems requiring manual Cause TiHi data wrong or planogram system and the
Effect Customer does not weighing processes and missing (TiHi = number of manual effort to correct these
benefit from latest product additional investment needed cases stored on a layer and errors
information for expensive measuring the number of layers stacked
equipment on the pallet)
Cause Product description
Effect Requirement for differences, causing pricing
Cause Incorrect case quantities manual checks and storage and replenishment confusion
issues if height exceeds in stores
Effect Impact all areas of the allowable limits ultimately
retailer business e.g. invoice this can result in quarantine Effect Additional manual
matching for finance, store or rejection effort required and shelf
ordering and depot opera- replenishment delayed
tions

Page 9 A report for the retail grocery industry prepared by GS1 UK

 5 Cost implications of bad product data

In order to understand the impact of over £140m each year and will cost over
bad product data, GS1 UK discussed £700m over the next 5 years. In addition,
the findings of the survey with we calculate that the cost of lost sales is
representatives of large retailers and £60m per annum.
suppliers. We also assembled views from
a panel of industry experts and reviewed The costs fall into 2 main areas: shrinkage
other industry reports. and workaround processes.

In total, we estimate that poor quality

data is costing retailers and suppliers

5-year cost of shrinkage

and workarounds

Shrinkage
Shrinkage is usually associated with by failures in supply chain processes. A
theft or loss of product once it has been conservative 10% of these process failures
received into inventory. The 2003 ECR are estimated to be attributable to poor
Europe report, Shrinkage: A Collaborative data quality. Our research suggests that
Approach to Reducing Stock Loss in the up to £95 million per annum shrinkage
Supply Chain*, identified that 1.75% of (£50 million in retailers and £45million in
the total retail grocery market value is suppliers) can be attributed to inaccurate
lost due to shrinkage. Of this, 27% is not product data.
attributed to consumer or employee
theft and is considered to be “paper” and
non-malicious shrinkage often caused

*
Adrian Beck, Paul Chapman and Colin Peacock “Shrinkage:
A Collaborative Approach to Reducing Stock Loss in the
Supply Chain” ECR Europe, Brussels, Belgium, 2003
(ISBN: 1 874493 92 8).

Page 10 The impact of bad data on profits and consumer service in the UK grocery industry
 Workaround processes Lost sales
No one person is responsible for The ECR Availability report* calculated
product data in the supply chain. Staff that business loses £2.4 billion due to out
in buying, stores, warehouses, logistics, of stocks. 2.5% of out of stocks** are due
merchandising and finance each have to poor quality data which is equivalent
their own particular data requirements. to at least £60 million in lost sales.
With no central point for obtaining
product data, and an historical distrust Poor product data often leads to errors
of data supplied by suppliers, local in re-supply by suppliers which leads
spreadsheets are created at numerous to stock-outs on supermarket shelves.
points throughout a retailer’s operations. Incorrect barcode labelling on the shelf
edge can mean the wrong products
A retailer may carry well over 100,000 are displayed or fail to match at the
product lines, with an average life checkout.
cycle of 2.3 years. An estimated 40,000
products change each year. Not only Inaccurate product dimensions can
does the existence of these many silos lead to lost sales and additional in-store
of manually entered product data fuel workloads if physical products do not
inconsistency and inaccuracies, the fit with the store planograms produced
hidden cost of staff maintaining the local by merchandisers. Recognising this risk,
data is significant. merchandisers will often invest additional
cost and effort in physically measuring
Inaccurate product data is a major items rather than rely on product data
contributory cause of invoice matching from suppliers.
errors. The industry estimates that as
many as 40% of invoices do not match Although some stock-outs will see
with deliveries and require manual consumers purchasing alternative brands,
investigation. Although many of these AMR Research states that in 49% of
errors are down to pricing errors, a instances an out-of-stock will lead to
significant proportion can be attributed a lost sale. If stock-outs recur, they will
to inaccurate product data. encourage consumers to seek satisfaction
from a competitor store.
Similarly, shipments of wrong items or
variations in pack configurations and Equally for the supplier, 37% (AMR
quantities lead to delivery rejections, Research) of out of stock situations will
manual investigations and repeat lead to a lost sale.
logistics activity between suppliers and
retailers.

It is estimated that the ‘hidden’ cost of

these workaround processes required
to keep the supply chain running total
over £47 million per annum (£27 million
within retailers and £20 million within
suppliers).
*
Institute of Grocery Distribution “ECR UK Availability Blue
Book 2006”, Institute of Grocery Distribution (IGD), Watford,
United Kingdom, 2006 (www.igd.com/ecr)
**
Global Commerce Initiative “Global Data Synchronisation
at Work in the Real World – Illustrating the Business Benefits”,
Capgemini/GCI, Paris, France, 2005 (www.gci-net.org)

Page 11 A report for the retail grocery industry prepared by GS1 UK

 6 The future

Industry evolution drives An additional compelling reason for

demand for more product retailers and suppliers to take action
data to improve efficiency and manage the
Retailers and suppliers are constantly quality of product data more effectively,
seeking fresh supply chain initiatives is the increasing demand for better
to speed products to market faster and information coming from consumers,
utilise warehouses, delivery vehicles governments, regulators and pressure
and shelf space more effectively. Key groups.
performance indicators funnel down to
the two imperatives – increasing sales A study of retailer new product line
and reducing costs. forms and the master data files held by
the four major retailers revealed that an
While the objectives are clear, there average of 66 attributes are recorded on
is little understanding of just how far current products. Industry trends suggest
collaboration between suppliers and that retailers will need to collate, store,
retailers, and the implementation of fresh manage and report on up to 250 product
supply chain initiatives that deliver sales attributes – a near 400% increase – within
growth and cost economies, depend on the next five years. This additional data
a solid foundation of accurate, clean and will be required to address demand for
consistent product data. information in the following areas:

Increase in attributes

Page 12 The impact of bad data on profits and consumer service in the UK grocery industry
Increase in new lines form
attributes from 66 to 250 Supply chain
Currently there are more than 200 GS1 standard attributes. On average
only 66 attributes are being used by retailers and suppliers. However,
demand and usage of attributes will undoubtedly increase in the
next four to five years as the need for additional product information
increases, e.g. promotional and price attributes, handling instructions,
traceability attributes and classification.

Health and Wellness

Demand for data, such as nutritional information and product
specification, will increase dramatically driven by the consumer and the
growth of multi-channel outlets, e.g. dot com.

Environment, Packaging and Legislation

Government, regulatory bodies and increasingly retailers (eg Wal-Mart’s
green rating) will require timely information regarding packaging waste,
detailed tax information, carbon footprint etc.

Future data challenges

Page 13 A report for the retail grocery industry prepared by GS1 UK

 Consumer health Product traceability
Consumer concerns about healthy eating Increases in the diversity of products
and allergies are placing a growing and product sourcing place a heavy
responsibility on retailers to provide more burden on retailers to track the origins
information on product ingredients – of product batches and their distribution
including eggs, milk, fish, soya, wheat through the supply chain. It is important
and nut contents. The consequences of to know the constituent ingredients of
getting such information wrong could be products so that should any ingredient
serious – for the consumer, the supplier become the subject of a health alert,
and the retailer who would be exposed action can be swiftly taken to identify all
should inaccurate data cause consumers affected products and withdraw relevant
to be harmed. Any resulting bad media product batches. To identify ingredients
exposure could have a severe impact on across the many tens of thousands of
brand image. products handled by a major grocery
chain, and to track products through the
New consumer outlets complex supply chains, it is essential that
Consumers exercising increased choice comprehensive product attribute data
are driving supermarkets to offer from the supplier be readily available at a
alternative shopping outlets. In addition central point, rather than buried within a
to out-of-town hypermarkets, there has maze of spreadsheets in local stores and
been a rapid increase in convenience warehouses, or simply missing from the
stores and online dot com outlets with entire organisation.
home delivery. As technology advances,
there will be an inevitable demand for Diversity of product and
grocery shopping from mobile devices sourcing
and, no doubt, through other as yet The variety of products sourced by
unknown channels in the future. supermarket chains is constantly
growing, with the average product life
Each new channel places fresh demands being 2.3 years. Sourcing of products
on the retailer for new sizes, packs is also becoming more complex. Fruit,
and categories of product which in vegetables and grocery products are
turn multiply the volume of product arriving from more and more countries,
information to be sourced and with different cross border taxes
maintained. This exponential demand and quotas, a variety of weight and
for data can only be managed effectively volume systems, and different labelling,
through a high quality, centralised data packaging and language standards.
management process that ensures This diversity adds to the complexity of
consistency and accuracy. product data and increases the risk of
error if the quality of data is not properly
managed.

Page 14 The impact of bad data on profits and consumer service in the UK grocery industry
 At the other extreme, supermarkets are
responding to environmental pressures
to reduce their carbon footprint by
sourcing produce where possible within
a tight radius of local stores. Small
local producers have less sophisticated
methods of measuring, shipping and
packing products and for providing
product information. Retailers will need
to accommodate these extremes of
international and local product sourcing
within their data repositories.

Environmental issues
Grocery retailers and suppliers are
faced with growing pressures from
consumers and lobby groups for
comprehensive information regarding
how products, packaging, product
sourcing and distribution logistics
impact the environment. The types and
nature of environmental information
are continually evolving, adding to the
quantity and scope of product attributes
that need to be collated, stored and
maintained.

Meeting the information demands

from consumers, pressure groups and
regulators with an increased volume
and diversity of stores, consumer outlets,
products and suppliers places a heavy toll
on the quantity, quality and availability of
product information. Couple with this the
financial imperatives to move products
faster through the supply chain, reduce
stock and maintain high shelf-availability
for consumers, and an irresistible
momentum builds behind initiatives to
improve the quality and performance of
product data management.

Page 15 A report for the retail grocery industry prepared by GS1 UK

 7 Industry next steps

How the grocery industry A series of real-life case studies

can address the demand for demonstrate that data synchronisation
product data reduces costs, improves productivity,
The need for better quality and increases sales and provides the
improved management of product data essential foundation for trading partner
is significant and growing. The current collaboration.
tactical approach of developing local
processes and fixes to work around bad The adoption of GDS has been
product data is no longer adequate and particularly strong in markets as far apart
is imposing a significant cost penalty on as the USA, Australia, Canada, France,
both retailers and suppliers. Germany and the Netherlands. In these
markets, GDS has become the accepted
The problem needs standard for the communication of
Albert Heijn, the leading to be recognised at a product data.
Dutch supermarket corporate level, with a
senior executive made The advantage of GDS for retailers and
operator, automated the suppliers is that there is only one version
responsible for data
management of its product quality. Collaboration of product data held in a central database
data as a precursor to is key and retailers and accessible by all trading partners. Instead
suppliers must move of supplying specific data to individual
full GDS. The results were to an industry standard trade customers in separate spreadsheets,
greater data accuracy, solution in which master the supplier creates one central master
improved supply chain data is created once, used file of product data which is much easier
by all, and maintained to and more economic to maintain and
processes and greater a high level of accuracy update.
collaboration with trading and integrity.
Retailers are saved the time and effort
partners. The problem is not new. they currently devote to creating their
In many countries across own product data files in separate
the world, the challenge stores, warehouses, buying divisions and
has been met by GDS merchandising departments. Everyone
Wegmans Food Markets – an internet-based draws from the same product data pool
network of interoperable which means everyone has access to
pioneered GDS in the data pools that enable consistent information.
USA. It made quantum retailers and suppliers to
improvements in the exchange standardised Because there is only one source of
and synchronised supply product information for all its trade
accuracy or product data chain data with trading customers, each supplier is incentivised
and cut several days out partners. to update information regularly and
of the administration ensure that it is comprehensive and
According to a recent accurate. This collaborative approach
processes needed to bring GS1 benchmark 30 increases the quality of product data
new products into stores. percent of global trading and engenders trust between retailers
volume is now transacted and suppliers, eliminating many of the
using master data workaround activities currently needed
synchronised through GS1 certified data to paste over cracks in the availability of
pools. accurate data.

Page 16 The impact of bad data on profits and consumer service in the UK grocery industry
 8 Summary

Our survey of the The supply chain continues to function To keep pace with these demands, and
and satisfy the needs of consumers manage product information efficiently
quality of product but at a high financial cost in manual and economically, retailers and suppliers
data held by the workarounds, a high incidence of lost will need to collaborate in automating
sales and significant product ‘shrinkage’. and centralising the sourcing,
large supermarket maintenance and distribution of accurate
chains and In the past, rapid market growth and product data.
suppliers within the expansion of the large supermarket
chains have compensated for the hidden Proven solutions exist in the form of GDS
the UK reveals a costs in keeping the supply chain and implementations of this technology
disturbing level functioning. However, growth cannot are delivering value in many countries.
of inconsistencies continue at current rates indefinitely, and
supermarket chains will need to place
To date, grocery retailers in the UK have
resisted adopting GDS. Although the
and inaccuracy. more attention on raising efficiency levels attractions and benefits are self-evident,
and streamlining activities. Improving the the major UK grocery supermarket chains
quality of product data and reducing the have viewed implementation as too
time and effort it takes to obtain, manage challenging, diverting focus away from
and distribute consistent and accurate expansion and winning share within a
information across the business will play highly competitive and growing market.
an important part in delivering these
benefits. As market growth slows and it becomes
more challenging to increase market
As the grocery industry becomes more share and profit, it’s time for the major
complex, product life cycles reduce and UK supermarket chains to take action and
consumer outlets become more varied, start to enjoy the benefits of GDS that are
the demand for faster delivery of more already proven in the grocery industries
diverse and accurate data will increase. of other advanced countries.
Additional pressures are being imposed
by consumers, governments, regulators
and pressure groups placing increasing
demands for greater information on
nutritional, environmental, packaging and
other product attributes.

Page 17 A report for the retail grocery industry prepared by GS1 UK

 9 Appendix – Survey Results Tables

The following are tabulated results comparisons with the corresponding

comparing data files received from each product files sourced from the four
of the four grocery retailers, and further suppliers.

Table 1
Exact Match for Consumer
Unit GTINs between 3
retailers

Table 2
Traded Unit Attributes –
Exact Match 4290 Traded
Unit GTINs

Table 3
Traded Unit Attributes –
Tolerance Match (5%+/-)
4290 Traded Unit GTINs

Table 4
Supplier Data Match against
retailers

Page 18 The impact of bad data on profits and consumer service in the UK grocery industry
Acknowledgements • Gary Balmer
Head of Trading and Supply Chain
GS1 UK would like to thank
Systems, Sainsbury’s
its Supervisory Board as well
as the following individuals • Fiona Blackmore
and organisations for the Supply Chain Development Manager,
time and effort that they Mars
have put into producing this
report.
• Oliver Coussins
KTP Associate, Cranfield School of
Management

• Richard Copperthwaite
UK IT Director, Tesco.com

• Peter Jordan
CEO, Value Chain Vision

• John Macfarlane
Customer Development Operations
Director, Unilever UK

• Tarun Patel
Head of Supply Chain, IGD

• Andrew Plews
Trading Systems Development
Controller, WM Morrisons

• Justin Suter
Retail Supply Chain Leader, UK and
Ireland, IBM

• Aniela Tallentire
Systems & Process Development
Manager, Asda

• Chris Tyas
Business Services and Supply Chain
Director, Nestle UK & Ireland

• Richard Wilding
Professor of Supply Chain Risk
Management, Cranfield School of
Management

• Karen Winney
Business Services Director, P&G

• Jon Woolven
Strategy and Innovation Director, IGD

Published by GS1 UK (London, WC1V 7QH) and

Cranfield School of Management (Bedford, MK43 0AL)

ISBN 978-0-9557436-9-6
Copyright GS1 UK 2009
 ISBN 978-0-9557436-9-6
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