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Industry News - February 13th, 2009



French Pharmacies Reads Data Matrix Codes with Datalogic Scanning

Pharmacies across the entire European Union (EU) will be required to read Data Matrix codes on pharmaceutical and drug packaging starting January 2011. To ease the challenges of this transition, Datalogic Scanning developed the Magellan 1000i imager, designed specifically for use in pharmacies, while also supporting general retail scanning applications.

Data Matrix codes support both encrypted and non-encrypted data. The new codes contain more data than the current CIP codes being replaced, including the 'AMM' code, batch number and expiration date. To decode 2D Data Matrix symbols on pharmaceutical labels, intelligent imaging readers are required. To support this requirement, Datalogic Scanning developed the Magellan 1000i imager, which can read multiple 1D and 2D codes in a single presentation, or scanning motion.

Using a combination of software and firmware, the Magellan 1000i imager can sort and relay data contained in the code in a predefined order. The new Data Matrix codes are already being printed on many medicine and drug packages to ease the transition from the current bar code system.


Tesco Taking Over West Coast Grocery Market

The chain opened its first Ventura County location in Simi Valley in early 2008, followed by stores in Newbury Park and Oak Park. Its Moorpark location opened January 28, and three additional tri-county stores are scheduled to open later this year.

At this rate of expansion, Tesco's competitors have every reason to be afraid.
The British giant currently has 34 percent market share in Britain, almost double that of Asda, a Wal-Mart subsidiary.

Tesco's December 2 quarterly report said group sales rose 11.7 percent for the 13 weeks ended November 22, compared to the same period the previous year. This was due in large part to the company's solid international operations, which reported revenue growth of 28 percent.

Despite Tesco's success, the sluggish economy has forced Fresh & Easy to delay some of its store openings.

Analysts have said Tesco's utilization of customer feedback is a skill that sets the company apart from the U.S. retailers.

Tesco employs 280,000 people in the United Kingdom and 440,000 worldwide. The company has operations in international markets including China, the Czech Republic, France, Hungary, Japan, Malaysia, Poland, Ireland, Slovakia, South Korea, Thailand and Turkey.


1-800-FLOWERS.COM Adds New E-commerce Platform

1-800-FLOWERS.COM selects IBM to provide its new e-commerce platform. Based on IBM WebSphere Commerce, the platform will help 1-800-FLOWERS.COM reduce its paper catalog footprint and build its online business by delivering a rich, one-stop resource for customers to purchase flowers, gourmet foods and gifts.

The company launched its first brand on the new platform, The Popcorn Factory (www.thepopcornfactory.com) in November and has seen its conversion rate rise and customer experience feedback improve. The conversion rate metric tracks the number of site visitors who make a purchase.

Using knowledge gained from this first rollout, 1-800-FLOWERS.COM plans to transition most of its 14 brands to the new platform over the coming few years, providing the company with added agility to respond immediately to both customer requests and competitive offers.

"We went from Web 0.5 to Web 2.0 in just nine months and we could not have made that happen without the support of our IBM Global Business Services team," says Steve Bozzo, chief information office for 1-800-FLOWERS.COM. "I am particularly impressed with our new one-page checkout system that offers our customers an unparalleled buying experience."

Today, the company has several of its gift brands running on independently siloed systems. For consumers, this means searching several different 1-800-FLOWERS.COM Web sites for a gift. For the company, it means spending too much time managing and updating its e-commerce applications - a costly and resource-intensive process. The new platform allows 1-800-FLOWERS.COM to add new brands, including those from acquired companies, quickly under a program it calls Fresh Digital. Also, Fresh Digital is helping the company merchandise, market and test new ideas quickly both on the Web and through more relevant email campaigns.

With the new IBM platform, 1-800-FLOWERS.COM is able to meet the changing requirements during peak holiday times including Valentine's Day and Mother's Day. Brand marketing teams can merchandise and update Web sites without help from the IT department, for example, allowing the company to act more quickly with product introductions, marketing promotions and special offers.

"Knowing that business is changing rapidly, we needed a platform to support our flexibility and growth," said Jim McCann, founder and CEO, 1-800-FLOWERS.COM. "The WebSphere Commerce platform allows us to achieve our vision better. Tearing down the silos enables us to market much more effectively."

IBM Power Systems servers running AIX and PowerVM virtualization software were chosen to host the new platform. Additionally, 1-800-FLOWERS.COM selected IBM WebSphere Message Broker as the middleware for the Fresh Digital Platform. With IBM WebSphere Commerce and IBM WebSphere Message Broker, the Fresh Digital Platform is enhanced to more easily support the on-going requirements of 1-800-FLOWERS.COM. Multiple 1-800-FLOWERS.COM brands can now run on a single system and integrate with back end transaction systems.


Elie Tahari Identifies New Fashion Trends with Business Intelligence

Elie Tahari deploys business intelligence technology from IBM to help gain greater visibility into customer buying habits, merchandising and supply chain to make better use of information and become more responsive to customer needs. Since implementing the system, the retailer has been able to more effectively target new customers and boost sales by more than 10 percent, while cutting operation costs.

As a fashion designer with global operations, Elie Tahari's collection changes from season to season throughout the year. It was critical for the retailer to get better visibility into their supply chain to keep up with customer demand for changing clothing line based on season's trends and geography. With business intelligence from Elie Tahari, the retailer has been able to achieve more than 30 percent savings in managing their supply chain and transfer of merchandise from warehouse to the stores.

To date, the software has helped Elie Tahari employees gain better visibility into business information, such as trends around customer orders. The software helps identify best selling sizes across product lines, popularity and demand for a particular item, or colors in fashion for the season. For example: based on gaining visibility into previous operations they are now able to predict upcoming demands - the retailer can now anticipate a high demand for "yellow halter dress" for the spring season in New York and would now be able to get the right amount of dresses with the right sizes available in stores in New York.

In addition, the IBM software also helps reduce the risk of manual reporting errors by moving to a new electronic system. In the past, it would take days for information to be manually compiled, that information is now updated every 5 minutes and can be viewed by all departments across the company, irrespective of location in any part of the world. With real-time access to information across their stores worldwide, channels and supply chain, retail managers, designers and merchandisers have detailed information on buying patterns in different parts of the world, so they can ensure they have the optimal assortment of merchandise to satisfy customer needs.

"The IBM business intelligence system has significantly helped us gain visibility into our customers' needs," says Nihad Aytaman, director of business applications, Elie Tahari. "With efficiencies that have been brought into our day-to-day transactions, this system has saved Elie Tahari several millions of dollars annually and has paid for itself many times over. IBM technology has helped us bring the kind of innovation in the high fashion industry that is helping us position ourselves better than the competition by creating brand loyalty for our products."


Borders Restructures Corporate Management, Eliminates Positions

Borders Group announces that as part of its effort to drive further expense reductions, the company is consolidating its corporate management structure at the vice president and director levels, eliminating six vice president and 10 director positions. The majority of the affected positions are based at the company's headquarters in Ann Arbor.

Specifically, Borders Group has eliminated the role of Executive Vice President of U.S. Stores held by Ken Armstrong, who joined the company in 2007. Steve Davis, Senior Vice President of Borders Group Operations, who has been with Borders Group for 15 years in a variety of operations management positions, will take on leadership of the store operations group. In addition, the post of Senior Vice President and Chief Information Officer held by Susan Harwood, who joined Borders Group in 2007, has been eliminated as the company recently shifted information technology under the leadership of Dan Smith, a 14-year Borders Group veteran who was appointed Chief Administrative Officer one month ago.

Within the Borders.com team, the position of Senior Vice President, E-Business held by Kevin Ertell has been eliminated as the company will now consolidate its online presence - including e-commerce and its popular Borders Media video programming - under the leadership of Rich Fahle. Fahle will now serve as Vice President, Borders.com. He has been with Borders Group for 10 years, most recently serving as Vice President, Content. Fahle is the originator of the Borders Media online video programming and has e-commerce experience with Borders, holding leadership positions beginning in the late 1990s within the company's initial Borders.com organization.

Other changes at the vice president level include the elimination of the following positions: Vice President, Real Estate; Vice President, Human Resource Services and Vice President, Creative. In addition, Fred Boehler, Senior Vice President, Logistics, has announced he will be leaving Borders Group. These business areas will continue to be supported by existing personnel as functions are consolidated under the revised business structure.

At the director level, the 10 eliminated positions include posts based outside the corporate office - such as the roles of Sales Director and Waldenbooks Specialty Retail Regional Director - as well as director posts at the corporate office within various departments including Paperchase gifts and stationery, merchandise strategy, merchandise planning and replenishment and national event marketing.

"As we address the immediate priority of getting our company's financial house in order, one of our goals is to more aggressively reduce annual expenses," said Borders Group CEO Ron Marshall. "It is difficult to make the decision to eliminate jobs, especially those of talented and dedicated leaders who have significantly contributed to our organization, yet streamlining our leadership and eliminating management layers will help us be more agile and at the same time advance us toward our expense reduction goals."


Shearer’s Foods Goes Live with E2e Supply Chain Suite

Shearer's Foods goes live with RedPrairie's entire E2e Supply Chain suite in their Navarre, Ohio distribution center. Shearer's chose RedPrairie for its Warehouse Management (WMS), Transportation Management (TMS) and Workforce Management (WFM) application.
Shearer's also plans to roll out the software package at their Lubbock, Texas facility in the coming months.

"Our method of moving product from warehouse to shelf operates through an extended distribution network and direct store delivery (DSD)," says Scott Heldreth, Shearer's vice president of logistics and information technology, "So the solution we chose had to manage our main manufacturing facility's distribution center, our workforce, and our remote distribution centers - all simultaneously. RedPrairie's E2e Supply Chain suite had the tools we needed to manage the backbone of our supply chain operations efficiently and effectively."

By providing better supply chain visibility through the information capture, analysis and graphical display, the E2e suite can help improve efficiency across an extended supply chain network.

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