EDI and barcoding in the homecenter industry: 1992 vs. 1998

As competition increases in the $118-billion homecenter industry, homecenter retailers are implementing technologies such as Electronic Data interchange (EDI) and barcoding at the unit and piece levels in order to develop or maintain a competitive advantage. This article discusses the degree to which EDI, unit-level barcoding, and point-of-sale (POS) scanning of piece-level barcodes were used by large U.S. homecenters in 1998. The research is longitudinal in that it extends a 1992 benchmark study by Vlosky and Smith (30,31). Consistent with the 1992 study, our sample included the 500 largest homecenter retail companies (by sales) in the United States. This group of large homecenters represented 75 percent ($80 billion) of the total homecenter industry sales in 1997. Results From our study indicate that overall adoption of these technologies by homecenters increased dramatically between 1992 and 1998. In general, across all supplier sectors, homecenter respondent implementation of unit-level barcoding, POS scanning, and EDI increased by 262 percent, 236 percent, and 189 percent, respectively. When examining implementation specifically with woodproducts suppliers, homecenter implementation increased 474 percent, 353 percent, and 493 percent for unit-level barcode scanning, POS scanning wood product merchandise, and EDI relations with wood products suppliers, respectively Results also show that our study respondents implemented unit-level barcoding primarily to reduce data-entry errors and to improve inventory management and control. Respondents implemented EDI mainly to increase data accuracy, create a cost savings, and speed up product replenishment.