Immaculate Karambu

31 August 2010

At a quiet office in Nairobi's Westlands suburb sits Joseph Nyongesa, the chief executive of GS1 Kenya.

With only 10 employees the company has transformed Kenya's shopping experience such that it now takes only seconds for a scanner to list the price of items. The firm has aggressively applied bar coding, taking the retail and wholesale segments of outlets by storm. The technology has revolutionised inventory and asset management services.

"Before the introduction of barcodes, retailers and manufacturers relied on stickers to label products, a process that had a host of challenges. We have experienced a huge uptake of bar coding since it is a fast and safe means of labelling products," says Mr Nyongesa. GS1 which stands for Global Standards 1 is a worldwide standards organisation with 109 member countries, the latest entrant being Senegal which joined in May 2010.

The firm is mainly concerned with setting uniform labelling standards for member countries with a view of creating a system that eases identification and tracking of products. GS1 Kenya oversees the licensing of bar codes used by local manufacturers, retailers and asset owners among other services.

It has been in operation since 1999 and has applied changes in the coding system to conform them with global standards, hence making trading in locally manufactured products easy for manufacturers who have signed up for the bar codes.

"Kenya joined in 1999 as part of the then EAN (European Article Numbering) that operated alongside UPC (Uniform Product Code) mainly in America and Canada. However, in 2005 these companies merged due to the trade difficulties that were being experienced when products needed to be traded on both blocs ... This led to the creation of GS1," says Nyongesa.

According to Mr Nyongesa, there is a lot more than just putting bar codes on products. The company carries out other services including e-Com which is a messaging application that allows feedback to the manufacturer indicating product sales hence enabling them to know where to focus their sales efforts.

"We have an e-Com service through which messages can be sent to manufacturers and retailers informing them of product uptake. This service enables one to manage inventory and reduce waste in the form of returns while curbing product theft," he adds.

But how are bar codes beneficial to consumers?

The advantages reach further than addressing the needs of manufacturers and retailers. Consider the time one can spend in a shopping mall where the cashier has to keep checking price labels then adding all this up to produce a bill. With a bar code, all the information is contained in the specific product code and the cashier only needs to scan the item whose price is then listed alongside other shopping details while automatically producing a total bill in seconds.

The process saves time, ensuring shoppers prefer outlets where they wont find long billing queues. "In addition, many other details regarding a particular product are quickly revealed and recorded and this is helps all stakeholders in the item" adds Nyongesa.

Ultimate dream

For manufacturers, the ultimate dream would be to secure markets across the country's borders. Bar codes ensure a uniform tracking system items since they are recognised all over the world. Besides, this is the behaviour in other international markets and products without a coding system are likely to be denied access especially in developed nations.

The biggest benefit to most retail outlet owners is the reality that cashiers cannot know the price of each and every product in the store. There are bound to be difficulties if one is required to memorise all product prices. This leads to a situation where there is a misquoting of prices, causing losses.

Training users

By bar-coding products, a retailer is able to monitor the movement of the products alongside a faster system of billing for the customers, with both parties benefiting. Pricing for licenses of barcodes depends on the stability of a company and not necessarily on the number of products that one produces.

"The price range for licences is between Sh2,500 to Sh50,000 per year depending on the stability of the company in question ... stable firms pay more than small start-ups. But the price is standard and one can acquire as many codes as the number of products they deal with," says Nyongesa.

Compared to the outset in 1999, there has been considerable improvement in uptake by local manufacturers and retailers. GS1 Kenya is hoping on recruiting more outlets into the bar code bandwagon with increased exposure. "To date 3,200 companies have taken up bar codes as compared to only 150 back when we started up. In 2009 we reached 2944 firms, up from 1272 in 2004," he says.

Before the inception of the local bar coding system, manufacturers who wanted to access foreign markets were forced to acquire codes from Europe and South Africa, an expensive process.

What the company is embarking on now is training users on alternative services that they can derive from the whole system alongside carrying out awareness campaigns and on how to distinguish genuine coding systems from counterfeits.