Marking with the eyes of a wholesaler. AXA executives talk about the first results of the new system
Dmitry Lavrukhin - AXA CEO
Alexander Senko - Director of IT at AXAWhy did you decide to participate in the MDG Labeling Pilot Project? What criteria were selected according to the participants?
Dmitry Lavrukhin: The National Footwear Union selected companies based on various criteria, specializations, and areas, with one participant from each region, to assess how labeling would be implemented in different market conditions at all stages of footwear production and sales. For example, shoe manufacturers, importers from Russia and Europe, and even B2B safety footwear manufacturers are participating. As far as we know, the pilot project currently involves only two companies importing European footwear: us (AXA – ed.) and Caprice. We decided to participate to ensure we were prepared for July 1, 2019, and because we're interested in keeping up with the times and being the first.
How was the process of preparing and implementing all systems? How long did it take?
Alexander Senko: The pilot project is, first and foremost, an experiment, and not everything depends on us. The preparations themselves began with meetings with representatives of the National Footwear Union, where the basic principles and nuances of the future system were discussed and suggestions were made. The initial developments began in July, with integration with the GS1 RUS system implemented, but then there was a pause while we awaited guidelines from the Russian Ministry of Industry and Trade. At the end of September 2018, we received our first equipment from CRPT – an Emission Regulator (ER) (a device designed for ordering marking codes and recording information on the release of marked goods – Ed.). A little later, we set up the Task Management System – the server that generates the label with the marking code. The pilot project is currently in its most active phase: integration with our accounting systems is underway, and a system for applying codes to shoe packaging is being developed. We want to make all processes as automated as possible.
How did you work with the staff, how long did it take to study, to dive into the topic, and how many people in the company were involved in the process?
A.S.: Since there's no ready-made software product yet that integrates with the product labeling system, we're developing our own. This means we're adapting the company's existing system to the requirements specified in the guidelines and in accordance with the requirements of the Central Trade Management System. We employ a large team of specialists to implement all necessary tasks. This includes a team of programmers who are directly involved in integrating 1C with the product labeling information system. We also have logistics and warehouse management consultants, and a specialist in hardware systems for applying labeling codes to product packaging. We also have an outsourcing service that updates 1C in both retail stores and the entire central trade management system. Software development is ongoing alongside consultations with our sales specialists. Their training is already underway.
What, in your opinion, is the most difficult in the marking system? What will large and small companies face in the implementation process?
A.S.: For small companies that don't have a full-time IT staff, the biggest challenge is the lack of integration with 1C and CRPT. The accounting systems for the cash register aren't ready, but the firmware for the cash registers already exists and is ready. As far as I know, all participants in the pilot project have already implemented the integration with 1C themselves. Perhaps this issue will be resolved soon. There are a number of integrators working on development, but I haven't seen any ready-made solutions. For larger companies, the difficulties with implementing the labeling system will be related to changes in the company's business processes. They will have to make adjustments to the established system. Plus, they will be dependent on the stability of this system; if the system fails, the company simply won't be able to continue operations. For us, the biggest challenge is labeling outside of the Russian Federation, because by law, the labeling codes must be affixed before crossing the Russian border. Many representatives in Europe don't understand the scale of the system, thinking it will just be a "new label."
A.S .: The new system requires the introduction of a large amount of additional information, the recording of which was not necessary. Changes affected accounting systems, warehouse operations, workflow. Otherwise, we began to start the goods, in a new way we form an order for production. And as for our own algorithm, I can say that we are developing our own system for applying marking codes outside the Russian Federation. This hardware-software complex, which is now at the design stage, will be our product, which we plan to use in the future.
D.L .: Although at the very beginning there were many shortcomings, at the pilot project level, the system already has a high degree of readiness. We work closely with the MDGs. Various functions of the system have been tested and tested - such as working with GS1 RUS. We tested and successfully completed the ordered emissions of labeling codes and label printing, tested the process of putting goods into circulation. At the moment, we are actively cooperating with the IT departments of shoe manufacturers from Germany and Italy in order to develop a format for transmitting marking codes. A large amount of work is to integrate with the accounting systems of large European shoe manufacturers, who plan to paste shoes on their own. Now we are testing this format.
The big problem is that the labeling system will increase the burden on managers. They will need to spend more effort and time filling in the data. The workflow will become more complicated and larger, which will affect both accounting staff and warehouse workers. All participants in the trade chain will not be easy.
You are just about to provide logistics and labeling services for other companies. Where and how will this happen?
D.L .: Yes, we plan to provide comprehensive labeling, labeling and logistics services. Any company can contact us, everyone who has production outside the Russian Federation.
After the conclusion of the agency agreement, marking, delivery and customs clearance of goods will be carried out by our forces. All risks and cargo are insured. For small customers, there is the option of working under a contract of sale. We are ready to place the goods at 2 partner warehouses in Italy (Marche region) and in Germany (Berlin). We already have all the necessary equipment to automate the process as much as possible. We will begin training foreign specialists in label printing of a new sample at the beginning of the 2019 year. We plan to expand in the future.
Your list of life hacks for the transition to a mandatory shoe labeling system. What should you pay special attention to?
A.S .: Here are the top 7 recommendations from AXA on how to prepare for labeling:
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To get acquainted with the “guidelines for the participants in the shoe labeling experiment” on the website of the Ministry of Industry and Trade of the Russian Federation (www.minpromtorg.gov.ru);
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Get an electronic digital signature key, without it it will be impossible to use a marking system;
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Purchase an 2D scanner in advance, only it can read the marking code;
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Set up an electronic document management system, otherwise you will not be able to buy goods from wholesalers for further implementation;
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Update firmware of online cash registers;
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Update accounting systems to the latest version;
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On the site honestznak.rf get even more information on the marking project, if you want to register as a participant.
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