MDGT appointed as operator of a shoe labeling and traceability pilot project

Starting from 1 on June 2018, a pilot project on shoe marking will start in Russia. The system operator was appointed a subsidiary of the Center for the Development of Advanced Technologies “Operator CRPT”, created to implement the Unified National System for Digital Labeling and Traceability of Goods Honest SIGN. The “MDCT Operator” will determine the requirements for the information system and the requirements for ensuring the protection of information contained in the system.

The experiment is conducted to test the basic algorithms for interaction with market participants. It will allow the industry to make the transition to mandatory labeling as comfortable and efficient as possible. The experiment will last until 30 on June 2019 of the year, and the mandatory marking of shoes will start on 1 of July 2019 of the year in accordance with the Order of the Government of the Russian Federation of April 28 of 2018 of the year No.792-r “On Approving the List of Goods Subject to Mandatory Marking with Control Marks”.

The technological platform of the pilot project will be the national Honest SIGN system. It is already being introduced in the pilot for the labeling of tobacco products and can easily scale to new product categories.

The working group of the experiment included key players in the shoe market — manufacturers, logistics companies, and retail — among them are Kari, Zenden, Sportmaster, Clothing House, Egorievsk-Obuv, Kotofey, Asia Trade Company, Moscow Order of the Red Banner of Labor Shoe Factory Paris Commune, Logistics Company Akfa, LS Import, Obuv Rossii, Kapris-Vostok, Vostok-Service, Tandem, Tandem Tekhnoavia, Aksa.

“A few months before the pilot began, we began to work out the basic technological issues with the business and are grateful to the“ pioneers ”of this project for their active participation in the work. The experience of conducting an experiment on labeling tobacco will allow us to pilot in a new product group without serious technical difficulties. The real interest of market representatives gives us confidence that the time allotted for the project will be enough for a comfortable transition to mandatory labeling, ”said Mikhail Dubin, Chairman of the Board of Directors of the CRTC.

During the experiment, manufacturers or importers will put a two-dimensional Data Matrix code on a shoe box or product label if there is no consumer packaging. After the formation of the final order for the supply of goods, the manufacturer or the importer will be able, if necessary, to carry out all aggregation and disaggregation of group packaging operations to simplify the delivery of goods, the official press release says.

Unlike tobacco products, the consumer can return the shoes back to the store, the system will recognize such goods and return it to circulation. Another difference between the labeling of light industry and tobacco is a large share of imports of goods to the Russian market. For this, the Center for the Development of Advanced Technologies will ensure the marking of goods before placing them under customs procedures. The format of interaction with importers will be worked out during the pilot project.

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Through a digital code, you can trace the entire path of each pair of shoes - from production to the withdrawal of goods from circulation. The system records the transfer of goods from owner to owner at each stage of the supply chain, which makes it impossible to throw in illegal products. The withdrawal of goods from circulation will be carried out by obtaining information from the fiscal data operators in retail, wholesale, sale through the Internet and through data transfer using the interface of the project information system.

The Center for the Development of Advanced Technologies has all the necessary competencies and resources for the implementation of a pilot project. World experience in implementing projects on labeling and traceability of goods shows that most often a private operator is involved in launching and further maintaining such systems. The state seeks to attract a single operator for various industries, which gives a synergistic effect. The MDCT, as the operator of a unified national marking and traceability system, independently generates or “creates” a marking code, is responsible for its protection, and at its own expense develops and operates the system platform.

It is important to note that during the pilot project, the code generation service will be free for all its participants.

The project organizers suggest that the transition to digital labeling should lead to a reduction in the cost of goods for customers by 10% in the most conservative scenario. This will happen due to an increase in the market share and production volumes of legal manufacturers due to withdrawal of illegal products from the market. Also, cost reduction is affected by: increasing the efficiency of the distribution network, reducing the margin, optimal production planning and increasing product turnover, significant savings in logistics on operating costs and other advantages of Just-in-Time production. In addition, the project provides protection for the brand and the reputation of legal manufacturers.

Recall that on April 28 of 2018 of the year, the Russian Government approved a list of goods subject to mandatory labeling from the 2019 of the year. Among them are tobacco products, shoes, perfumes and eau de toilette, knitted blouses, coats and short coats, raincoats and jackets, windcheaters and wind-shelters, bedding, table, toilet and kitchen linen, cameras and flashlights, tires and pneumatic tires. It also defines the model by which the marking system and basic requirements for it will work.

Advanced Technology Development Center created to implement large-scale projects in the digital economy, forms the necessary expert and technological infrastructure for such projects. The MDCT is a joint project of USM Holdings (Peter-Service, 50%), Rostec Group of Companies (Avtomatika concern, 25%) and Elvis-Plus Group A. Galitsky (25%). The center has exceptional competencies and opportunities to bring innovative technological solutions to the market. The MDCT, on the basis of a public-private partnership, implements a system of digital labeling and traceability of goods in Russia and the EAEU. It will make the commodity markets transparent and create a full-fledged system of guaranteeing the authenticity and quality of goods. The technology effectively fights against illegal goods, protects consumers and fair business. The center is defined by a single operator of the experiment on labeling tobacco products, develops a digital code technology without a special carrier, product traceability throughout its life on the market, organizes the localization of production of labeling equipment, works on the creation of a single catalog of goods, participates in the creation of the concept of labeling and traceability for the Eurasian Economic Union, is engaged in the production of fiscal drives for online cash registers.