GTIN Management: Mergers and Acquisitions
Your company is growing. The client base is increasing organically, but now it is multiplying as you acquire other businesses. Those companies had their own GTINs. How do you manage them?
Mergers and acquisitions are complicated. It is important to be crystal clear about what you are getting—and not getting. The buyer does not necessarily acquire all the assets of the seller. Read the fine print. If the purchase is complete, get your legal counsel to clarify who owns the GTINs.
GTIN Ownership
If the GTINs belong to you, there is no need to reassign new GTINs with your company prefix. However, if you re-brand acquired products significantly change the packaging, assign new GTINs. Even if the packaging is almost the same, a new GTIN may be required.
If this sounds excessive, consider these scenarios:
- There is a price difference in a product after the acquisition
- Both companies produced some nearly identical products but with slightly different formulations. Now you want to market only one product
- You are adding a certification and logo to the newly acquired products
The underlying rationale for a new GTIN assignment is easy to understand:
- A consumer or customer distinguishes a product from a previous version, or from other products
- A regulatory or liability disclosure requirement
- Supply chain changes in product shipping, storage or receiving
Old Product or New Product?
This scenario illustrates this well. You make a minor change to a product. The same ingredients are used in its manufacture but the source for one ingredient changes. However, a recall is imposed because there is a problem with the new supplier. Unless the GTIN was changed to distinguish the new product from its predecessor, you will have to recall the entire product line.
There could also be marketing reasons to issue a new GTIN: you want to test a modified form of a legacy product and see how it performs. Let’s say you are repackaging the traditional 100 tablet sales unit in a 120 tablet form. Or you are introducing it in a specific geographic, demographic or some other distinguishable market.
A new GTIN is required if you change, add or delete a price marketed directly on the product packaging. You want to be able to distinguish the former practice from the new. Anything that might trigger a market reaction should be detectable and measurable.
Reassigning an Old GTIN
What if the merger or acquisition obsoletes some GTINs? Effective December 31, 2018, GTINs from discontinued products must not be reassigned to new products. Why? Because there may be inventory of those products lurking is storage areas and warehouses for months or even years. The same GTIN assigned to two different products could be disastrous.
Let us know if you have questions or concerns about GTIN ownership, assignment or management. We can help.
John helps companies resolve current barcode problems and avoid future barcode problems to stabilize and secure their supply chain and strengthen their trading partner relationships.
A supplier has changed a product ingredient, from a synthesised version to the natural version, but they have nor changed the barcode, and I am confused as to why.
I agree with you, Neil. It is quite possible that they should change the barcode based on the changes in product ingredients. The supplier should check with GS1 to confirm this.