Announcement: Peyton S Now Accepts EDI Price Changes (879)

Drug/General Merchandise Peyton Procurement 1014 Vine St., Cincinnati, OH 45202-1100 11310 Cornell Park Dr. Cincinnati, OH 45242

Announcement: Peyton’s Now Accepts EDI Price Changes (879)

To: DGM Suppliers and Brokers:

Kroger and Peyton’s are committed to driving costs out of the procurement process and we are excited to announce the next step to accomplish this commitment! Peyton’s will begin accepting via EDI, the 879 Price Change beginning May 1, 2006 with a cost change effective date no earlier than June 18th. By accepting an 879, Peyton will be able to process price changes through their systems much more accurately and efficiently than the current paper process allows.

How does it work? Drug/GM Merchandising will no longer require cost change information on the Peyton Change Form, but will continue to require written notification on the “Cost Increase Form”. This must be done on a timely basis to allow costs to flow through our systems effectively. Once the Category Manager and the Supplier agree on the cost change and the effective date; they will then request the agreed upon cost change to be transmitted via EDI 879 Price Change Transaction and notify the buyer of the cost change. The EDI process replicates the paper process while the 879 Price Change transactions represents an electronic price change. The inbound EDI price changes are translated and sent to Peyton’s purchasing system. Once submitted, the Peyton Buyer will verify the transmission, based on the approved cost change and effective date and notify the Category Manager the change has been entered into the Peyton Buying System. It is important to note that ALL cost changes must be submitted at a minimum of 45 days prior to the effective date. If a cost is submitted with less than 30 days, the EDI system will automatically change the effective date to be 30 days from the submission date.

How to get started? Many suppliers and brokers already communicate price changes for Kroger divisions via EDI today with great success! For those companies, this change will be an easy transition and a welcome reduction in paperwork. The 879-implementation guides/maps currently in use for Kroger should also be used for Kroger/Peyton’s. Please follow the same guidelines currently in place for Kroger on coding price changes for Kroger/Peyton’s. No additional mapping is required. Maps, details, 879 duns for Kroger/Peyton’s, testing, parallel phases and going live is posted on our site: http://edi.kroger.com

For those suppliers and brokers new to sending price changes via 879’s, the change will be a little more involved. An EDI relationship will be required. If you have an EDI solution and are not exchanging 879’s with a Kroger division, you can find the 879 maps, duns for Kroger/Peyton’s, and all 879 information on our web site: http://edi.kroger.com

If you do not have an EDI solution or are looking for an alternative solution for all EDI or 879’s alone, we suggest you contact Grocery EC. While we do not require or recommend any specific third party, Grocery EC has a proven track record and provides an affordable turnkey solution. Grocery EC;Phone: 937-429-4288;Web Site: www.groceryec.com

When do I begin? A Kroger/Peyton’s Operational EDI Contact person will contact you to provide a current price list, this must be completed before any testing can begin. They will review the start up process with you. Should you have any questions please contact:

Peyton’s Operational EDI Contact is Denise Stacy at Peyton’s Blue Ash Procurement Center and can be reached at 513-387-1188.

We appreciate your support and prompt adoption of this new business process.

Jeff Lincoln Kevin Jeff Talbot Lincoln Lutz Kevin Martin VP GM Merchandising VP HBC Merchandising Director Peyton Procurement