AS MOMENTUM GROWS FOR SOURCE TAGGING IN CHAIN DRUG INDUSTRY, CHECKPOINT EMERGES AS FAVORITE AMONG MANY DRUG CHAINS, CONSUMER PRODUCT MANUFACTURERS; Walgreens, Nation's Largest Drug Chain, Is Latest To Select Checkpoint Technology And Source Tagging Program.

THOROFARE, N.J.--(BUSINESS WIRE)--Dec. 15, 1994--"The momentum toward source-tagging will continue as chain drug stores and other retailers see the positive impact on their bottom line," says Kevin P. Dowd, President of Checkpoint Systems, Inc. (NYSE: CKP), a world leader in electronic article surveillance (EAS) and other loss prevention technologies. "Major drug store chains such as Walgreens, as well as consumer product manufacturers, recognize the need and competitive advantages that go with source tagging. It is an investment with clear, measurable benefits."

According to Mr. Dowd, the latest report from the National Association of Chain Drug Stores (NACDS), part of its "EAS Source Tagging Project," is a strong indication that source tagging will become standard in the drug store industry. "The technology is here and source tagging is now being implemented by the nation's leading drug store chains and other retailers," he said.

Walgreens (NYSE: WAG), the nation's largest drug store chain, recently selected EAS systems from Checkpoint for its stores chainwide. The Chicago-based chain already has installed Checkpoint's radio frequency (RF)-based systems in 850 stores, and expects to complete installations in an additional 1,250 stores by July 1, 1995.

In addition to Walgreens, a number of leading drug retailers have chosen Checkpoint's RF technology in the last six months, including: Arbor Drugs Inc. (NASDAQ: ARBR), Phar Mor, Drug Emporium, Inc. (NASDAQ: DEMP), Smith's Food & Drug Centers (NYSE: SFD), Osco and Save-on, which are divisions of American Stores (NYSE: ASC), and Thrifty Payless.

"The decision by Walgreens and other major drug chains to use Checkpoint RF technology, and Impulse(R) source tagging, marks a new phase in the evolution of the retail industry," says Mr. Dowd.

Leading manufacturers, including Kodak, Sterling Health and Duracell, already are delivering source-tagged merchandise to Checkpoint customers in the chain drug and other retail industries. "Thousands of consumer products with Checkpoint's RF labels have already been source-tagged by manufacturers and shipped to retailers," Mr. Dowd said. "Consumer product manufacturers and industry packagers, who have a major stake in the future of source tagging, strongly favor Checkpoint's RF technology. The combined actions of Walgreens and other drug chains as well as leading consumer product manufacturers clearly indicates their preference."

Source tagging, the process by which EAS labels are imbedded in product packaging at the point of manufacture, offers significant advantages to retailers. Traditionally, EAS tags have been applied to products at the store level by hand, at extra cost to retailers in time and labor. Source tagging programs result in significant labor cost savings, and also allow open merchandising, which encourages increased customer sales.

Checkpoint's RF technology and Impulse(R) source tagging program offer unique advantages for retailers, including non-contact deactivation, low tag cost and ease and speed of application. Additionally, Checkpoint's paper-thin RF tags can be embedded into product packaging and are virtually undetectable by shoplifters. RF tags are also easily and quickly inserted into product packaging using standard packaging machinery at speeds of 500 labels per minute.

Checkpoint Systems, Inc. is the world's leading developer of advanced microprocessor- and radio frequency (RF)- based loss prevention technology. Its electronic article surveillance (EAS) systems are installed in retail applications worldwide. The company provides fully-integrated loss prevention and security solutions for retail, commercial and industrial applications.

    CONTACT:   Robert M. Copeland,
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