EDI can be pivotal to creating competitive value for the retailer.
Retailers have enjoyed the benefits of EDI for years. However, there is still a great deal of potential for EDI to deliver more to the retail industry. Retailers now face a competitive marketplace of easy online price discovery and multiple options for delivery.
Vendor Managed Inventory (VMI) has become the driving force for the industry to continue to look at ways to cut costs, yet maintain or improve customer service. The supplier makes the main inventory replenishment choices for the consuming organization. With VMI, you have great control of your inventory. This leads to less waste. Less wastes leads to quicker replenishment from monthly to weekly – or even daily! Greater control plus less waste equals increased and improved customer service. This becomes even more important when weekly promotions put an increased demand to have stock readily available.
Two additional key roles for EDI are:
- Streamline the Direct Store Delivery (DSD) , the key method of selling and distributing product to a variety of industries to the end user.
- Global Data Synchronization Network (GDSN) which enables various trading partners to automatically share their business data with each other. The GDSN uses the GS1 system and Global Trade Identification Number (GTIN). Additional information can be found at GS1.
These key roles can also lead to challenges. Here are the top 3 challenges:
- Margins must be protected. EDI provides automatic review of prices on customers’ purchase orders. A missed $1.00 on 100,000 orders is serious money. The hidden challenge is promotional pricing – both the lower price and the start/stop dates. You need to:
- Enter the promotional details before the orders arrive.
- Automatically scrutinize to ensure the correct details are on the customer’s P.O. Shipping after the stop date at the wrong price can be avoided.
- Ship-to homes – ensure you get the correct credit for returned items, which can exceed 1/4th of the shipments. Similarly, for ship-to store for customer pick-up, ensure the customer contact details such as name and phone number are treated as securely as patient medical records.
- Make GTINs differ by customer for the same item. Mobile phone bar code scanning leads consumers to the lowest priced merchant. The aggregation of business with the lowest cost merchant sharply cuts margins.
Data Communication Solution (DCS) has the experience to assist you with these EDI challenges and more. Contact us at info@dcsedi.com.