In many ways, EDI standardized formats have simplified supply chain logistics for retailers, and put them in the driver’s seat in their relationships with suppliers. In short, if suppliers don’t comply, they don’t get the benefit of incentives, and may suffer the consequences of penalties. Suppliers who are often out of compliance will also suffer from a lack of repeat business.
But as a retailer, you know that compliance isn’t a black-and-white issue. Even after a trading partnership begins and EDI documents are tested and validated, you may modify them as your business needs change. Keeping up with changes is a challenge for sellers, and without enough advance notice on your part, the supplier may be technically “out of compliance” but still performing well. That’s just one example (a common one) of how EDI standards can easily move into “gray” zones.
There are many other potential sources of errors. Retailers who only have to deal with a handful of suppliers often find themselves allocating considerable resources to the EDI compliance effort, and those who have to monitor hundreds of suppliers are sometimes overwhelmed by the task. Frequently, staff members are shifted from clear revenue-building sales and operations jobs into compliance monitoring, which can seem like an endless game of whack-a-mole.
Supply chain monitoring is, of course, a critical task. But the obvious tools for enforcing compliance, such as deductions, can seriously hurt relationships with suppliers.
One solution to these problems is to hire a managed services provider that can provide proactive advice to suppliers and help you manage the relationship. The provider can provide real-time notifications of problems to retailers using customized alert systems. When the retailer receives the alert, it can then decide what actions to take, either internally or with the supplier. In turn, suppliers can fix issues quickly, avoiding costs to both the retailer and supplier.
Usually alerts, advisories, and other supply chain information, is provided via a sophisticated dashboard. The dashboard enables retailers to monitor all aspects of the supply chain, and can make a huge difference in ensuring consistent, reliable experiences for customers. Real-time notifications can help retailers avoid dreaded out of stock conditions, while helping to ensure on-time delivery for special events like sales.
Such real-time monitoring dashboards can be developed and monitored by an in-house staff, or outsourced to an EDI services provider. Whichever path you choose, the result will almost, without fail, help you improve your performance – and your bottom line.