“If you are a retailer without logistics and delivery capability, you have to decide what omnichannel means to you,” says Ram Ganeshan, a professor of business at the Mason School of Business at the College of William and Mary.
The first one is a bit silly. 95% of all EDI users are spokes and they use what their hubs tell them to use. So the only companies that this can possibly apply to are Hubs. But perhaps there is a little bit more. The one that specifically comes to mind is the 820 Remittance Advice. It can be used to both inform your trading partner that they are getting paid and it can instruct the bank to make the payment (SWIFT or ACH).
Customers turn to logistics services providers (LSPs)/third party logistics (3PLs) companies because they expect them to be able to run their warehousing and transportation operations more efficiently and cheaply than they can run it themselves. These companies need to incorporate new service offerings and respond to new market requirements quickly and easily, while keeping IT costs low.
It might seem odd that EDI, data exchange technology that’s been in existence for more than two decades, is the saving grace for global commerce. But, according to James H. Davis, director of sales for Amosoft, an EDI services and solutions entity, a vast majority of all commerce utilizes EDI. “EDI is older technology that continues to be significant in today’s global supply chain,” says Davis.
We have been following DROP SHIPPING right from the first time we heard the term. We have heard many definitions and at first it sounded great. Then we realized that we still had an expensive distribution center between the factory and the customer. “Drop shipping” seemed like a synonym for “middle man”. Let's review where we are at, then propose a bold new strategy.
Opportunities abound in the retail industry; it is just a case of searching them out. Solutions and getting help are not the problem. Let's see what pops right out at us: (1) trading partner collaboration; (2) transportation management; (3) pull, don't push (4) drop-ship
All suppliers, including the ones who communicate in a clear and timely fashion, and who consistently deliver on time, need to be monitored. Compliance optimization, which includes tracking and identifying performance issues and communicating issues to suppliers, pays off for both parties. When supply chain problems are identified at a detailed level, addressed, and fixed, the retailer-supplier partnership benefits. It becomes more efficient and more profitable.
Monitoring vendors for compliance is, obviously, a key to both good business and good business relationships. Relationships between retailers and vendors are, at best, complicated and difficult; at worst, as many buyers have painfully learned, the partnership can become chaotic and nearly impossible.
EDI is the standard format for order processing and tracking in the retail industry. While every major retailer has adopted its use there are plenty of smaller and midsized retailers who haven’t yet got onboard. Fortunately for these companies it isn’t too late to start.