Many retailers have suffered from COVID-19 restrictions resulting in supply chain delays and, for many, a different way of conducting business. Some businesses have had to pivot to predominantly online sales. This has exposed the need for sound digital technologies.
Digital technology for the business-to-consumer relationship is extremely important. However, it’s just as important for the business-to-business supply chain. Electronic data interchange (EDI) can play a significant role in retailers’ emergence from COVID-19 and their ability to compete effectively into the future.
EDI streamlines the process of exchanging information and goods, reducing costly errors and minimising the time and cost of a transaction. Research shows EDI can reduce the cost of a financial transaction by up to 90 per cent. To maximise the value of EDI, it’s important to understand how it works and where it can deliver improvements.
Companies usually look to EDI to reduce errors from manually entering PDFs or using OCR scanning, to speed up procurement processes and reduce costs. EDI also provides visibility into the supply chain and frees up employee time and resources for other important tasks.
For those starting out on their EDI journey, the change can seem daunting. We have outlined three things to businesses should consider to set themselves up for success:
1. Understand the business outcome
Having a clearly defined outcome and understanding of what the business is trying to achieve from EDI will help ensure it stays on the right track. The outcome might be to remove manual processes, get better visibility of procurement or better manage inventory. Whatever the intended outcome, understanding what that is will ensure EDI is leveraged in the right way once implemented.
2. Understand where the business is at
The main areas that EDI will impact are software, processes and suppliers.
Thoroughly understanding where the business is at and where it needs to be, will ensure a smoother transition by minimising unexpected issues, which can drain budgets and team morale.
3. Find a partner, not just an EDI provider
Naturally, many questions will arise throughout the EDI implementation process. Having a trusted partner that the business can approach with even the smallest of questions can help shorten the roadmap from starting out to realising the outcome. The information the partner provides can be leveraged during the implementation stage, and beyond.
EDI can offer both retailers and suppliers an easier, automated procurement process, which can save money, reduce errors and improve efficiency. However, when starting out with EDI, it’s important that businesses put in the groundwork to make it as successful as possible.
John Delaney, Managing Director, MessageXchange