Electronic Data Interchange (EDI): The electronic exchange of business information using a standardized format; a process which allows one company to send order information to another company electronically rather than by paper or email.
The top 30 retailers in the US, UK and Australia will buy over 2 trillion dollars of products from their suppliers this year. Are you getting your fair share of these purchases? Do you have the EDI technology to be a great supplier to these retailers?
Imagine if Walmart wants to order $100,000 of products from you. Which type of supplier are you? Type 1 or Type 2?
Type 1 suppliers – You’ve adopted a robust inventory and order management system that has a built-in EDI connection direct to Walmart. When Walmart needs to order from you, the purchase order is immediately received electronically by you for fulfillment because the required commercial documents have been coordinated between both parties ahead of time. And, as an added bonus, your inventory system has a seamless, bi-directional integration with your accounting software, so all of the appropriate journal entries are made and your stock count has been updated, all in real time. Supplier type 1 has a fully automated sales workflow designed to sell fast and scale over time.
Or, are you type 2? The Walmart procurement rep has to manually complete your required form fields by navigating a PDF purchase order template, double check it for accuracy, and email it to you. Then your employee has to email the procurement rep several times to clarify the order details before manually entering the PO information into an Excel spreadsheet, accounting system or inventory tracker without making any mistakes. 4 or 5 days later, the order is ready to be fulfilled. As you may already know, Walmart will stop doing business with Type 2 sellers after their first experience. So, there are very few type 2 sellers left in the world.
Wholesalers and distributors who sell products in bulk to retailers have a vested interest in streamlining the sales process as much as possible by leveraging the latest advances in transactional sales automation.
Electronic Data Interchange (EDI) is the electronic exchange of business information using a standardized format; a process which allows one company to send information to another company electronically rather than by paper or email.
EDI software provides built-in templates that are used to establish unified field formats before transferring data between vendor and retailer systems, making repeat orders a snap.
EDI is an asynchronous data transfer technology that uses a file-based, batch transfer model. The standardization levels for EDIs have matured and been accepted almost universally. Experienced EDI providers maintain these standards and customize them to meet industry-specific requirements.
Adopting an inventory and order management software solution that integrates seamlessly with accounting software like QuickBooks or Xero and that offers a full service, built-in EDI capability with hundreds of major retailers is the key to quickly growing a flourishing wholesale distribution operation.
The benefits of EDI to wholesalers and their retail customers are numerous.
Wholesale sellers that choose inventory software with hundreds of pre-built EDI connections see their operating expenses shrink and sales grow exponentially. With the right inventory and order software, wholesale distributors enjoy the following:
Request a demo of Cin7 today to learn even more about the advantages of an inventory and order management system with full service, built-in EDI.
For a deeper and more comprehensive understanding of EDI, check out our extensive EDI resource here.
The next time Walmart, Target, Tesco, Costco, or any large retailer opens the door for you to sell to them, will you be ready?
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