What role does EDI play in logistics and supply chains?

Logistics was coined by the military to describe the complicated organization involved in moving troops and equipment from one place to another. Similarly within the supply chain, logistics is about getting everything from goods to equipment to people from one place to the other. Logistics is no easy matter. Things have to be in place when they’re needed, and they have to be there in the right quantity.

Vast in scope, both the supply chain and the logistics within it involve all the departments of a company and outside entities. This includes manufacturers, suppliers, distributors, wholesalers, and retailers. A great deal of information has to be passed back and forth between all of these entities. Basically instructions, this information is about the goods and raw materials needed, the quantity they’re needed in, where they’re needed, and instructions about transportation. These instructions take the form of purchase orders (POs), invoices, shipping notifications, insurance documents, licenses, and more. For large-scale logistics operations, transmitting these documents between companies is best handled electronically, through a digital system called Electronic Data Interchange (EDI).

 

What is EDI, and how does it work?

EDI enables businesses to send digitized documentation directly from the computer of one company to the computer of another company. In order to be able to do this, and to do it instantly, EDI software converts these digital documents into a standardized format that allows them to be first transmitted, and then read, by the computer system of the receiving company.

There are three stages to EDI:

  • Preparing documents, making them EDI ready.
  • Converting the EDI-ready documents into EDI documents.
  • Transmitting the converted documents to the receiving company.

Preparing in-house documents

The POs, invoices, and shipping instructions are either digitized or collected from their digital storage and converted to an electronic file that has the information needed for EDI. This makes them EDI ready.

Converting the EDI-ready documents

This is done with an EDI translator, software that puts the documents’ data into globally-recognized EDI formats. While there are quite a number of these formats, there are four that are used the most: X12, EDIFACT, TRADACOMS, and ebXML.

Transmitting the EDI documents

For this to happen, EDI messaging protocols are used. Examples of these are AS2, OFTP, and SOAP. For the EDI system to work, both sender and receiver have to be using the same protocol.

 

The role EDI plays in logistics and the supply chain

  • It saves time.

EDI software gets documentation to the relevant companies and departments within companies quickly, keeping them on the same page and the wheels of the supply chain running efficiently. This speedy communication makes it easier to forecast needs and results in better business decisions being made.

  • It makes the supply chain process more efficient.

With EDI, suppliers, distributors, shippers, and every other entity that’s part of the supply chain can communicate with each other in real time. This cuts out chances of delays happening in receiving, dispatching, warehousing, or transportation.

  • It makes it easier to monitor and track goods.

Because EDI uses a uniform format, it’s easy for relevant parties to search for information, and it’s easy to track and keep on top of purchases, orders, and bills of any kind. As a result of this, you can reduce errors in purchasing and shipping.

  • It streamlines logistics and the supply chain.

EDI is able to retrieve data from internal computer systems instantly and send it out securely. When you automate POs, invoices and the like with EDI, it speeds everything up and reduces errors, streamlining your supply chain.

EDI software integrates seamlessly with in-house systems like Enterprise Resource Planning (ERP), accounting software, your Warehouse Management System (WMS), and Customer Relationship Management (CRM) software.

 

How Cin7’s EDI helps supply chain management and logistics

Cin7’s EDI capabilities are robust, and the system has a large EDI network. A one-stop-shop, Cin7’s system will get you:

1. Automated workflow

Cin7 EDI automates order processing and shipping by:

  • Setting triggers for automation and reducing manual data entry.
  • Using an advanced messaging system that streamlines integrations with your trading partners and 3PL warehouses.

2. A one-stop-shop automated system

Cin7’s inventory management software has it all, inventory management, order management, and EDI. When businesses set up their EDI with Cin7, they can:

  • Seamlessly manage orders and scale up your business.
  • Reduce shipping costs and save time by optimizing cartons. Print Serial Shipping Container Code (SSCC) and generate Advanced Shipping Notifications (ASNs).
  • Keep their product catalogs up to date and track orders in real-time with a centralized and intuitive EDI dashboard. You’ll have absolute inventory control, and your order fulfillment will be at its optimum level.

3. Multiple fulfillment models

Cin7 EDI supports ship-to-store and 3PL.

  • Integrate with product distributors, 3PL providers, and commerce channels.
  • Fulfill orders effortlessly with an intuitive EDI dashboard.
  • Fulfill several orders simultaneously with a cartonization feature that picks the right box for items.

4. Prebuilt-in EDI mapping and protocols

  • Map order workflow between yourself and trading partners around the world.
  • Send EDI documents with these protocols: X12 American National Standards and EDIFACT- European Standards.

 

Summing up

We’ve shown how EDI facilitates both the supply chain and the logistics that move it along by producing and transmitting documentation quickly. EDI eliminates mistakes that can be made when people input data and ensures that different players in the supply chain are kept in sync by getting the same information, at the same time.

To learn more about Cin7 EDI, book a demo.

Application integration and the significance it has for inventory management software

In today’s automated world, retail and manufacturing companies control their business processes with several different software applications, each of which performs a specific function. For instance, there are applications for accounting, supply chain management (SCM), and inventory management (IMS). While they’re separate and perform their own clearly defined tasks, it’s vitally important for them to communicate with each other and for the data they use to be passed between them. Simply put: If your SCM can’t pass its data on to your IMS, information about your stock would have to be input manually.

When these different applications are able to communicate, you have application integration.

 

Different ways application integration can be performed

Application integration sounds simple enough, but there are four basic ways it can take place.

Data level integration

Called data level integration, this method puts the data stored in each application into a single, separate database. This separate database is called an enterprise database or an enterprise database repository. To create this centralized system, the data stored in each individual application are extracted, cleansed, and reformatted to be consistent with whatever standard the enterprise database uses. From that point, individual applications can tap into the central system to get the data it needs.

This method is the lowest-cost application integration due to the minimal amount of programming needed to set it up and the speed with which that can be done. Data level integration only takes the data an application stores, not the coding of the application itself.

Application interface level

Known as application interface level, this method doesn’t have a centralized database that stores everything. Instead, data extracted from one application are converted into a standardized format and then loaded directly onto the target application. Hence, application to application.

Application interface level is currently the most popular method for data sharing because most application codes now provide interfaces. Cin7’s IMS, for instance, offers over 700 integrations, and new integrations are being added regularly.

Method level

Here, it’s not data that are shared, but business functions. This may sound precarious, but the actual business functions are not included in the code that’s passed along. An evolving way of exchanging data, method level is promising because it’s compatible with technologies like Java RMI, DCOM, and Cobra. A big drawback, however, is that the application code has to be changed before it can be used.

User interface

User interface (UI) is about having the different applications designed in such a way that users (human) can log on to their company’s network and bring up the data they need from any computer in the network. Application codes don’t have to be changed for this method to work  – a factor that makes the cost minimal – but that also gives it less flexibility.

Benefits of application integration for inventory management software

When it comes to inventory management, application integration is essential. Having the ability to input data from other applications into IMS software or passing the data it stores into another system, and being able to do so accurately and quickly, is vital to business operations. The benefits are:

Inventory optimization

Inventory optimization, or having the right amount of inventory, means carrying enough to fill orders and prevent stockouts, while not having too much of it.

If your inventory management software is integrated with accounting and ecommerce applications, you’ll have a clear idea of the quantity of items you should be warehousing as well as information about which actual items you should stock. You’ll also be alerted when you need to reorder.  This means less worry about overstocking or understocking.

Making good financial decisions

Information about how well certain goods have sold in the past and predictions about how well they’re expected to do going forward informs decisions that are made in the present. In order to get this information, reports and forecasts have to be accessed from several applications in real time.

When this information is available to IMS systems, better decisions can be made about which stock to carry. Additionally, application integration with a variety of systems makes audits more accurate. You’ll be able to verify that the stock listed in your books is a real reflection of the goods you have in storage, and you’ll have complete information about items that are in transit.

 

Types of integrations available on Cin7

There are more than 700 integrations in Cin7’s software, but they can be categorized into the following business operations:

Accounting apps

Accounting software records and manages your financial transactions, everything from purchases and sales to operating costs and payroll. Cin7’s system can integrate popular accounting software like QuickBooks Online, Xero, and QuickBooks.

Ecommerce platforms

Cin7 can integrate with ecommerce platforms that include Magento, WooCommerce, Shopify, and others. If you’re selling through any one of them, IMS integration will give you oversight and let you know how your sales are going. If you’re selling items through more than one of these ecommerce platforms, Cin7 will allow you to integrate their data and accounts into a single platform on your system.

EDI retailers

Electronic data interchange (EDI) is the system through which documents like invoices and purchase orders are transferred electronically. There are several electronic standards to choose from for these exchanges, but whichever one is used, both sender and receiver have to be using the same one. Cin7 can facilitate most of them. Some larger retailers like Scheels, Sears, Sephora and Walmart have their own EDI systems, and Cin7 can be synced with them also.

EDI suppliers

EDI suppliers are organizations that provide EDI-compatible solutions and technologies to other companies. Two of the leading suppliers are Synnex and Tech Data, and Cin7 can integrate seamlessly with both.

Marketplaces

If the website you’re selling your goods through is charging you commission for each sale, you’re on a marketplace. Marketplaces are a good way to get your product out and make a name for yourself, especially if you have a new company or are small in size. To keep on top of your business in these marketplaces, you’re going to have to integrate them with your inventory management system. Cin7 can do this for all the major marketplaces, including Amazon, Etsy, Iconic, and eBay.

Payment gateways

When you sell online, you need a payment gateway to process payments. You also need to integrate this payment gateway with your IMS. More than just getting paid for your goods, integration with your IMS streamlines their flow and ensures you have enough in stock.  To make this easy, Cin7 can integrate with payment interfaces like PayPal, Dejavoo, EVO Payments, and others.

Sales and marketing

Sales and marketing software uses technology to get your advertising to the right audience. That means customizing and posting it on social media and other pertinent sites. To facilitate this, Cin7 inventory management software integrates with Customer Relations Systems (CRMs) such as Salesforce, Mailchimp, Senter, and HubSpot.

Shipping

The very nature of ecommerce involves shipping. Goods that are purchased online have to be physically transported to their buyers. If you hire a third-party to take care of this shipping, you still have to keep track of the items and maintain your records. Cin7’s software can integrate with shipping partners Shippit, GoSweetSpot, Shiptheory and many others, ensuring you’ll always have the information you need at your fingertips.

Supply chain planning

The supply chain covers every step in the fulfillment/manufacturing process from purchasing and inventory management to sales and deliveries. To organize all this in the best possible way, Cin7 integrates with supply chain planning apps like StockTrim, Streamline, and Easy Insight.

Third-party connectors

Sometimes a company uses another organization, a third party, to provide the application integration software (API) that allows different applications to speak to each other. To enable this, Cin7 can communicate with Syncware, Hyperspace HQ, and Pipe17.

Third-party logistics

Logistics is the physical act of moving items and people from one area of a business to another. If you’re parceling out your warehousing and transportation to another company, you’re using third-party, or 3PL logistics. Some of the companies that provide 3PL include JAS, JD Smith, Quiet Logistics, and Ship Depot. Cin7 lets you integrate your systems with any one of them.

 

Winding up

In summary, application integration refers to the process of connecting two or more applications so that the data each holds can be exchanged. When it comes to IMS systems, this ability to share data makes the entire inventory side of the business operate efficiently, and ensures that there’s enough of it all times in the right quantities.

Cin7’s inventory management software lets you integrate with all the relevant apps, making sure you have all the information you need to keep your inventory at optimum levels.

If you want to learn more about Cin7, book a demo by clicking here.

PO systems for small business: Why your business needs one

If you are like most small businesses and startups, you work as a small team and collaborate with a few trusted suppliers. Even though you may know your suppliers well, you should still establish a system of using purchase orders (PO) for purchasing items. A PO is a formal document that can be referred to in cases of payment disputes or quality problems.

Once you are using POs regularly, the next step is to invest in an order management software that allows you to manage POs and other aspects of fulfillment such as tracking orders and expenses, resupplying stock and updating inventory. Read on to learn more about POs and Cin7’s automated order management system.

 

What is a purchase order (PO)?

A purchase order (PO) is a formal document issued by the buyer and sent to the seller listing all the required goods/services in desired quantities. The seller verifies the PO, delivers the goods to the buyer, and sends an invoice for the completed order. Thus, a PO acts as a legally binding document for buyers and sellers, as both parties can track the ordered items.

Ideally, a PO lists all the required items, their types, quantity, and prices in detail. This is important in case there are problems with the order. For example, if you order 15 printers and the vendor has only sent 14, you will have the PO for validating your order. On the flip side, POs are quite essential for sellers too, as POs will act as proof for the order placed by the buyer. For instance, if a buyer argues about the order quantity, the seller can always hand over the PO to the buyer. It’s a win-win for both parties.

 

What is a PO number?

A PO number is a unique number assigned to every PO. A PO number can help both buyers and sellers track the goods or transactions. In fact, it acts as a quick reference code for businesses to verify orders.

For instance, if a customer has a query and contacts your office, anyone from your accounts department can check their order just by entering the PO number. Businesses often use the PO number to validate the invoice against the purchase order for any mismatch.

 

What is a PO system & how does it work?

A PO system helps businesses create POs effortlessly and digitally.. All you need is to fill up your goods requirements in the desired amount and enter the supplier details. The system generates the PO with a unique PO number and sends it to the supplier instantly.

The PO system streamlines the entire order management process, including purchase requisition, supplier approval, receiving goods, getting invoices, and closing the payment. In short, a PO system is not only about purchase orders but also simplifies all the processes associated with order fulfillment. Furthermore, the PO system maintains the entire business transaction record that both parties can quickly refer to. Thus, businesses can track their orders, view order histories, keep their budget in control, and buy the right amount of stock.

A PO system is essential for any product-based business, regardless of size, as it manages inventory, purchases, orders, and invoices daily. Since the PO system aids transparency and accuracy in managing orders, you will have perfect inventory control, knowing what to stock and what to cut down on.

 

Why should small businesses invest in a PO system like Cin7?

Creating manual POs, maintaining spreadsheets, and following up with suppliers over the phone can be time-consuming and energy-draining. Cin7’s Order Management System offers significant benefits to your business.

1. Save time

Cin7’s OMS saves a lot of your time by simplifying purchasing processes and minimizing manual data entry. You can save the supplier details once and directly send your item list rather than manually entering the supplier details every time. You can readily refer to all the order details and transactions in the PO system. Plus, your employees need not spend time on calculations as the system does it accurately.

2. Gain better control over business processes

Cin7’s order management system is highly transparent, allowing you to view all the business activities in real-time. Hence, as a business owner, you can make data-driven business decisions. For instance, you can compare all the suppliers, their rates, quality, and sales movements. Thus, you can negotiate better deals with the suppliers while delighting your customers with beneficial products that add value to them.

3. Prevent overstocking and understocking of goods

Understocking goods can affect your reputation while overstocking items can dent your profits. With Cin7’s order management system, you can maintain optimal inventory levels at all times. You can automate the system to send POs to suppliers when inventory falls behind certain limits. Can replenishing goods get any easier? Thus, you can ensure you have the right amount of goods at the right places.

 

Summing up

Giving your employees a feature-packed tool like Cin7s order management system will allow them to work more efficiently as the software streamlines the entire backend process of managing orders. Additionally, Cin7 integrates with accounting software like Quickbooks and Xero, and you can import all your business data into it and keep track of your business’s finances. Thus, you can gain real-time insights into your business and intervene earlier to grow your business faster. Talk to Cin7 experts today to learn more about Cin7’s features and functionalities.

A complete guide to ecommerce fulfillment services and their processes

If you are thinking about putting some or all of your sales business online, you probably have many questions about order fulfillment. What’s the best method for your company? How do you make your warehouse or stocking facility perform at maximum efficiency? How do you ensure that orders go out on time? In this article, we will help you answer them.

 

What is ecommerce fulfillment?

Ecommerce fulfillment services cover the entire process of getting an item that’s been ordered online to the customer. Ecommerce fulfillment encompasses everything from receiving the online order to retrieving the goods from their place in the warehouse to boxing and labeling them to shipping and delivering them. Whether your company is business to business (B2B), business to customer (B2C), or direct to customer (D2C), if you’re selling your products online, ecommerce fulfillment is the name of the game.

 

Steps in the ecommerce fulfillment process:

Picking

The first step in fulfilling a customer’s order is to collect the items from their storage locations in the warehouse. This is called picking, and it is carried out by a warehouse operator, or picker. There are two basic ways picking can be done: single order and batch. With the first, orders are taken care of individually, with all items from a given order being picked at once; with the second, a number of one particular item is pulled from its storage location at the same time and then those items are divided into multiple orders. Batch order picking means having to sort items into their individual orders after the initial picking stage. While it requires this second step, if there are a lot of orders to fulfill and many of them have the same item, it’s a cost-saving method. The picking method you choose will depend on the size of your warehouse and the number or orders you have to fulfill.

If you have a large warehouse—and they can be gargantuan nowadays—you also have to make sure that your operators are taking the shortest route as they’re picking. This means listing the items in the right picking order. Thus, if item A is stored close to item B, but item C is way across the facility, it would be logical to list their picking order as A, B, C.

All these considerations are taken care of with a pick list. Created by warehouse managers, a pick list is laid out by item location, name, and quantity needed. Pick lists tell the operator, or picker, first where to go, then what to look for, then how many to pull from storage.

After this, the items are sent to packing.

Packing

Once the items for an order have been collected, they’re placed in a container. It’s important to make sure that the items aren’t damaged during delivery, so packing has to be done with care – and padding.

After the items have been boxed up, a shipping label is created. This label contains:

  • Name and address of the fulfillment company,
  • Name and address of the buyer – where the package is going to,
  • The weight of the package, the entire thing including goods and packing,
  • Unidirectional code, which is a machine-readable code that can be swiped from any direction,
  • A postal barcode,
  • Method of shipping – standard, express, or priority,
  • A routing number, and
  • A tracking number – this is the number customers use to track their package online.

This label is then attached to the package, and the whole thing is weatherproofed with plastic wrap.

Shipping

The package is now ready for shipping. This involves collecting the box and getting it to the buyer’s address. A freight carrier like FedEx or UPS will usually be hired for this, but if the seller is small enough and only has local deliveries, they might take care of it themselves. On the other hand, if a company opts to sell their goods through a major online retailer like Amazon, shipping services are part of the deal: Amazon has its own shipping setup.

Delivery

The final step is to deliver the package to the customer’s door. There, the delivery service may find specific instructions, like being asked to leave the package with a neighbor. Overall, the most important aspect of this last stage is to get the goods delivered on their promised delivery date. Doing this promotes good will – and repeat business.

 

Ecommerce fulfillment models

There are three models you can choose from:

Fulfillment by the seller

When a company is small or doesn’t have many online orders, it can take care of its own fulfillment. If that’s the case, it probably has its own dedicated shipping department, which, depending on the number of online sales it has to organize, might be a small area and not have a dedicated staff. This fulfillment model also works well if the company specializes in unique and valuable items that need extra care.

This system stops working, however, when:

  • The number of orders suddenly shoots up; if this happens, the self-fulfillment system won’t be able to cope and it will collapse.
  • The company doesn’t have a system in place to ensure that all stages of fulfillment run smoothly.
  • The cost of fulfillment is much higher than it would be if using a third-party shipping partner.

2. Fulfillment by a third party

Third-party logistics, or 3PL, stands for an outside company that’s hired to take over all or part of fulfillment.

If a company handles picking and packing in-house and has a large number of packages to deliver to different locations, it’s a good idea to have 3PL take care of those final stages.

Additionally, 3PL companies can provide facilities for warehousing, and they have staff to do the picking and packing tasks as well. The services you choose to use will, of course, determine the fee you pay.

3. Fulfillment by Amazon (FBA)

When it comes to 3PL, the biggest player is undoubtedly Amazon. A complete online marketplace, Amazon is the go-to site for looking to buy something with a click from the comfort of your home, and it is often the first destination for those searching for a particular product. With FBA, Amazon takes care of everything from warehousing to delivery, and it charges two fees: one for storage, and one for the actual fulfillment process.

There are pros and cons to FBA, and the company offers alternatives like Fulfilled by Merchant (FBM) and Seller-fulfilled Prime (SFP). With FBM, the seller lists their products on Amazon’s online marketplace, but takes care of fulfillment itself. SFP is the same, except that Amazon’s shipping policies are used and the Prime badge can be shown against the products on the website. Each of these Amazon services has its own fee structure.

 

How Cin7 can simplify your ecommerce fulfillment

It doesn’t matter which fulfillment model you use, Cin7 inventory management software can be your perfect partner. Its integrated order fulfillment module gives you a clear, overall picture of your entire fulfillment process, including getting goods from your supplier and racking, or warehousing, them. Plus, you can operate your account from a mobile device.

But what if you use a 3PL model for fulfillment services? Well, Cin7 has a solution for you too. The software has 3PL feature that allows you to get real-time information about your inventory anytime, from anywhere, no matter what stage of the operation it’s in. Because it’s cloud based, you can access the system from any device.

 

Wrapping up…

Ecommerce fulfillment service starts when an online order is received by a company, and ends when that ordered item is delivered to the customer. We’ve laid out the steps that are involved in detail and explained the three basic fulfillment methods. While each of these methods is a little different, they all have the same goal: getting your products to your customers in the quickest way possible.

If you’ve been hesitating to set up an ecommerce store because you have concerns about the fulfillment process. keep in mind that Cin7 can provide top-notch services to help oversee and manage your fulfillment, and that it can make the whole process stress-free. Talk to our experts today and book a demo. You’ll be glad you did.

 

Electronic Data Interchange (EDI) what is it and how it can improve the operation of your business

Being able to transmit information from one company to another quickly is an important component of a well-run business. Every day, important files and contracts like purchase orders, invoices, shipping notifications, and catalogs need to be sent. Having Electronic Data Interchange (EDI) software that can interface with different computer networks and digitally get this documentation to someone you’re doing business with is vital.

Stratview Research has predicted that the global EDI software market will grow from USD $1,845.6 million in 2020 to USD $3,244.6 million by 2026, which is a Compound Annual Growth Rate (CAGR) of 9.9%. While most businesses, especially large ones, are already using EDI to send documentation, there may be some smaller companies that haven’t yet made the digital switch. These companies can reap enormous benefits from adopting EDI.

 

What is EDI software?

EDI software allows you to send documentation directly from your computer system to that of another company. EDI puts data from one computer system into a format that allows it to be read by another computer system. Without it, a document a company sends out could not be read by the recipient.

 

What is EDI integration?

When different computer systems can interface because of EDI, they have EDI integration. It’s a seamless, instantaneous way for trading partners to exchange documents like invoices and purchase orders. EDI integration can also be established internally within a company. This means different divisions of a business are able to electronically transfer information between each other and digitally have it at their fingertips. For instance, data kept by the warehouse can be shared with the company’s accounting department.

 

Steps to establish EDI integration

The overall process of producing a business document and getting it to a trading partner electronically is called the workflow. To successfully set up an EDI workflow, you’ll need to do the following:

  1. Make a list of the companies you’ll be exchanging documents with – your trading partners. This will consist of your suppliers, vendors, wholesalers, etc.
  2. Establish what your EDI endpoint will be. Your endpoint for EDI is the segment of your internal computer network system that will be used for the data exchange. This could be your ERP system, accounting software, logistics system, or warehouse management system (WMS).
  3. Decide which business documents you want to send to your trading partner or partners.
  4. Define your EDI standards. EDI standards are a set of globally recognized rules in the digital world for creating documents that have uniformity. It’s a system for producing documents that can be recognized by different computing systems. There are several established EDI standards; ANSI ASC X12 and ODETTE are two of them.
  5. Select an EDI protocol. An EDI protocol is a kind of language that allows computing systems to communicate with each other. In order to exchange documents from one company to another, both have to use the same EDI protocol. There’s a wide range of EDI protocols available, but the four that are most commonly used are: HTTP, OFTP2, AS2, and REST API.

 

How does EDI integration work?

The sheer volume of data businesses produce every day means they have to have a centralized database to store it in. This is an ERP system. EDI software integrates seamlessly with ERP systems.

To transmit data, or documents, using EDI, you have to take the following steps:

  • Prepare the document for the ERP system your company uses.
  • Get the document into an EDI format by using an EDI translator.
  • Convert the EDI document into an agreed-upon EDI standard by using EDI conversion software.
  • Transmit the document through EDI communication protocols like OFTP, AS2 or HTTP.

 

Types of EDI integration

1. Direct EDI integration

Direct EDI Integration or Point-to-Point EDI means that the Internet is being used to facilitate a direct connection between your ERP and your trading partners. Ideal for large-scale organizations that transfer enormous amounts of data on a daily basis, Direct EDI uses a specific protocol.

2. Indirect EDI integration

This involves the exchange of business information between your ERP and your trading partners by using an EDI broker or a Value Added Network (VAN). VAN converts the raw data into EDI data and routes it to the receiver’s endpoint using the EDI communication protocol.

3. Hybrid EDI integration

Hybrid EDI means being able to use both direct and indirect EDI integration. For instance, an organization may use a VAN for indirect EDI transactions when sending some documents, while using direct EDI integration for others.

4. EDI integration as a service

This means using a third-party EDI service provider. There are several reasons why companies would outsource their EDI like this. They may not have the resources to have the software inhouse themselves, or they may choose to focus their time and energy on taking care of the day-to-day operations of their businesses.

 

EDI for small businesses

Fortune Business Insights predicts that globally EDI software will grow to USD $4.04 billion by 2029, which is a CAGR of 11.6%. The main reason for this is that EDI has become more affordable, which means that instead of only being used by large organizations, small and midsize companies are now able to buy it.

Today there’s sophisticated software like Cin7, which has robust EDI capabilities, a large EDI network, and tools that let you manage your EDI customers in one automated system. Cin7 eliminates the need for any third-party EDI software provider.

Cin7’s software is a fast, efficient, full-fledged EDI tool that offers the following:

Workflow automation

  • Automation for any of your business processes,
  • A streamlined integration between many trading partners, and
  • A better EDI operation in general.

Full service

  • Support from Cin7 all the time,
  • Design and configuration services,
  • Compliance testing that meets the standards you expect, and
  • 24/7 monitoring that looks for errors in your system and resolves any issues you may have.

Data transparency

  • The status of your orders can be checked anytime.
  • There won’t be a need to spend money on third-party EDI providers.
  • Your data can be accessed in real time, and all your orders will be fulfilled accurately.
  • All your data transfers will be standardized.

Support for multiple fulfillment models

  • Seamless coordination with your product distributors, 3PL providers, and commerce channels,
  • An intuitive EDI dashboard that makes EDI easy to use, and
  • Multiple options for cartonization, which means being able to fulfill numerous orders instantly.

Pre-built EDI mapping

  • Ability to track the workflow of orders you have with several of the companies you trade with, and
  • EDI software that’s compatible with American National Standards (X12) and European Standards (EDIFACT), so you can trade globally easily.

 

How Cin7 can help you with EDI integration

Cin7’s EDI software can interface with major retailers worldwide. As a cloud-based inventory management system, it takes care of your orders and oversees them from initiation to fulfillment while securely transferring your business documents electronically. You won’t need to employ a third-party vendor for these transactions. Cin7’s software takes care of everything.

When orders are fulfilled quickly and accurately, as they are when you use Cin7’s EDI, customers are happy and more likely to become repeat buyers. Since most established firms prefer EDI for B2B transactions, if you invest in the software, you’ll attract clients who, in turn, can expose you to more business opportunities.

Moreover, automating your business processes frees up your employees to work on other, critical areas of your business. These could include client relationships and expanding your inventory, areas that can significantly grow your business.

So, what are you waiting for? Reach out to our Cin7 team for a demo and learn how Cin7 can help you with EDI solutions.

Big Music

When Richard Berkman started Big Music with his brother David back in 2009, they did it because they wanted to do something that they were passionate about, instead of a job that just paid the bills. 

“My brother was a passionate musician, and we had this idea to create a one-stop-shop where you could buy an instrument, learn to play it, perform, even record, all under the one roof,”  Richard says. 

He and his brother looked everywhere for businesses following a similar approach, but couldn’t find many overseas, and there were none at all in Australia. 

“We asked why, and the music stores said, ‘We know nothing about running a lessons business,’ and the music schools said ‘We know nothing about running a retail store.’ But we were stupid enough to try to do both at once,” Richard chuckles. “For our sins, we broke all the rules.” 

If they’d have known better, they might have never started. But 12 years and “a hell of a lot of mistakes,” later Big Music is still here, and the business keeps the brothers busy. They have over 800 students come in for music lessons in the Big Music studios, they have 30 music teachers working six or seven days a week, teaching children and adults, and they’ve got a music product business that sells both online and in their Sydney street-front retail premises. 

Prior to 2020, the business had matured and was running well — and everyone knows what happened next. 

Covid pause causes pandemonium 

The Covid-19 pandemic laid waste to many retail businesses. Lockdowns hit first, then when rules relaxed, the ongoing pandemic saw people understandably reluctant to return to packed stores. But, for many product companies, the slump in foot traffic was more than made up for by a surge in eCommerce. Companies that were in a place to take advantage of the conditions often did more thriving than mere surviving. 

“Prior to Covid, our eCommerce business was around 25 percent of total sales,” Richard says. “And now… it’s hard to tell because it’s still settling down, but I think it’ll end up being more like 35 to 40 percent.” 

The music business has some unique caveats that makes online selling potentially problematic. It’s not like, for example, a shoe shop, where products tend to be similarly priced. Music products have a huge price range — something as simple as a guitar pick can be picked up for less than $2, whereas a custom Fender Stratocaster guitar can sell for more than $10,000. Some purchases are impulse buys, where others are much more considered, like buying a car. 

“So our sales people are sometimes like a checkout person at a grocery store, and other times they’re like a car salesperson,” Richard says. 

“We needed to find systems that could handle both — allow us to have a certain volume of very small transactions, where there’s not a big customer relationship component, and then maybe half a dozen times a day there’s going to a much more considered transaction where we could be giving people quotes, they’re going away and thinking about it, and then when they purchase you’re adding on all this other stuff and bundling it.” 

Big Music had long used an inventory management system called Lightspeed to handle Big Music’s unique requirements. Over the years, they’d customized it to fit the business, and their staff were all used to it. But with the increase in their eCommerce sales volume, and the modernization and cloud trend in the business software landscape, they found themselves outgrowing Lightspeed. 

When Lightspeed announced it was winding down, Big Music needed something bigger and better, and to implement it, they turned to the people who’d helped them get Lightspeed up and running over a decade ago — SMB Consultants. 

Time for a tune-up

Richard had known Jeff and Peter at SMB before Big Music even existed, so he knew they were the sort of people who’d be able to help them implement an inventory system that was just right for Big Music. He’d taken note of business software trends, where systems are built to do one thing well — like Xero for accounting — but also have open APIs and software endpoints that allow different apps to share data and talk with each other. 

“You now have this modular approach, where you take the best apps and put them together to give you a customized solution,” Richard says. “And Jeff and his team had worked that out a long time before a lot of other people did. They’ve now helped hundreds of businesses navigate down that particular pathway, and that’s a profound change from 10 or 12 years ago where you chose one system that would do everything.” 

A decade ago, Big Music had settled for just such an approach. They ran the business on Lightspeed and MYOB, both of which were run out of a server on-premises. “It was costing us a lot of money to maintain a server room, have network consultants come out and maintain the servers, do backups, and that sort of stuff. And it didn’t make sense given the whole world’s been moving to the cloud, and I figured we could save some money if we did too,” Richard says. 

However, the process of changing business-critical software can be fraught. Without the right solution and a well-planned implementation, there can be significant adverse business impacts. SMB Consultants knows this very well, which is why they have a careful, staged approach to recommending software, and implementing it. 

“With any Lightspeed client, the software is so heavily ingrained in the business. It’s like their operating system, and that means change management really comes into it, because the staff will be used to the Lightspeed way of doing things,” says Jeff Atizado, co-founder of SMB Consultants. “As a business owner myself, there’s got to be careful consideration going through the process, understanding the workflows, understanding the options, and making informed decisions as you go.” 

Richard agrees. “They’re big projects, and an awful lot can go wrong. That’s why working with a mob like SMB was so critical — as soon as they were engaged, my confidence level that we could do a good job improved dramatically.” 

With the right experts brought on board to help, Big Music was ready for a new approach — choosing a cloud-powered app stack to act as a fully-bespoke ERP, with a single app at its core, acting as a sole source of truth. For this, they chose Cin7. 

Singing from the same song sheet

When Big Music made the move to Cin7, they also opted to switch from desktop-based MYOB to online accounting with Xero. They wanted their move to the cloud to be complete, with all the benefits that being cloud-based entails. Inventory data was cleaned up and carefully moved from Lightspeed into Cin7, and the same process took place from MYOB to Xero. This meant that vital historical data was kept intact, and helped maintain business continuity across the transition. 

With the implementation is complete across all of Big Music’s different software packages, the difference is night and day. 

“The integration between Cin7 and Xero has been a significant enabler of a whole bunch of improvements,” Richard says. “The first is that our server room has been decommissioned, and I don’t have to spend as much money or worry about supporting that infrastructure. That’s been a blessing in itself. Not only that, but Lightspeed was holding us back, because it won’t run on certain operating systems.” 

Now that the business is running on modern cloud technology, Big Music is able to be completely up-to-date with operating systems and security patches. “Our whole environment is safer and more secure than before,” Richard says. “Uptime has been over 99 percent.” 

Big Music are using Cin7’s built-in Point Of Sale capability for all their in-store transactions, and it’s been working seamlessly. The near instant sync with inventory means they always know exactly how much product they have to hand, so customers aren’t kept waiting. 

“The POS system works fine!” Richard says. “When you’re putting through dozens and dozens of little transactions each day, the POS system handles that beautifully. And the guys in the shop reckon it’s actually easier to use.” 

Because of the high disparity in musical product pricing, Richard’s staff have to be jacks-of-all-trades, working the retail floor one moment, then negotiating a high-value purchase. Big Music is an all-in-one location, with the retail storefront, and a warehouse up back, plus studios and other areas for learning and recording. Both retail and online orders are fulfilled from the same warehouse. The website is built on Shopify, and the team uses Starshipit for fulfillment. 

“Our guys jump between the POS system and the backend,” Richard says. “When you’re selling a $10,000 guitar you’ve got to get into discussions about discounts and margins and all of that information is in Cin7, but it hasn’t been an issue for my team to navigate between that and the POS.” 

Richard also cites the cloud capability of Cin7 as having extended his access to the business — even when staff are offsite. “Cin7 was particularly handy during COVID,” he says. “Without it, we’d have been stuffed. Our operations and warehouse manager wasn’t able to physically come into work, but he could log on from home every day and do his job in Cin7, from home.” 

With Cin7 in the cloud, the back-office can be anywhere 

The new system has also created a better work-life balance for back-office staff. “Cin7 enables a more flexible approach to our workforce,” Richard says. “Our bookkeeper Diane moved cities a few months ago, and she didn’t have to resign or anything, because she can access Cin7 and Xero from Brisbane, just as well as she can operate from here. That’s the future, isn’t it? That wouldn’t have been possible in the old Lightspeed and MYOB world.”  

As the business owner, Richard says the system has allowed more oversight while reducing the amount of time he needs to spend poring over reports.  “I love the fact I can login from home on a Saturday or Sunday evening, and see how the store’s been trading during the day,” he says. “Having the real-time information available from anywhere is great for me.” 

For Big Music’s bookkeeper (working from another city!) the level of data available has been a revelation. The depth of the integration has also removed a lot of manual effort, with operations staff all getting more data and working more efficiently than before. 

 “Cin7’s integration with Xero means that our bookkeeper can get a lot more information, down to the product level, when doing things like supplier reconciliations,” Richard says. “That information never existed in MYOB, so that makes her job a hell of a lot easier. I also love the pivot table functionality in Cin7 reporting, and I use that quite a lot when I’m doing analysis. It’s a lot nicer to be able to do it natively in Cin7, rather than exporting and doing it in Excel.” 

Stock-taking and inventory reconciliation is a song with Cin7

Stock-taking — the perennial bugbear of any retailer — has been made much, much easier thanks to Cin7. “It used to drive me insane because the Lightspeed stock-take module was buggy, and not transparent. By contrast, going through the stock-take process in Cin7 is much easier to manage, because you can break it down into components, and execute a section or a brand or a range of things at a time.” 

The difference between then and now, when it comes to stock-take, is night and day. In fact, it’s an entire weekend’s worth of days. The Big Music team used to have to do a store-wide stock take once a year, but now they can do a rolling inventory reconciliation that doesn’t require shutting down for a day or more, or coming in on a weekend. “We had to do a massive store-wide stock-take once a year, which everyone hated,” Richard says. “We don’t have to do that anymore.” 

Furthermore, Cin7 has made the process of taking sales orders and converting them to purchase orders much easier. A lot of Big Music’s online orders are for items they don’t actually stock in their own warehouse. Cin7 has enabled drop-shipping, even for very complex or expensive orders. “We can knock the purchase order conversion very quickly and seamlessly,” Richard says. 

Everything working together in harmony

For businesses considering adopting a cloud inventory management solution, Richard is happy to recommend Cin7 — but he’s adamant that the process is much easier all around when you’ve got expert help. 

“I’ll go so far to say, well, I cannot imagine having got through this project any other way and without the help of these two blokes and the rest of their team,” Richard says. “Don’t try and do it yourself.  I think that SMB have got a unique set of skills and a deep understanding, and we needed it.” 

Now that Cin7 serves as Big Music’s source of truth and center of operations, things have never been better. “It works. It’s a good, reliable platform. It connects well with other apps, and you’re future-proofing your business by taking this kind of modular ecosystem approach,” Richard says.