The six essential questions to ask your EDI supplier

HELPING COMPANIES MOVE TO THE NEXT LEVEL:

Transalis Co-founder and Joint Managing Director, Aniello Sabatino, gives his advice

It’s a child of the Sixties that now supports a mature market of versions and providers.

And if you are thinking of equipping your business with electronic data interchange, or EDI, you’ll want to be absolutely sure your choice is right for you.

According to the standards organisation GS1 UK, there are many compelling reasons to switch to EDI whether you are a retailer, manufacturer or supply chain partner.

Take cost savings. UK grocers together save more than £650 million a year thanks to EDI. Businesses, in general, save £14 an order and £8.50 per invoice.

Or faster processing. E-invoicing cuts ten minutes of time per invoice, creating an annual saving for UK retailers of around £100 million.

Public sector organisations report a wealth of efficiencies too. The Danish government, for example, saves the equivalent of 2,000 man-hours per year.

Even if there were no cost or time savings, it would still be sensible to move to EDI to help save the planet. It eliminates paper-based manual processes that are increasingly seen as unsustainable.

And linked to all of the above is the issue of accuracy. GS1 UK has found that on average, up to 5% of the data on a typical paper invoice is inaccurate. Going digital can eliminate such a costly error rate.

Quiz your supplier

So, if you are thinking of ditching paper-based processes in favour of greater agility, what do you need to know about EDI? What should you be asking your prospective EDI supplier?

Based on 20 years experience of working with customers at supply chain connector Transalis, here is a list of the top six, most frequently asked questions compiled by directors Aniello Sabatino and Marc Stares:

How do I know a solution will be right for me?

Each of your trading relationships is likely to involve a different way of working regarding documentation. This means data has to be translated into multiple formats before it can be shared, eating up precious time and resources. You don’t want to have to do all the essential formatting and translation to solve this. Ask for reassurance from your provider that they’ve already sorted this headache for you. You also want to know that whatever functionality they are offering is completely scalable for your particular business and is easy to implement and operate.

How much will it cost?

You want to find a transparently priced solution that is tailored to your needs and that can generate a return on investment. Ask your provider about the pricing model and the support they offer. Be sure that the price reflects exactly the level of help you need and comes with no hidden extras or upfront fees.

What benefits can I expect to see?

EDI is designed to take out the cost, time and hassle of exchanging business documents with your trading network. It does this by connecting everyone involved with a trading platform hosted by the EDI provider. All kinds of business documents, including structured and unstructured data, can be exchanged without you or your trading network having to learn the technical ins and outs. Standardisation across a digital supply chain ensures all trading partners benefit from easily understood digitised information. In a nutshell, EDI minimises error, maximises efficiency, reduces delivery time and speeds invoice payment. Without EDI you have the task of raising orders and invoices manually, sending documents by post or email, and inputting the related information manually into management systems. With EDI, you avoid all that thanks to the automatic raising of orders and invoices, and digital sending and receipt. EDI improves so many processes from inventory management to shipping to audit. As well as orders and invoices, it automates the use of shipping notes, quotes, despatch and returns instructions, tax summaries, debit and credit notes, remittance advice and many other kinds of documentation and master data.

Can I make adjustments if required?

The answer should be ‘Of course’. A good EDI provider is with you every step of the way and able to refine the solution as required. You can agree on how outputs are scheduled, how different documents are mapped from source files and integrated, and how testing can ensure data is validated before it is shared. Remember, because EDI is a mature market, companies have got used to certain ways of doing things so there may be legacy systems in place. This is fine as far as it goes but in a disruptive and ever more challenging trading environment, staying still can leave you at a competitive disadvantage as rivals innovate in their EDI capabilities. So don’t be afraid to question your IT consultant about legacy systems. If the best solution from now on involves unpicking embedded, long-standing processes and re-engineering from the top down or bottom up, then so be it. And going forward, keep everything under constant review.

What experience can I expect my EDI provider to have already?

Lots. Ask them. Do they already service a host of companies and organisations? Have they got a track record in delivering ROI? At Transalis for example, we service a global community of more than 10,000 clients in sectors such as retail, manufacturing, distribution, logistics, health and beauty, and FMCG. From the smallest of suppliers to the largest of retailers, thousands of Transalis customers in the UK and globally are deriving benefit from the end-to-end supply chain solutions we enable.

How quickly can I be up and running with EDI?

Whatever industry sector you work in, you will typically have much responsibility resting on your shoulders. There will be many systems and processes to manage, and a wealth of information to monitor and process. We know you won’t want to be weighed down with a further blizzard of technical considerations about EDI. You want us to take that strain on your behalf so you can concentrate on running the business and going for growth. Our approach is based on gaining your trust so we establish a strong, lasting relationship that brings you real value and benefits. With Transalis, you can have a free, no-obligation process review. If you’re happy with our feedback and suggestions, you could be trading electronically within days.

Isn’t it about time you turned to EDI, a technology that has become synonymous with process efficiency since the Sixties?