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Are your restaurant clients asking for EDI? Why does it seem so confusing?
by Jeb Buie (Wednesday, January 16, 2008
4:34 pm) |
Are you wondering why your suppliers or clients
want you to invest in EDI? Does it seem like EDI is a hardly justifiable expense
for the small to medium size food service distributor?
From your point of view, EDI might
appear to be a luxury tool to have. For your clients - food service operator partners
– EDI (an acronym stands for Electronic Data Interchange) is a way for your clients
to communicate with your company easily, efficiently and effectively. What this
means to you is that every operator approaches this agenda from a different angle;
often equating to the distributor the ‘necessary evil’ of paying for not just one,
but many EDI formats to cover gamete of their clientele.
Typically in our industry, you will only use three different formats. To illustrate;
when a restaurant places an order, a purchase order (ORD or 850) is sent to the
distributor. Once processed and shipment is in route, an advanced shipment notification
(ASN or 856) is sent to back to the restaurant. After the invoice has finalized,
an invoice (INV or 810) is sent to the restaurant for payment. If the restaurant
is fully utilizing EDI, the last step will be the (RMT or 820) which is the digital
payment remittance.
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The upside for the distributor to embrace EDI is threefold. The first being an order
processing; electronic processing is considerably more effective and efficient,
removing the lion share of human error. The second being faster payment; since the
invoice is finalized digitally quickly after delivery, clients pay faster increasing
cash flow. The third and most important is keeping up with the competition. Most
of your competition is utilizing EDI in some form or fashion, so not offering that
capability seriously undermines your appearance of offering a comprehensive service.
In some instances, distributors even set themselves apart by their ability to utilize
new technologies such as EDI – well before others in the industry. You can bet that
it is worth the hassle.
EDI and the aggressive move towards digitization is here to stay, so continue to
educate
and inform yourself on the impacts to your business. You can reference
OneSource
, and the Intelogix platform, that will handle many aspects of your business
intelligence needs- not to mention EDI. |
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