Managed Services, EDI

Many companies that electronically trade with business partners are often confronted with many challenges. If your company hasn’t yet encountered any of the following, it likely will at some point: 

  • The number of business partners that want to trade via EDI is growing. 
  • IT has no time to support EDI projects because there are too many higher priority projects. 
  • IT has been reorganized and EDI is no longer a core competency. 
  • The EDI coordinator has been promoted, retired, or left the company. 
  • The company’s business partners provide a scorecard with low scores. 
  • Business partners are changing business rules or asking to add new transactions types. shutterstock_560305249_support

The inability to fix these issues could have undesirable and damaging consequences, such as: 

  • Restricted sales growth or procurement efficiency because the company can’t deliver a working trading solution with customers or suppliers 
  • Lower performance for sales or procurement departments 
  • The relationship between the business and IT is primarily based on resolving escalations arising from existing trading relationships   
  • Existing trading partners issue fines or chargebacks due to non-compliant electronic trading 

At the core of these challenges is the lack of skilled resources to plan, build, and run solutions. Skilled resources that could convert business needs to actionable options for the business to decide upon, and eventually implementUnfortunately, these skilled resources are becoming scarce for many companies due to resource constraints. 

Many IT leaders have turned to external partners to help.  Some partners are providing managed services at competitive rates to support the business activities.  In this manner the company gains a resource focused on the company’s business initiatives and handles the day to day tasks that are too taxing for IT or businesses to manage on their own.  

For companies that do business with EDI, managed services can create a competitive advantage. The virtual staff member can coordinate with expert partner consultants to systematically onboard new trading partners, while keeping the existing trading relationships running optimally. This includes problem solving, responding quickly to trading partner queries, and collaborating with the ERP teams on supply chain improvements based on industry best practices. 

Data Masons provides managed services to customers around the world. Our customers get staff focused on the details of EDI trading relationships and are always available to help. To learn more about our EDI managed services option, watch our short webinar.

Watch the Managed Services Webinar

Managed Services, EDI, ERP

Employee retirements can generate questions and challenges for you as a manager, especially when that employee manages critical business processes that require specific expertise. 

Since EDI is not a core competency of most businesses, most of the required knowledge resides with very few people. With the departure of a key resource, it may be a good time to reflect on what to do next.   

One of the principles of digital transformation is outsourcing activities that are not core to the business. Whether a fulltime employee can be replaced by a service option at a lower cost, from subject matter experts to bootthat should be a strong consideration.  

Reflect and Ask the Right Questions 

“What do we want this role to do in the future?” “Does this role advance our business objectives?” “Can we allocate this salary to a resource to better advance our business objectives?” “Can a single person cover all of the hours of in which we operate?” Do we know what the true potential of our system is for our business? Support_1920x700

Hiring, onboarding and training new employees is expensive. There is a cost to managing people and a tight labor market means that salary costs may increase for the same output.  In fact, replacing a position doesn’t guarantee a better outcome, and companies may pay more for a lesser result. Since EDI activities can directly impact business execution and profits, knowledgeable resources employing best practices relating to EDI can advance your business. For example, fewer errors and faster turnaround on issues can boost customer satisfaction, supplier scorecards, and profits. 

 

Managed EDI Services made EDI simple for Stack-On Products. Watch the video to learn more.

 

Advantages of EDI Managed Services 

Managed EDI Services from Data Masons provides a dedicated resource that handles your EDI operations as though they are a member of your organization.  This dedicated resource is part of a small team that manage a limited number of accounts. In this way, no organization is without a trained, knowledgeable resource during vacations and other “time off” events.  Managed services also cover multiple time zones to manage EDI activities that a single person cannot handle.   

Ongoing training received by managed services personnel benefits your company, and allows new features to be put into production more rapidly. Their primary focus, that your EDI operations run smoothly, frees your team to advance your business.  

Day-to-day operational tasks handled by EDI Managed Services teams include proactive monitoring of your EDI environment, making sure all EDI alerts are resolved, addressing their root causes, communicating with your trading partners on all EDI related matters, handling the mundane day-to-day activities, communicating with your business stakeholders, and recommending improvements. 

Managed Services can be implemented very quickly when needed – in some cases – hours. The timeframe is significantly less time than to ramp up a new employee  

With all of these benefits of EDI Managed Services, an employee retirement could be an opportunity to simplify and improve how you operate. To learn more, check out this video about Stack-On, a company that benefited from EDI Managed Services. 

Watch the Testimonial Video

EDI

Great news! You just landed that major account!  The bad news? You must now be EDI compliant.

EDI is all about saving money through increased labor efficiency and elimination of data entry related errors in the business process between business partners. Done the right way, EDI can be extremely beneficial for all parties. Studies have shown a successfully automated EDI program can reduce costs by $75 to $125 per Purchase Order processed. Your partner knows this, and that’s why they won’t do business otherwise.  download

Not all EDI options are created equal, and it doesn’t always increase efficiency for all parties. Your partner says they have a vendor portal you can use, or you can contact a 3rd party company to setup a webform option. Very simple and seemingly inexpensive. In very low transaction volume relationships, this method can be a good fit. 

Vendor Portals: Is Free Really Free?

Vendor portal options are usually the “free” option. It’s a website provided by your partner where your company can print reports and enter data manually. The typical process is that someone logs in, prints the order details, and then keys the PO details into your ERP system. You are then expected to enter a detailed confirmation into the web portal. When the product ships, the details of the shipment have to be entered into the portal so the partner knows what is coming, and how it is packed by carton and by pallet. Special labels then need to be printed for each carton and pallet related to the shipment. Because the labels are very specific, your warehouse team must apply the labels to the correct boxes and pallets. 

Next, the invoice details have to be registered. Finally, payment information will need to be printed and applied in your system. For something that is “low cost,” the labor costs can actually be astronomical. If a data entry mistake is made, there are typically fines that can cut your profit margins! These costs are rarely measured by most firms, but can definitely add up.

EDI webform portal options solve the problem of multiple websites (portals) for various partners by enabling one single data entry portal for all partners. An EDI webform portal requires less training than multiple vendor portals, but there is a cost for the portal and each transaction entered into it. However, the costs of data entry labor and data entry errors still remain.    

Don't let integrated EDI scare you. Learn how simple it can be with our white paper, 3 Keys to Integration Without Customizations.

Integrated EDI Can Alleviate Your Concerns

Another option for handling EDI is an integrated approach advocated by Data Masons that truly drives down the cost of doing business and frees resources to help grow your business instead. The objective of the platform is to eliminate data entry processes using a “lights out” automated model. Business users are alerted when issues arise with plain language messages that enable a “management by exception” experience. The ROI of an investment in the platform can be huge as documents can be integrated and processed for pennies, and in some cases less than a penny. Most importantly, your business operates more quickly and accurately with an automated and integrated approach. A strong provider can connect your ERP to many external touchpoints and internal systems such as a WMS or shopping cart solution.   

Take care when evaluating your options for an EDI process - both today and in the future. Consider factors such as your anticipated growth in transaction volumes over the next 2-3 years, the amount of time your team spends entering data, what all of this effort is truly costing your firm in terms of missed opportunities and overhead, what your transaction count per month might be, and the cost of manual data entry and mistakes. For example, drop ship programs can create efficiencies for you and your customers but also create new burdens. EDI automation removes those burdens – increased business without increased headaches.

EDI integration is easier than you might think. Our white paper explains how. 

Download the "Integration Without Customization:  3 Keys to Automated Integration" Brief    

Advanced Ship Notice (ASN), Vendor EDI, Supply Chain EDI, EDI, ERP

In many businesses, EDI processing is like the circulatory system in the human body, and the ERP system is the heart of the business. In other words, EDI is important! Many industries have leveraged EDI’s impact on efficiency to scale operations in a manner and cost structure that would be impossible without it.  The ability to automate repetitive office tasks to integrated EDI is transformational.   

Many enterprises rank their suppliers using a scorecard model that rewards better performing suppliers and punishes those that are difficult to do business with. Unsurprisingly, EDI is a significant factor on supplier scorecards, since mistakes and delays can hamper the ability to execute business.shutterstock_204413116_scorecards

A good example of how a supplier can undermine a customer is Advanced Ship Notices (ASN). ASN’s tell the recipient what they will be receiving, and often in significant detail, so that the receiving of the goods can be handled through a simple scanning process. Distribution centers often operate at high rates of speed, and ASN-related mistakes can cause costly operating inefficiencies and overtime. Imagine a truck arrives with one supplier’s goods. When a proper and timely ASN is received, the work of the warehouse team is quite simple – scan and put away or crossdock the goods to the final destination(s)

Now imagine a second supplier’s truck arrives, but the ASN has not been received by the warehouse. The scans will not work as there is no information to receive the goods and they have to be moved to another location or rejected and sent back to the supplier. This is an ugly situation that costs money, renders valuable shelf space empty, and results in lost sales. 

Additionally, the supplier with the late ASN will be penalized on their scorecard, which in turn opens the door to competitors and reduces the supplier’s sales. 

If you're looking for an EDI vendor, review our checklist to help you select the right solution for your business needs.

There are a lot of other factors by which vendor performance can be quantified over time, and they are driven by rules outlined in vendor agreements. These rules are for the benefit of both parties so that the business activities mesh more smoothly. Rules communicate expectations, e.g: Orders are to be acknowledged within 4 hours, a ship notice should arrive before the shipment, shipment notices must be sent when the truck leaves the facility, and invoices should arrive within 24 hours of the shipment.   

Such specific rules enable a good application to identify when these rules are not being met and generate escalations to the responsible parties at the supplier so that corrective action can be taken before the scorecard is impacted.   

For companies that want to implement a scorecard system of their own, the first step is to set the rules and benchmarks for excellence in the supplier base. The rules can govern everything from timeliness and accuracy, to product quality. 

For example, an organization that requires vendors to perform drop ship activities could look at the time to ship by analyzing the days between sending a PO and receiving the ASN and Proof of Delivery. Analyzing such information helps to determine which vendors are conforming to estimated ship times provided to customers – an important KPI that reflects the consumer’s experience. 

After investing the time and effort into implementing a fully integrated EDI system, gaining this extra insight into the performance of your vendors will be beneficial. A vendor scorecard program makes it possible to proactively manage trends early on and help identify which suppliers are delivering the best value versus least cost.   

Looking for an EDI vendor? We can help. Download our checklist to make this task simpler, and find the right vendor for your needs.

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EDI, ERP

Rube Goldberg machines are pretty coolIf you’re not careful, you could spend hours watching videos of machines which perform simple tasks in no less than twenty steps. Like this gif, where a series of household objects take nearly a minute to turn on a record player. Of course, when it comes to important tasks such as business processes, it’s important to remember Rube Goldberg machines are the fancies of a cartoonist who created them as jokes. 

We’ve worked with companies who inadvertently created a “Rube Goldberg” solution to EDI integration. Most often the solutions are multi-step, multiple application solutions that create multiple points of failure, as is the case with most Rube Goldberg devices. A little research can help avoid those situations, and utilizing a proven solution rather than trying to build one can accelerate business improvement and digital transformation.  

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Look for these attributes to find an EDI solution that does not follow a Rube Goldberg approach… 

  1. It’s a single platform – not a cobbled together group of technologies from various vendors. 
  2. It doesn’t have to be created – its ready to work out of the box. 
  3. It doesn’t require customizations in other applications to work properly. 
  4. It stops bad data from being created that can create downstream problems for stakeholders and customers. 
  5. Top notch service is available when needed to manage issues. 
  6. It can do more than just EDI – it can handle many types of integration that enables a single platform approach for organizations. 

Make sure you get these attributes-- and avoid common pitfalls-- by reading Top 10 Mistakes to Avoid When Selecting an EDI Solution

Some Rube Goldberg machines work, albeit slowly and with a lot of effort. When it comes to mission critical business processes such as EDI and B2B Commerce, simple and reliable is the best way to move organizations forward. 

Data Masons has been delivering EDI Made Simple for 15 years by providing a unique, solution-oriented platform coupled with expert services. Data Masons improves company’s ability to execute business processes more quickly, accurate and at a lower cost – a key objective of Digital Transformation.   

Please enjoy some of the machines other people have made, and if you’re getting dizzy from watching them, make sure you avoid the pitfalls of Rube Goldberg EDI by reading our white paper, Top 10 Mistakes to Avoid When Selecting an EDI Solution. 

Get the "Top 10 Mistakes When   Selecting an EDI Solution" Brief

Exact Software Integration, Dynamics ERP Integration, EDI, ERP

There are compelling reasons why worldwide EDI transaction volume continues to grow. EDI can lower costs, improve accuracy, increase efficiency, improve fulfillment times, etc. However, it is virtually impossible to recognize any of these benefits if EDI transactions are not integrated with an Enterprise Resource Planning (ERP) system. If a company is receiving 1000’s of orders per day electronically, but must key them into their fulfilment system manually, it is unlikely there will be a material benefit to sending and receiving transactions via EDI.

While EDI integration to an ERP is critical, surprisingly, most leading ERP packages do not provide “out of the box” support for EDI. EDI support or integration is typically provided by third parties, or ISV solutions. These third-party solutions have features that make them unique but fundamentally they come in only one of two flavors: embedded or stand-alone. An embedded solution is one in which the ISV has modified the source code, screens, business logic, and database objects of the ERP application to support EDI. A non- embedded or stand-alone solution is one that does not require modifications to the source code or the database objects of the ERP application. The concept is simple, and the differences may seem obvious, however, the ramifications of choosing one approach vs. the other can be significant.

 

Stand-Alone is Less Strain on Your ERP

The Data Masons EDI solution is a stand-alone application. All transaction processing, cross reference checking, mapping, error handling, exception reporting, etc. is managed outside of the ERP. The Data Masons application communicates directly with the ERP application in real time via the ERP’s native integration layer protocols (oData, Data Endpoints, Integration Ports, etc.). This is the ERP companies’ recommended approach, because it removes the resource intensive processing of transactions from the ERP. It also allows the EDI solution to remain decoupled from ERP. This insulates the stand-alone EDI application from any disruptive changes to ERP introduced by customizations or upgrades and conversely protects the ERP application by not requiring code changes or customizations to support EDI integration.shutterstock_84146302_headachecomputer

There is a vast amount of processing and business logic involved in integrating EDI transactions into an ERP system. In addition to reporting, notifications, exception handling, and transaction processing, it is akin to essentially connecting the ERP system of one company to another. Item numbers, ship to locations, customer codes, discount codes, freight providers, etc. all need to be translated or mapped from one system to another. EDI standards facilitate this integration to an extent, but EDI has grown far beyond the traditional ANSI X12 or EDIFACT standards. EDI encompasses ecommerce: cXML, XML, Flat File, X12, EDIFACT, Punch Outs, API’s via https, Amazon Web Services, Blockchain, Web Shopping Carts, etc. Embedding all the functionality required to support ecommerce into to an existing ERP system radically alters the underlying system. It requires significant invasive code changes and customizations to the ERP code base, business logic, and database objects.

Don't get caught in an integration nightmare. Download our paper, 3 Keys to Integration Without Customization, to learn more about avoiding ERP customizations.

Could Embedded EDI Still be Worth It?

ERP customizations are not uncommon, however. Anyone who has implemented an ERP system has experienced the dilemma between altering the ERP to fit a business process vs altering the business process to fit the ERP. In the short term it is tempting to modify the ERP application, especially if it is something minor such as adding a new field or simply changing a label.

However, long term, even simple changes to ERP source code can have long lasting and painful consequences. For this reason, conventional wisdom and ERP vendors caution against significant customizations to ERP. Each change to ERP source code adds to the complexity and cost of supporting and maintaining the system. Customized ERP systems can be a nightmare to upgrade because all customizations must be re-introduced or migrated into the new code base and then all changes must be tested again. This reengineering and regression testing process is at the very least expensive and time consuming and at its worst can be cost prohibitive. It is not uncommon for customers with heavily customized ERP systems to remain on outdated versions indefinitely. This inability to upgrade is a problem for not only the customer but also the ERP vendor.

Embedded EDI is a problem for the customer in that they are not able to take advantage of critical fixes or enhancements that are introduced by the ERP vendor. They are in effect receiving zero return for the support and maintenance fees they are paying for their system if they are not upgrading regularly. It is a problem for the ERP vendor in that they must continue to support outdated systems and technology. They are required to spread their resources across multiple supported versions.

 

Listen to Your ERP Provider

Not surprisingly ERP vendors have taken steps recently to mitigate this problem, particularly within the SaaS ERP solutions. Customers are being strongly discouraged from making any changes to core code, but more importantly customers will no longer be able to remain on a version indefinitely. Microsoft, for example, has implemented a policy of "One version, with all customers on the latest available version". With this policy effective as of January 31, 2019, all users were required to update to a specific version. Going forward there will be twice per year (April and October) mandatory upgrades for all customers using the Microsoft flagship D365 suite of ERP.

Microsoft will disable potentially disruptive new features by default and intends to make the releases backwards compatible to minimize impact to customizations. However, the impact to customers with an embedded EDI solution or a heavily customized ERP will most likely be extensive twice annual regression testing, followed by more code changes and updates to take advantage of new functionality. This will most likely make an embedded EDI solution very difficult and expensive to maintain and why Data Masons promotes the stand-alone approach.

To learn more about how our stand-alone EDI approach can save you time, money, and headaches, read our white paper on EDI and ERP integration without customizations.

Download the "Integration Without Customization:  3 Keys to Automated Integration" Brief

Growers and Nurseries, Blockchain, EDI

Many Wal-Mart fresh produce suppliers are concerned with how their company is going to handle the new Wal-Mart Produce Traceability Initiative (PTI) requirements. PTI is required by Wal-Mart for leafy greens by September 30th, 2019 and it is expected that other fresh produce suppliers will also be impacted in future roll-outs.

Wal-Mart’s goal is to trace their produce through the vertical chains in which they conduct business by leveraging IBM’s blockchain-enabled technology branded as the “IBM Food Trust Network” to achieve their objective. The IBM Food Trust Network requires data often found on the traditional advance ship notice (856) document plus additional “lot” information. Sharing this information with the blockchain is intended to increase food safety by enabling faster identification of bacterially affected lots quickly and efficiently.shutterstock_1211188477_lettucewarehouse

Data Masons is supporting this initiative by seamlessly integrating the necessary data from a produce supplier’s ERP and EDI systems to IBM’s Food Trust Network. Our technology platform combined with our PTI experience and Blockchain technology enables cost-effective compliance in a timely manner.

Passing the PTI data to the IBM Food Trust Network requires integration with a proprietary RESTful API for the exchange of data into IBM’s blockchain-based solution. Communication is one of the challenges for PTI compliance. The other major challenge is gathering and validating the data before integration to the blockchain, as accuracy is critical – once submitted, the data cannot be changed.

Wal-Mart expects traditional ASN (856) data to continue flowing to their systems, which means that the data has to be consistent and highly accurate. Data Masons’ platform “cross checks” ASN data to the PTI information submitted to IBM’s Food Trust Network to eliminate consistency issues. Furthermore, the Data Masons platform can achieve PTI compliance without customizations to existing systems which can be a significant expense for suppliers.

In summary, supply chain-related data exchange requirements are becoming increasingly complex across all industries. Suppliers will likely need flexibility in their systems to meet those evolving requirements. The Wal-Mart Produce Traceability Initiative is just one example of the future state of eCommerce. Our objective at Data Masons Software is to eliminate traditional ERP customizations and thereby increase flexibility in the exchange and translation of data in and out of the ERP. To learn how we're positioned to integrate with Blockchain requirements such as PTI, read our executive brief, or contact us today.

Download the Blockchain for EDI Brief

Managed Services, EDI

Simply put, Managed EDI Services is the pain relief for your EDI headaches.

Many companies and IT departments view EDI as a necessary evil of doing business today which is regrettable. The truth is that when an EDI program is implemented and managed properly, the benefits can be transformational to the enterprise. Removing human involvement in mundane business transaction flows will increase transaction processing velocity and help eliminate errors - saving both time and money. Improving your organizations responsiveness while reducing errors fosters better relationships with business partners.  At the same time, increasing your company’s business efficiency and reduced costs will increase profitability.

Sounds wonderful, doesn’t it? Well, just like anything that sounds too good to be true, there are several factors that come into play when looking at what it takes to keep EDI running smoothly, such as:

 

  • People that understand EDI in your business
  • People that understand EDI best practices
  • People that understand how to effectively communicate with your EDI trading partners
  • People that know how to manage trading partner compliance
  • People that have time to react to EDI alerts and the knowledge to be able to address themmanagedservices

That’s a lot of EDI stuff that needs to be covered, and since EDI is not usually a core competency of most businesses that utilize EDI, and most tend not to hire dedicated staff to handle this work, this stuff can become EDI headaches. This is where Managed EDI Services comes in.

Managed EDI Services is the management of your EDI operations by an experienced third-party provider. They simplify EDI for you by providing EDI specialist teams that understand your specific business processes and manage the day-to-day so that you can focus on running your business.

The day-to-day operational tasks that are handled by Managed EDI Services teams are:

  • Proactive monitoring of your environment
  • Responding to and resolving of all EDI alerts and addressing their root causes
  • Communicating with your trading partners on EDI related topics
  • Communicating effectively with your business stakeholders
  • Applying EDI best practices
  • Managing compliance to partner specifications

The Managed EDI Services (MES) team’s primary role is to ensure that your EDI runs smoothly. Since they understand your key business processes and are automatically alerted to all events that might impede your business flow, they can proactively act to resolve any situations that arise. They also address the root cause to avoid repeated issues in the future.

Communication with every stakeholder in your supply chain is key to the running of a smooth EDI operation, the MES teams actively work with both your internal business stakeholders and your trading partners to understand and report back so that does happen. They are also able to bring the company-wide experience to your environment by looking for opportunities to implement best practice and strengthen overall operations. The MES team is an integral part of your team.

At the business level, the major benefits of employing Managed EDI Services are:

  • Reduced overheads
  • Reduced penalties
  • Continuous coverage
  • Time to focus

Having a team of specialists working for you provides continuous coverage for your EDI functions. No scrambling to find coverage when your internal staff take vacation or are out sick, no more worrying about someone with all the EDI knowledge leaving.

Managed EDI Services boils down to a service offering that makes EDI simple for you by providing you with the piece of mind that your EDI activities are being handled and that you and your staff can stay focused on running your core business.

Data Masons has been providing integrated EDI services for over two decades. To speak with a specialist about how our experts can augment your EDI team, contact us today!

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EDI, Amazon, Seller Central, Vendor Central, Fulfillment by Amazon

It can be difficult to decide how to trade with Amazon, but understanding the differences between the options can enable organizations to best leverage the advantages of working with this leading eCommerce enterpriseIn this blog we’ll explain the differences between being a vendor and a seller, along with the fulfillment options available for both.  We also inform the reader as to how Data Masons can help companies fully automate their business processes with Amazon from order to invoice, regardless of the option selected. 
Vendor Central 
In this scenario, Amazon acts as a retailer, buying stock in bulk from a vendor and storing this stock in their distribution centers. The end customer then buys the stock from Amazon and the order is fulfilled by Amazon, so the end customer is Amazon’s customer. This means the communication with the customer is controlled by Amazon, and Amazon also collects margin on every sale. shutterstock_625771727

How Does Data Masons Help? 
Data Masons can integrate the entire Order to Cash cycle with Vendor Central via Amazon’s strict EDI requirements which can be fully managed by Data Masons on your organization’s behalf Data Masons can service interactions with Amazon in any country in which Amazon operates.  Data Masons seamlessly enables EDI with Vendor Central for all available Amazon Vendor Central interactions, resulting in lower operating costs for vendors that utilize Amazon’s portal solution.  

 

Seller Central 
When participating in Seller Central program, the supplier (seller) sells directly to their customers on the Amazon website. Amazon acts as a marketplace and it takes a subscription rather than margin on every sale. The seller controls the communication with the customer and can therefore build a customer profile, which can in-turn help with repeat business through targeted marketing. 

Seller Central also gives the seller more flexibility when changing settings such as delivery service levels, pricing and stock levels. This flexibility can be especially useful on promotional days like Black Friday, enabling a seller to quickly react to market conditions. For example:  

  • a competitor is selling the same products as your company at a discount you need to match on Amazon 
  • your warehouse is having issues, so you need to extend the delivery promise 
  • you want to alter the stock levels available on Amazon depending on how well all your selling channels are performing versus the stock levels you have available  

How Does Data Masons Help? 
Data Masons has a “ready to implement” solution that manages various RESTful API interfaces that are utilized with Seller Central. Data Masons can work with our clients to determine which ones are relevant to their use case to maximize selling potential and flexibility on Amazon. Orders are retrieved from Amazon automatically and then interfaced to existing ERP infrastructure.   The overall result is that distribution through Seller Central can be performed in an efficient, secure and reliable fashion. 

 

Fulfillment by Amazon (FBA) 
Fulfillment by Amazon is the third way that a company can utilize Amazon’s platform and services.  In this model, Amazon’s responsibilities include warehousing, shipping and even selling a company’s products but, unlike Vendor Central, Amazon does not purchase the goods from the seller and receive margin.  Instead, Amazon charges warehousing, selling and fulfillment fees Fees vary based on whether the goods are sold by Amazon or through other channels or eCommerce sites.  In detailed terms this is how FBA works. 

  • When FBA is utilized, the seller transfers goods to Amazon’s fulfillment centers and retains legal ownership of the goods. Amazon promotes the goods, receives orders, ships the goods and settles the payments that are remitted to the seller. At the same time, orders can be taken by the seller through other means and transmitted to Amazon for fulfilment but no billing is involved by Amazon.  In this scenario Amazon behaves like a public warehouse (aka Third Party Logistics Provider 3PL or Logistics Service Provider LSP). 
  • If both FBA and a company’s own distribution network are being used, the FBA API interfaces will only be run for the orders to be shipped via the FBA workstream.  

How Can Data Masons Help? 
Data Masons can fully integrate with Amazon FBA APIs and your Microsoft ERP directly or any ERP system that support EDI transactions such as X12, EDIFACT and even custom file formats. Data Masons can help companies utilize the optimal Amazon model for their business and become more competitive overall. 

To learn more about how Data Masons can provide seamless integration with your ERP for Amazon and other key trading partners, download our white paper, EDI Made Simple.

Executive Brief: EDI Made Simple: A New Approach

Third-party Logistics, EDI

Welcome to the third blog in our series about third-party logistics management via electronic messaging/EDI! The first blog explained that outsourcing distribution to 3PLs is popular with companies that are expanding into new markets or want to focus on their core strengths and let the logistics experts manage the physical storage and distribution of their goods.

We also discussed that in 3PL automation projects, interactions can be generalized into two master file exchanges and five transaction scenarios. Part 2 delved into the master file exchanges, and this blog, the third and final blog of the series, focuses on the five transaction scenarios.

Transactions

At a high level, warehouses are simple operations. Goods arrive, goods are moved around inside the warehouse, and goods are shipped. In the “real world,” things get a little more complicated, as goods can be damaged, stolen, expired, and have other issues that require inventory adjustments. Man_in_warehouse-1

Another factor (for a future blog), is the value-added services 3PLs provide to repack items into different forms and partner numbers. This “conversion” of inventory is similar to production environments where components are removed from inventory and new inventory is created with no physical receipt or shipment process. However, today we’re focused on the basic 3PL process for the simple distribution of finished goods.

To understand the basic premise of the X12 document’s intent as it relates to warehousing, imagine we’re commencing a new relationship. We’ve sent the item catalog information to the warehouse, so they know the item numbers and characteristics of the items they’ll be housing. The first step in the process is to ship goods to the warehouse. In a best practice scenario, we’ll send the warehouse a notice of in-transit goods so they can plan the receiving and storage activities. In the X12 standard, the document that fits this scenario is the 943 Warehouse Stock Transfer Shipment Advice. The data in this document can have many sources, such as a planned inter-warehouse shipment, purchase order, or ship notice from a related party. Regardless, it lets the warehouse know that goods are coming with a high level of detail.

When the goods arrive, the warehouse should inspect and possibly count the goods to make sure that what was scheduled to arrive did. If the goods are coming from a vendor, it’s essential to validate invoices and payments. The document that fits this purpose in the X12 standard is the 944 Warehouse Stock Transfer Receipt Advice.

The next logical transaction in the 3PL relationship is the X12 standard’s 940 Warehouse Shipping Order, which gives the 3PL the details to integrate into their internal systems for accurate fulfillment of the shipment. 

We want to know the goods were shipped and have details on freight carrier information, freight costs, lot numbers, serial numbers, and other crucial details for accounting and inventory control purposes.

The last common transaction in the 3PL process interaction is the Inventory Adjustment Process.  Because there’s always the possibility of inventory loss through errors and obsolescence, we’ll need a means for the warehouse to communicate what’s being disposed of and why. This scenario is covered nicely in the X12 standard by the 947 Warehouse Inventory Adjustment Advice.

Achieving a finely tuned 3PL process flow can deliver significant benefits to a business that distributes goods through outsourced warehousing. The discussion today is supported by the X12 EDI standard, but that’s not a prerequisite of a successful endeavor. Other formats, such as CSVs, XML, EDIFACT, JSON, and others can also do the job – but they require careful evaluation and implementation, as they are not supported by a highly evolved standard such as the X12 standard. 

We hope you find this information useful in understanding a simplified approach to 3PL project implementation. Again, you can find part 1 here and part 2 here. If you have questions, please contact us at techblog@datamasons.com or www.datamasons.com. And be sure to subscribe to our blog so you don't miss our next post!

Many of our customers have overcome challenges and found success with our EDI solution, which can take the headache out of 3PL and other business processes. Read our white paper to learn more.

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EDI, Amazon

Amazon Seller Central (Fulfillment by Amazon) can present challenges to companies with an existing EDI capable infrastructure by mandating the use of Web Services and XML data formats. Data Masons offers a simple and effective solution for those organizations that want a fast and cost effective way to integrate Amazon Seller Central into their existing EDI system. shutterstock_1152348296_packagesonporch

Data Masons now provides an EDI solution for Seller Central that manages the communications and translation of all messages to and from any EDI standard message such as X12 and EDIFACT. Setup can usually be accomplished in a day and has a low setup cost and modest ongoing fees. 

Amazon Seller Central offers companies a way to quickly enter new markets and outsource product distribution. Data Masons can quickly connect Seller Central into your ERP platform without any special changes to existing systems and infrastructure! Contact us to learn more, whether you’re an existing Data Masons customer, or considering us for your EDI needs.

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Third-party Logistics, EDI

Welcome to our three-part series of blogs about third-party logistics management via electronic messaging/EDI. We receive many questions about 3PL from our readers, and we’re excited to share our knowledge of integrating EDI with this business practice.

Outsourcing distribution to 3PLs, also known as public warehouses or logistics service providers, is increasingly popular for companies that are expanding into new markets or simply want to focus on their core strengths by allowing logistics experts to manage the physical storage and distribution of their goods.

To make outsourced logistics seamless and cost-effective, advanced organizations implement electronic communications. Data Masons has worked on over one hundred of these projects with stakeholders who have various levels of capabilities and approach standards. We’ve learned that these projects have consistent patterns that are useful to understand when approaching this type of project.shutterstock_396462703_warehouse

In our experience with 3PL automation projects, interactions can be generalized into two master file exchanges and five transaction sets (also known as documents). The authors of the X12 EDI Standard clearly understood how to manage interactions with a 3PL – the documents most commonly used by 3PLs are very well-conceived and documented in the X12 EDI standard frequently used by 3PLs.

The second part of our series will continue next week, discussing master file exchanges.

Read part 2
Read part 3

Data Masons has helped many companies integrate EDI messaging with 3PL. To learn more about how to streamline your warehousing, download our data sheet.

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