EDI Sales

EDI Sales Processing In Gl0bal Supply Chain

EDI Sales Processing described below cover such topics as In-store Determination of Quantities Required and Vendor Managed/Assisted Inventory. This information will be useful for those who are involved in warehousing, logistics, retail and supply chain in general.

In-store Determination of Quantities Required

Store personnel check the shelves and communicate merchandise needs to the buyer. This model is very common in distributive ordering/authority retail systems. The stores can determine inventory quantities quickly by looking at their inventory and they can also determine their additional product requirements based on their knowledge of local requirements. This model works only if there is a distributive ordering authority and there are a number of qualified individuals at the store to create an order. A consideration in this model is that purchases from a central buying office will cause overstock situations if purchases are not communicated to the stores (and vice versa on store orders communicated to the central buying office). As reductions in store personnel have become common in the retail industry, this model is becoming less and less used.

Vendor Managed/Assisted Inventory

Vendor to determine order quantities, either via EDI Sales Data or by the use of “merchandisers” to determine on-hand quantities. In this model, the vendor is in charge of maintaining the inventory. The vendor captures inventory information either manually, by the use of merchandisers, or electronically through an EDI Product Activity Data report. The vendor “orders” product for each store, using the inventory information. In the manual method, vendors employ merchandisers, who go to the stores, re-merchandise the shelves, move any excess product from stock rooms on to the retail floor and determine what inventory is required for this site. The merchandiser will communicate these needs to the vendor’s representative. The vendor’s representative will then accumulate the store’s needs and create either a Purchase Order or call on the central buying office to create a Purchase Order. This method is very similar to the store-created inventory model. The difference is that the cost of the merchandiser is paid for by the vendor (the cost is indirectly charged to the retailer in the form of higher product cost).

In the electronic capturing of information, the retailer captures sales data at the POS. The data is then communicated to the vendor via EDI. The vendor inputs the POS data into a VMI (Vendor Managed Inventory) system. The VMI system will then calculate (based on order quantities and minimum stock levels) an order. The order may be sent to the retail buyer electronically via an EDI Purchase Order or may be reviewed with the retail buyer by the vendor’s representative. This method has the same issues on inventory accuracy as the “in-house” electronic capture of Sales Order model.


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