Last week while attending a family gathering in North Carolina, surrounded by acres of lush grasses and hardwood trees, I was reminded of the rapid changing nature of business over the past few decades. We were in Greensboro right next to High Point, once the furniture manufacturing capital of the world. Today, even though the annual Furniture Mart continues, many factories, warehouses and stores remain shuttered and abandoned. Businesses today are forced to search for new markets, business models and new methods of generating revenue.
During our visit we toured Replacements, LTD. (www.replacements.com) which started in the 1980s out of the trunk of a car. They serve a specialized niche as a catalog house for people who need to replace retired patterns of china, crystal and silver. Today they are the world’s largest company of its kind with 450 employees and sales north of $80 mm through their web site as well as eBay and Amazon.com. Doing business with Amazon.com is a relatively easy process for a company like Replacements, LTD. After signing up as an Amazon vendor, the transactions and inventory available are handled via the Amazon EDI Vendor Central system. Amazon EDI compliancy is fairly simple. They support three different EDI interfaces:
- One for small suppliers (~ 1 – 999 orders/month);
- One for mid-sized suppliers (~ 500 – several 1000 orders/month);
- One for advanced web services interface for rapid, near real time, order processing or higher volumes of transactions.
The small version communicates with Amazon via their ATMU proprietary software and the transaction files interface into either Excel spreadsheets or a small database such as Microsoft SQL. The mid-sized version uses standard EDI X12 PO 850, ASN Ship Confirmation 856 and Invoice 810 documents. Communication is via standard AS2 encrypted EDI through the internet. Amazon calls this version “Simple EDI.” The advanced version uses web services and XML documents for orders, shipment confirmations and invoices - in real time. Any of these options would make you EDI compliant for Amazon.com.
Depending upon the category of product that you sell, Amazon charges a percentage fee (i.e. ~15% for CDs) for sales plus a modest monthly fee. You can ship the products directly to the customers (drop ship), or you can have Amazon handle the shipping (fulfillment) from inventory in their warehouse for a small fee. So the moral of the story is that regardless of your company’s product, Amazon.com and EDI technology can be a new avenue to increase sales during these changing times. Would you rather thrive and embrace new opportunities? Or would you rather close your doors like those once successful furniture manufacturers? It’s up to you.