With the economy heating up and companies out there cooking, our clients are looking to grow and find more efficient ways to deliver their products.
Over the past three years several of our clients have done something which we really haven’t seen before, at least not quite like this. These changes in strategy seem to come in more like ocean tides rather than in a massive swoosh.
What am I referring to?
Not one, but MANY of our clients are switching to larger and more robust (3PL) 3rd party logistics providers to increase the heft and response in distribution to their end customers. They can’t do it themselves, so they reach out to companies that can, such as Expeditors International, Ingram Micro Logistics, UPS Supply Chain Solutions and more.
In addition, they are breaking into new international markets. This is no trivial pursuit - it’s a huge investment of time and money in the infrastructure to support these relationships. Companies' systems are tightly integrated with the 3PLs to support sales and ship orders, shipment advice confirmations, supplier POs, receipt of goods, as well as RMA (return authorizations) to support warranty returns, inventory adjustments and synchronizations and more. Often these transactions are done in XML with web services, other times with traditional X12 or EDIFACT EDI, and even the transfer of spreadsheets and .csv comma delimited text files. Moreover, international transactions take on added complexity with VAT (value added taxes) and additional data required.
Brexit hasn’t helped either. Customers are actively switching distribution out of the UK on short notice to the EU simply because they are unsure of what will happen if England breaks away.
EDI, regardless of which specific format is employed, is the bridge that makes everything happen.
The "UAT" unit testing sessions to make sure everything is working properly as expected are like a rocket launch, seriously. Typical UAT calls involve the supplier in one city, the 3PL technical and operational staff in a couple of different international cities, and myself here in Los Angeles with 3 monitors going, covering the "EDI desk" where we monitor, test and debug communications and security, while processing the different documents to be exchanged. It’s like cable news but "more serious" if you will, because the name of the game is for everything to work precisely in sync.
Keeping track, I’ve been on calls with Japan, Australia, Canada, Puerto Rico, the UK, EU and all over the US, facilitating setup, testing and production of EDI with 3PL distribution. I’ve got to admit it’s fun and exciting, but challenging as well. Fortunately, the EDI software our team uses really holds it all together and reliably makes it happen.
The suppliers know their business well and the 3PLs are masters at what they do, but it is the EDI process that acts as the master communicator allowing them to really tango together in perfect rhythm.