Stating prices in EDI orders has penetrated retail market and newly spread among e-shops30. November 2017
30th November 2017, Brno – Stating purchase prices in electronic orders towards retail suppliers is becoming an established practice also in the Czech Republic. This novelty in electronic document interchange (EDI) has launched with its suppliers a leading Czech e-shop MALL.cz. The successful pilot project has been executed by Henkel with a chain store Makro. The aim of this step is, in particular, to achieve more advanced automation of cross-check of documents within the sales chain and smoother flow of goods.
„There is a whole range of situations when the expected purchase price of the buyer is at odds with the actual invoiced price. It can be, for example, human failure, technical error, specific sales promotion or time discrepancy between the moment of issuing order and vendor's revaluation. However, if the vendor actively works on the price in ORDERS and finds out about this error in time, it is possible to start an internal process of blocking further processing, verifying the correctness of the price and searching for the cause. Owing to that, it is possible to avoid even the creation of corrective tax documents in a considerable percentage of cases. In the extreme case, it is possible to prevent the return of the goods back to the supplier and the resulting logistical and transport costs and to eliminate the damage to the business relationship,“ says Michaela Malíková, EDI coordinator in Internet Mall a.s., that runs an Internet purchasing gallery MALL.cz.
A major internet retailer, MALL.cz, became the first Czech e-shop to actively work with purchase price in orders within electronic interchange of business documents (EDI) together with vendors. Thus, it has built on the positive experiences that other retail subjects also have with this solution.
The longest experience with using purchase prices in orders on the domestic retail market has a Moravian purchasing headquarters of COOP chain store with its vendors, connected to EDI solution from CCV Information Systems. However, other vendors may have also come across prices in EDI orders, typically those delivering to foreign customers or local DIY chain stores that use EDI solution of their foreign headquarters.
Price in orders will, however, soon cease to be the domain of only customers using CCV's EDI solution (COOP MORAVA, Velká Pecka – Rohlík.cz, UniHobby, Alza, Datart, Tempo, retail cooperative, Jednota Boskovice, Rosa Market (stores Enapo) and others. Makro Cash & Carry chain store is also finalizing an introduction of prices into orders.
Reaction to market requirement
The incentive to incorporate purchase price into ORDERS message thus came about synergistically both from retailers themselves and from the key EDI providers who had been pushing it over the years on the basis of market analyses.
The proposal and the process of subsequent implementation was managed by a work group EDI under Czech-Slovak initiative ECR „For all traditional traders as well as in new segments, the price has always been one of the basic requirements. That's why our clients have been able to work with it in EDI communication of documents since 2002. However, in the long run, we did not succeed in putting this into operation on the Czech-Slovak market. We were, therefore, pleased when the same requirement was brought to ECR also by Makro C&C and using the mutual experiences of ECR members on our market, an extension was created, which was based on the international standard EDIFACT and the local version of the industry subset. A modified version was, thus, created that Makro C&C under ECR released for the whole market. It is therefore a unified technical description in the world of common solution that can now be used by all senders and recipients of electronic data interchange in EDI business in the Czech Republic and Slovakia,“ says David Reichel, Director of CCV eBusiness division and an active member of ECR work group that has prepared the extension of the subset. Successful verification of the extension of the subset's data sentence took place during a pilot project between major business partners, Henkel CR and Makro Cash & Carry CR.
Using structured data in paperless disposal of documents
Electronic data interchange (EDI) in structured data enables paperless disposal of invoices on the side of the customer. It is not only automatic processing of data from the document directly into an information system but the received EDI invoices are in case of conformity with the order or delivery note also processed by a machine until posting without the need of any human control. That's because these are validated against the actual receipts to the warehouse and the purchase price in the order. When both validations succeed, the received invoice disposes itself (processes and posts itself) and moves to the financial department for payment, therefore human control only occurs in cases of unconformity.