December 10th, 2020
E-commerce retailers typically see an increase in orders around the holidays, but COVID-19 has upped the stakes. This year, we’re not even sure it’s sufficient to say there has been an “increase” in online purchases—it’s more of a surge. This poses new challenges for retailers, especially when they’re up against digital giants like Amazon, a company with a well-oiled supply chain ready for anything that comes its way. So if the advantages of EDI in e-commerce haven’t already presented themselves to retailers this year, we guarantee that will change before the end of 2020.
Procure-to-Pay Automation Enhances Online & Omnichannel Experience
There are a few things that e-commerce retailers are facing this year that separates this holiday season from the rest. For one, demand hits differently. With the majority of consumers choosing to shop online, usual supply chain operations must be executed at a much quicker pace. For example, keeping warehouses stocked and coordinating with third parties to ensure on-time delivery. In fact, many e-commerce retailers with in-store locations have converted a portion of their stores to temporary warehouses for the increasingly popular “buy online, pick-up in store” (BOPIS) option in attempt to keep things running as smoothly as possible.
Along with this comes the challenge of maintaining profitability, ideally equal to that of in-store purchases. By now, most retailers have begun to automate their procure-to-pay processes to meet this requirement and are firsthand witnesses to the advantages of EDI in e-commerce. Fortunately, these advantages lead to an enhanced omnichannel retail experience as well. This is now more significant than ever before, as consumers who wouldn’t typically shop online are now doing more research on products beforehand to choose the best store to ultimately make the purchase in person.
From B2C Online Ordering to B2B E-Commerce
These new consumer tendencies have completely redefined the value of EDI in e-commerce, mainly because of the impact it can have on the omnichannel experience in terms of cohesiveness. When a consumer decides on a product online and ventures out to the store to buy it, they naturally want it to be there waiting for them.
But it’s also important to mention that business-to-business (B2B) online ordering is equally affected this year. Since it’s common for retail vendors to offer online ordering to their customers, the online ordering surge continues in B2B e-commerce transactions. After all, keeping warehouses stocked and sending orders out the door on time requires retailers to have seamless communication and coordination with their vendors. This is where it proves to be incredibly convenient for retailers to have a vendor portal in which their vendors can easily respond to purchase orders, inform retailers about delays, submit invoices, and more.
To guide you on your way to procure-to-pay automation this holiday season, here are four tips for optimizing your e-commerce supply chain so that you can meet consumer expectations with ease.
1. Engage in electronic data exchange with all your trading partners
The first step towards an optimized e-commerce supply chain is automating the exchange of business documents through electronic data exchange, or EDI. As you know, consumers want lower prices and faster delivery. When documents are exchanged electronically, and therefore, automated, processing times are reduced, enabling companies to ship products much faster. Additionally, automation can bring a considerable cost reduction when compared with manual processing—and these are just a few advantages of implementing EDI in your e-commerce strategy. To survive in today's competitive market, it's important to consider full e-commerce supply chain automation.
2. Enable electronic data exchange with all your trading partners
It’s one thing for us to say engage in electronic data exchange with your trading partners, but it’s also important that you enable electronic data exchange with your trading partners. In an ideal world, all trading partners would implement EDI and electronic invoicing, or e-invoicing, in their e-commerce supply chain model. However, in the real world, only about 20% of documents within a company are exchanged electronically. That means 80% are still sent in non-electronic formats (e.g. paper and PDF) and manually hand-keyed into back-office systems.
Manual processing causes delays, errors, and, ultimately, doesn’t align with your competitive strategy. The importance of EDI in e-commerce is that is makes it possible to compete with Amazon and other digital giants that have automated their e-commerce supply chains with electronic data exchange. The good thing is that there are innovative solutions that can help your suppliers—even the small ones who don't have an ERP or EDI software—to get on board with your digital supply chain efforts.
3. Facilitate partner onboarding
That brings us to our next tip: One way to enable EDI for all your trading partners in your e-commerce supply chain is to ensure a smooth onboarding process. In order for you and your suppliers to take full advantage of an automated e-commerce supply chain, they must be easily onboarded and integrated so that their documents can be validated, processed, converted into the correct format(s), and sent directly to your internal system. When suppliers can quickly connect to an EDI platform, it’s no surprise that more electronic data is exchanged.
But remember: Onboarding is not only limited to the technical side of systems integration. It also includes offering partner education and training, support, and more to ensure they are properly integrated. Each partner is different, and it's therefore important to consider customization for the suppliers who need it. Integrated suppliers are happy suppliers, and once the majority are connected, that’s when you’ll start to realize the vast benefits of implementing EDI in your e-commerce supply chain. You’ll notice that with automation, your business relationships and collaborations with clients will naturally improve.
4. Analyze your e-commerce supply chain regularly
If you truly want to be competitive in the e-commerce space, it’s absolutely critical that you regularly analyze your e-commerce supply chain in order to keep up with online retail trends, as well as predict future trends. With most EDI platforms, you have access to key document exchange data that can provide a lot of insight into your business—but only if you use it. Use this data not only to pick up on e-commerce trends for your business, but to detect, understand, and eliminate blockers in your e-commerce supply chain.