Why Do Retailers Frequently Change Their EDI Specs?

by | Aug 5, 2014

Written by Bekki Windsperger

“Why do retailers keep changing their EDI specs?” suppliers ask us. “Do they hate us?” No, not at all. (They think you’re great; they told us so at lunch last week!)

But there are some pretty good reasons why retailers keep changing their specs, and why suppliers should keep up with them. A lot of retailers change their EDI specs fairly regularly, and I understand what it means for suppliers. Having worked with retailers at SPS Commerce, as well as my own experience at a retailer, I can tell you why retailers make these changes. (I promise, “to inconvenience our suppliers” is not on the list.)

The number one reason retailers change their specs is because they’re making major changes or upgrades to their ERP software system. They’ve found some additional data that’s needed for their business processes, or that they can share with suppliers. The only way they can do that is if they get suppliers to make a change as well.

For example, my old employer moved their international business from an Oracle ERP system to an SAP system. Suppliers that supported our private label program had to make significant changes because the new system required more information than the old one. There was other data that was important for us to share with vendors or other trading partners involved in the supply chain, and we could only do that if suppliers changed.

Another reason is because the retailer is bringing on a new business unit, or they made an acquisition. As part of a new acquisition, they might be moving into new products and categories, and they’re expanding the types of products they sell. There may even be new product attributes that have to be shared, which means making changes. This requires a change on the specs that all suppliers have to match, even if they’re not affected.

Or maybe the retailer is changing some new business processes internally. It could be that a manual process of sending orders to freight forwarders is becoming automated. Or a new warehouse has entered the supply chain and they need certain types of information. The data won’t be visible to the suppliers, but the warehouses will need it.

Retailers don’t make changes to their EDI specs just to make it painful for their suppliers. It takes a lot of effort for the retailers because they’re changing their applications and EDI systems, and they know it will affect all of their suppliers.

Retailers tend to have more relationships than suppliers — thousands at a time — so they don’t make that decision lightly. When they change, it can represents hundreds of hours of work before the suppliers ever need to change a single data field.

Besides, there may even be some additional payoffs. I’ll discuss those in my next blog post.

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SPS Commerce Blog Team


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