Point of Sale Success: Part 4: Understanding Manual Vs. EDI 850 Electronic Orders
- Tom Modeen
Manual Vs. Electronic Orders: Its Up to your Vendor
Now that you are prepared to send selected vendors your required inventory orders, it is extremely important to understand the options Point of Sale affords you in sending those orders. There are two possibilities: Manual Vs. EDI 850 electronic orders.
The type of order you will send will be predicated on the IT sophistication of your chosen vendor.
Manual Orders: Faxed
Smaller, less sophisticated vendors do not have the IT infrastructure to accept an electronic order. Their order department is built on the framework of receiving orders by fax. The Point of Sale System you implement should be flexible enough to trigger a faxed order, on demand. It is transparent to that vendor how that order was created (Min-Max vs. On-Demand). The salient functionality remains: a legible and clear purchase order with the relevant vendor order information.
Once the order is created and faxed, it is critical that the Point of Sale System retains the order details so inventory can be easily received upon delivery.
EDI 850 Electronic Orders
EDI ( or Electronic Data Interchange) 850 Electronic Orders are based upon wholesaler industry standards and yield an electronic purchase order that gets seamlessly transmitted to the preferred vendor. Order information includes a key ingredient: the vendor order number, housed in the POS item file.
EDI 850 Electronic Ordering has been adopted by every leading wholesaler in the country and has some major advantages. Sending an order in this manner closes the loop in the entire supply chain. Once an order is successfully executed, an accompanying response from the supplier is transmitted back to you and imported into your Point of Sale System. This response is also an industry standard and is labeled the EDI 855 Confirmation and Acknowledgement record. It essentially confirms that the item you ordered is in stock and that the supplier will ship the order to you. Contained in the 855 record is your current acquisition cost per item ordered and will match your invoice.
Receiving an 855 Confirmation and Acknowledgement response makes the entire inventory receiving process simple. Faxed orders will have to be received line item by line item when are delivered to the store. However, receiving an 855 to accompany your order means that orders can automatically be received and added to inventory. This is of huge benefit for efficiency and accuracy.
As you can see manual faxed orders and electronic EDI 850 orders will be required functionality on the Point of Sale System you choose to implement.
For more on EDI ordering basics, please review the following post. http://www.edibasics.com/what-is-edi/
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