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The Road to Electronic Data is Surprisingly Paved... in Paper

Updated: 4 days ago

The Transcontinental railroad had to build track through the mountains and the Great Plains to connect the west and east coasts of America. This seemingly useless effort was a necessary milestone that laid the connective fiber for interstates and midwestern hubs. It helped make our nation what it is today. After a decade in business, I cannot believe we still process so much paper. And now... it is time to explain why I believe the connective road between small and mid-size retailers to the technology opportunities of our industry's future... is going to be paved in... of all things... paper.


We set out to build technology that would help small and independent retail owners keep up with their pricebook and monitor their profits. Being a small retailer myself, I insisted to my business partner and engineer that no retailer would implement an inventory solution if they had to key in this much data. Every technologist wants to work on 'sexy' problems. A.I. and data analytics. At the time it was mobile technology. But it took about 30 minutes of manual data entry for him to throw up his hands and say, "No one is going to do this. We have to fix it." And this began our electronic receiving journey. It surprised us all to find it paved in paper.


EDI - The story of mismatched business models

Electronic Data Interchange goes back as far as the 1970s and has been the industry accepted practice in retail forever. The supplier becomes easier to do business with by exchanging orders electronically, and the retailer orders more from suppliers who make things easy. And so EDI became a MARKETING expense for the supplier and no real cost to the retailer. Nice gig if you can get it. But the model drops off with the size of the retail order. Not because you are unimportant. It’s just a math problem. Everyone wants EDI right now. Your supplier’s technology team wants you to receive it. But frankly, the bottleneck is officially decades long. There are only so many resources to go around and there's a cost for every customer in this business model. Suddenly, OPERATIONALLY critical data for you, is at the mercy of your supplier's MARKETING budget. Restricting your access. You are welcome to wait. They will put you on their list. But it might be another 20 years. We’ve made a lot of friends with suppliers; patiently waiting for them to get to us… and consequently all our stores as well. Meanwhile, we fill in the gap with paper and relieve a lot of tension and stress in the process.


Standards and the Forgotten Costs of Data Quality

Standard bodies have worked their tails off to make interacting across systems easy. However, a colleague, who is now a great friend and advisor, was pretty upset with us about our paper approach when we started, "Companies like you are giving suppliers an excuse not to send me EDI." Aggravated, she hated having to pay for data. So, let me explain. Standards make things easier, but there are other issues regarding the details of the data values itself that standards alone cannot address. Let's pretend someone fat-fingered the new UPC for the latest flavor of Dr. Pepper. Or another resource didn’t put the right list of detailed items on a shipper. Or maybe your inventory isn’t ready for restaurant quantities yet. Or a random system update prevented your invoices from being received. How do you want to handle credits and returns? You get the idea. Now, let's ask ourselves what changes in a support process when one retailer on behalf of hundreds of locations calls for help vs. hundreds of single-store retailers. You can see how this could quickly turn into a nightmare. With Deep Water, small and independent retailers can be as easy to do business with as any large retailer (at least in this process)... and support all the crazy new flavors that suppliers love for them to try. We provide a necessary layer of insulation for both to breathe a little easier and prevent unnecessary strain.


Retailers AND Supplier Systems Are Changing at Historic Paces

With the onset of SaaS, access to new and sophisticated technology is increasing for all sizes of retailers and suppliers. This is creating a historic pace in the shifting of our technology landscape. Suddenly, we have a constantly moving set of systems and integration approaches… and with it… a shifting set of standards. When you also consider the advancements in data security, payments, block chain, etcetera… this world isn't going to stabilize anytime soon. Small to mid-size retailers need to insulate themselves from the impact of technology chaos and normalize the type of data received when it comes to critical information like whether they have enough beer and Dr. Pepper. They need a system and set of processes that can function throughout the inevitable bumps along the way with minimal impact to their retail operations - including their own shifting systems. No one has time in this market for missing inventory and products.


Because maximizing your Back Office is just smart business…

The ability to receive data electronically was a selling point when you purchased your back office. But a few dozen more connections in a sea of 1000s of suppliers for a subset of customers could sacrifice attention from digital couponing, A.I. pricing, mobile pricebook access and so forth. Or… maybe you’ve not even managed to get to item-level receiving. How much more of your technology investment could be utilized with this automation? What would happen if you could ‘grow into’ this change because the data can be adjusted to your needs? What would the impact be on your systems and operations if data were timely and high quality and not reliant on shifting employees or staff? You made a big investment. We can help give your back office a chance to be everything it promises to be without costing you dozens of man hours. Just read the many comments from our back-office partners and their customers.


To survive, every retailer will need to be able to tell their customers what and how much they have for sale through a button click from any device. Getting this list starts in receiving those items into a digital inventory. But that process doesn’t have to be hard. For less than the cost of a Bag-in-Box Dr. Pepper... and in less time than it takes for the order to arrive... you can be operating at 100% electronic. And yes… you can jump on this road to electronic… paved with paper… and be there before the pending Christmas season begins.

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