Sharing data is a new trend as retailers are continuing to do more sales with less inventory, and are asking merchants and buyers to manage more categories while provider fewer and fewer resources; it’s about helping the suppliers to help the retailers, according to Mark Hubbard, senior product manager, trading partner intelligence, at SPS Commerce.
There are two types of data that need to be shared, Hubbard says, such as how is vendor performing from an operational perspective: are they shipping complete orders, are they on time or late and are they meeting different retailers’ business requirements? The other type is the performance of the products; giving a supplier insight into historical data: how many pieces might have sold last week versus the week before. That gives the supplier “pretty substantial [information] that’s beneficial to understanding what’s happening in the marketplace, identifying opportunities and taking the data and managing their supply chain better as well,’’ says Hubbard.
Retailers are realizing they need to get more systems and really leverage their vendor base, since they are the experts in the product field, he says. “As a buyer I may be responsible for 12,000 items but as a vendor I may only have 20 or 50. So I’m going to have a better … understanding of what’s going on with that 20 or 50 across the retailers if I get data.” Then, he says, the supplier can identify trends it can provide as a backdrop to retailers on what’s going on in the industry. “The supplier already knows what they’re shipping to you so on the tail end they understand what your buying and you as a retailer get benefits from that because there’s no real downside to the supplier taking that information and using it to educate themselves on the market and position themselves better.”
Yet this is not widespread in the industry, he adds, because “There are still some retailers out there who believe point of sale data will be used against them and they don’t want to share that data for competitive reasons.” In addition, some don’t have systems in place that provide the ability to share data points on performance, Hubbard says. “The other reason is specifically around the point of sale systems — retailers have traditionally not seen a ton of return on their dollar from providing point of sale information and that comes out of the fact that there haven’t been systems in place to allow suppliers to maximize [them] and do something with that information.”
The shared data model
That’s not the case with home textile and décor retailer Anna’s Linens, which is reaping the benefits of sharing POS data with its suppliers. By the end of 2012, Anna’s will have added over 50 new stores to its roster of more than 280 stores in 19 states. That necessitated transforming its supply chain operations over the last few years by adding new distribution center capabilities with cross-docking functionality. Anna’s deployed an Extended Enterprise Management (EEM) system from Manhattan Associates with Direct Import capabilities, leveraged EDI functionality to streamline accounts payable and focused on inventory reduction opportunities.
Early in 2011, Anna’s senior management decided to use third-party providers for other aspects of the business not considered to be a core competency and subsequently decided to outsource its EDI testing and vendor EDI on-boarding efforts to streamline its supply chain. Anna’s partnered with SPS Commerce to perform the testing and certification of all the new vendors the retailer began using for purchase orders, advance ship notices (ASNs) and other transactions to ensure they could support Anna’s electronic trading requirements.
And Anna’s is growing its e-commerce and drop-ship business, as well as expanding into new merchandising categories. Consequently, the retailer needed to add new vendors and expand EDI transactions with existing vendors, and today more than 150 vendors are fully EDI compliant with Anna’s systems.
Anna’s had shared POS data and several vendors received detailed information via an EDI 852 document while other vendors received a weekly spreadsheet summarizing their sales across all stores. However, vendors did not use POS information consistently, making it difficult for buyers and vendors to have relevant conversations about this data.
In August 2011, Anna’s launched a POS data initiative based on SPS’ on-demand Trading Partner Intelligence service. Now Anna’s vendor base has online access to view weekly POS sales data along with their buyers. Both parties can view and interact with the information in detailed and summarized reports since it is accessible by Anna’s and its vendors.
Many vendors also wanted to have detailed POS information for their internal ERP and replenishment systems. Via SPS Anna’s is sending EDI 852 data to vendors requesting it, and vendors can also export their POS data into a spreadsheet from within Trading Partner Intelligence. This is enabling a new level of collaboration to review item performance, according to the retailer.
The way that SPS structures it, is there is no cost to the retailer, notes Hubbard. “All they need to do is provide the data and we work with them [in] a supplier paid cloud model. As we’ve tailored this message and gotten this crafted right there haven’t been a lot of retailers that have said no” to using the TPI system.
There is no downside, Hubbard adds. “The only cons that arise are out of not doing this.”Last modified on Saturday, 29 September 2012