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IRCE 2019: Perspectives on EDI

IRCE 2019: Perspectives on EDI

Internet Retailer Conference & Exhibition

We trust that everyone reading empathizes with the pain of trade shows – at the end of the day your feet hurt and your throat is sore from talking. Yet we all keep attending: Gluttons for punishment or the long-term value far outweighs any transient discomfort?

The latter, for sure. (There is always a little gluttony… but it more takes the form of trying all the great restaurants we can fit in!) As you know if you read our July Newsletter, we were at IRCE in Chicago in June. We’ve had a chance to debrief internally and we want to share the discussions we had around EDI.

As one might expect, as we are EDI experts, we spent a fair bit of time exchanging industry insights at IRCE. The question that seems to repeat year after year is “where is EDI going”? We think the question arises from the longevity of EDI – it has been around since the mid 80’s. People wonder if there is some shiny-new-thing that is better: For the record, there is not! Partly because the foundation is so solid, and standards so entrenched in the industry. And partly because the of EDI today is not the EDI from 1985: It has evolved and grown and been adapted to current needs. Companies like Integral Group are building services around traditional EDI to complement the basics that were already in place.

While at IRCE we talked with David Gearhart (industry analyst and venture capital investor). In a recent post, he made many interesting points, a few of which we will highlight here:

“Unsurprisingly, the core driver universally highlighted was cost savings, as companies can eliminate the internal teams dedicated to maintaining EDI connections and partner rule books after adopting a third-party solution or redeploy those development resources elsewhere to more value-added tasks".

“The other typical drivers mentioned were the consolidation of interactions to one entity (i.e., an EDI vendor) from potentially hundreds of trading partners, access to custom integrations (to ERP systems, etc.) and other products/services that go beyond EDI, and the rise of drop shipping (items sold by a retailer via its website that are not kept in inventory, but are instead shipped by the supplier directly to the customer)."

“Retailers are relying on EDI to support drop shipping as it underlies existing workflows, and suppliers are having to adopt it to be a part of a desired retailer’s drop ship program".

We concur with everything that David has said above; sound points, every one. And they present a clear road map for suppliers to outsource their EDI. Suppliers need to choose an EDI service provider that will help propel them forward, be respectful of their bottom line, and one who is driven to always be looking for better, faster and more economical solutions. That service provider is Integral Group.

David also raised some questions directly with our Director of Sales, Lee Mrkonjic, that speak to future trends of the industry. David asked some pointed questions about a competitor - whose name we have redacted – but Lee’s responses speak to Integral Group and the industry as a whole. We will recap a few of the questions and responses here:

DAVID: “What is driving industry adoption of outsourced EDI solutions? Please specify a few reasons."
LEE: “The number one reason for outsourcing [EDI] is that it costs too much if it takes IT resources away. Spend the time and money on the latest ecommerce technology instead. Outsourcing is so much less expensive, and the expertise is readily available."

DAVID: “How would you characterize industry pricing? Stable? [Company name redacted] has mentioned the potential to raise prices. Do you think this is realistic?.”
LEE: “[At Integral Group] We're always looking for ways to reduce the cost for customers. I encourage [Company name redacted] to raise their prices - that's good for us.”

DAVID: “Any trends in EDI you would point out?".
LEE: “API's in general and the whole IRCE thing. There are so many new opportunities for us with integration: EDI, shopping carts, shipping systems, WMS, TMS etc. As companies move towards the new technologies, it usually comes back to EDI at some point. We get the best of both worlds."

DAVID: “In general, how sticky are EDI customers? When they churn, what is the reason?.”
LEE: “Very sticky. We have customers going on 15+ years. When we win customers away from [Company name redacted] it's because of their poor customer support or a bad project experience.”

Further to Lee’s last point, many people – David, customers, new people we met – talked about things that raised their ire. When you see the most mellow of people get visibly angry, you know a nerve has been touched. Time and time again we heard that raw nerve is poor service and support. Sadly, there is not always a correlation between a fast-talking sales person with a slick website extoling corporate virtues, and the day-to-day experiences of the customers. Everyone faces enough challenges in business without doing battle with their service providers. People complained about long wait times and slow resolutions for support tickets, difficulty actually speaking to someone and dismissive support people. We get that … at Integral Group, our commitment to fast, efficient, friendly service is the cornerstone of our business model.

Want to swap stories with Lee Mrkonjic about what’s going on in the industry? Give him a call or email.

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