The Evolution of the Retail Industry
The Evolution of the Retail Industry
The first commercially available cell phone was the Motorola DynaTAC 8000x, it hit the market in 1983 and weighed 2 pounds. It was priced at $3,995 and offered a half-hour of talk per battery charge. Today’s iPhone7 weighs 4.55 ounces, offers a 5.5-hour battery life depending on your usage and is priced between $649 and $849.
The Retail Industry Evolves
The retail industry like the cell phone industry has evolved, retailers need POS solutions that have the latest technology, instantaneous communication, and offer cost-effective solutions. The industry has evolved like everything else, and adapting to this evolution is how many retailers will not only survive but thrive.
The first commercially available cell phone was the Motorola DynaTAC 8000x, it hit the market in 1983 and weighed 2 pounds. It was priced at $3,995 and offered a half-hour of talk per battery charge. Today’s iPhone7 weighs 4.55 ounces, offers a 5.5-hour battery life depending on your usage and is priced between $649 and $849. The retail industry like the cell phone industry has evolved, retailers need POS solutions that have the latest technology, instantaneous communication, and offer cost-effective solutions. The industry has evolved like everything else, and adapting to this evolution is how many retailers will not only survive but thrive.
There are many changes that are happening in the retail industry, too many for me to cover in this blog post, but I do want to focus on two in particular. First, I want to focus on the adoption of the latest technologies retailers need. The second evolution, change, is the need for instantaneous communication. These changes are dependent on one another, as technology evolves so will real-time communication and the speed in which data is communicated. The two go hand in hand.
If a retailer does not have the latest technology the more likely they are not to have instantaneous communication within their POS system. The technology we use often times dictates how quickly the message, information, or package gets sent. If I write a letter to someone and send it to them in the mail, it will get there in 2-3 days. It will be at least 5-6 days before I receive a response from them. On the other hand, if I send an email to that same person then they have the ability to read and respond to it almost instantaneously. The communication channel dictates the speed of the communication.
This concept is also true in the retail industry if a retailer does not have a POS system that is real-time or if there is a delay in the system which can cause retailers to have serious issues. Retailers can be receiving inaccurate information that can lead to overstock, understock, and at worst out of stocks. EDI stands for Electronic Data Interchange. It is the electronic interchange of business information using a standardized format; a process which allows one company to send information to another company electronically rather than with paper. Like, all other industries, the paper industry has changed unfortunately for the worse. Paper is no longer the medium of choice for communication, marketing, or general work materials, everything has become digital. People, companies, and vendors are looking for digital communication.
What EDI does is take your catalog imports, vendor quantities, purchase orders (POs), PO acknowledgments, ASN Records, invoices, and much more and digitizes it so you are no longer dealing with paper. Processes that used to be paper are now automated, which allow retailers to concentrate more important tasks. Vendors and retailers can quickly and accurately process business documents, which leads to less re-working of orders, fewer canceled orders, and no out of stock issues. EDI also makes communication between vendor, retailers and generally all parties involved quicker and easier.
Companies no longer have to fax purchase orders to vendors who would then complete the order and fax acknowledgment back to the retailer. With EDI this process is completed through the retailer’s system and there is no paperwork involved. The retailer sends the PO online, the vendor sends back the PO acknowledgment digitally, and nothing gets lost or miscommunicated. EDI streamlines the communication and ordering processes so nothing can be misunderstood, misinterpreted or not received.
Through EDI retailers have the ability to automate data exchanges between applications across their supply chain, ensuring the business-critical data is sent on time and can be tracked in real time. EDI also allows for real-time visibility into transaction statuses. In turn enabling faster decision-making and improved responsiveness to changing customer and market demands, and allows businesses to adopt a demand-driven business model rather than a supply-driven one.
Change is something that every market, industry, and company needs to deal with. Companies that have been around for decades have been able to survive as long as they have because they have been able to manage and adjust to their changing industries. Companies that have not been able to adjust to market changes like Blockbusters, Radio Shack, and others have failed because of this inability. The retail industry is no different- it is experiencing a radical change in the market and staying ahead of that change is how retailers are going to succeed. EDI is one of those many changes and it is transforming the retail industry from a paper dependent industry to a digital one.