Logistics - Redwave Commerce

By: Redwave Commerce  09-12-2011

Supplier Direct Fulfilment

For a variety of reasons vendors are increasing the amount of products they sell to customers where the item is shipped directly from their supplier. If done well the vendor can increase the range of products sold while holding or reducing inventory costs. Nowhere is this trend more pronounced than with eCatalogues where the customer never sets foot in a store or sees the physical product. However the business model is also used in many other scenarios where sales volumes can’t justify carrying inventory, the product is built to order, special handling is required, etc.

The challenge facing the vendor is that they want to provide their customer with a consistent level of service regardless of the logistics model, recognizing that any issues that arise with fulfillment will reflect on them and potentially impact the existing and future sales. As a result, in most cases the vendor strives to act as the main interface to the customer, keeping the fact that the product is being drop shipped invisible.

With this objective, areas that can cause problems for the vendor are:

  • Keeping product information synchronized with the supplier.
  • Providing the end customer with accurate inventory-on-hand and estimated delivery information at the time of the order.
  • Providing the customer with consolidated order and shipment status information after the sale.
  • Having the supplier include vendor branded shipping documents with the delivery to reduce customer confusion and facilitate three way matching.
  • Detecting exceptions in the multiple steps of the order and fulfillment process across many suppliers and hundreds of orders so that potential problems are resolved before the customer is impacted.

Addressing the challenge requires formalized electronic communications between the parties. But to achieve this, the vendor must have a solution which deals with the diversity in their supplier community. As represented in the following diagram, suppliers run the gamut from those who can already provide all the required information electronically to those who can’t provide any.

Redwave Commerce provides a portal based solution for companies attempting to improve their management of drop shipments and which supports the diversity. The portal provides an interface for the suppliers and carriers to send and receive transactions, either via forms or directly with their applications, and a management interface for the vendor.

Redwave’s solution works with the existing environment by facilitating what the participants cannot do and not replacing what they can. Further, through event management and reporting, it allows the vendor to be ahead of the process, preventing problems rather than attempting to remedy the issues afterwards.

Features for the suppliers include:

  • An easy to use mailbox interface which provides an audit history of documents that have been sent and received.
  • Ability to send and receive documents either via forms or by exporting and importing data directly to/from an application.
  • Support for hybrid relationships which lets the service work with existing infrastructure and applications. For example the supplier may already receive Purchase Orders via EDI but is unable to return a PO Acknowledge and / or an Advance Ship Notice (ASN). In this case the service captures a copy of the PO transaction which it uses to pre-load forms for the supplier to send the required responses.
  • Integrated workflow and event management which informs the supplier when an action is required and what it is. For example the service can track whether a supplier has returned an ASN and trigger a notification if they haven’t done so by a specified date.
  • An interface for the supplier to create branded packing slips according to the vendor’s format for printing and inclusion with the shipment.

Features for the vendors include:

  • A management interface tracking transactions sent and received. Search and filter capability make it easy to find and review the items of interest. The status of all orders and shipments is available, including errors, changes to the original order, delays in the process and incomplete actions.
  • Translation services for converting between the format used by the supplier and that required by the vendor.
  • Event detection and notification based on business rules for support of management by exception. For example the system can notify the vendor when a supplier has made changes in the acknowledgement or has not shipped product by the requested ship-by date.
  • The service can normalize data across different document types for tracking purposes. For example different suppliers may use different transactions for acknowledgement, such as a POA, ASN, FA or a proprietary document. These various types can be normalized to one, simplifying reporting and the triggering of events.
  • Partner performance scorecards help identify problem areas that require remedial action.

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