VendorNet Dropship Manager

Transcription

1 Web-based Supply Chain Collaboration VendorNet Dropship Manager White Paper January 2010 Contact: Sharon Gardner VendorNet 1903 S. Congress Avenue, Suite 460 Boynton Beach, FL Phone: Fax:

2 Introduction VendorNet Dropship Manager is a web-based supply chain collaboration solution that enables retailers to electronically integrate with suppliers for online ordering, purchase order and packing slip generation, order acknowledgements, ship confirmations, invoicing, estimated ship dates, customer service functions, and more. VendorNet eliminates significant paperwork and manual processes typically required to facilitate dropship order transactions, and provides retailers with more confidence, control, and visibility with their suppliers. VendorNet s open technology platform provides maximum flexibility for integrating with various host and target supplier systems. Suppliers have the option of interacting with VendorNet using its browser-based web pages (typically used by the lower tech suppliers), or its file exchange functions through VendorNet s automated file download and upload functions (typically used by the high tech suppliers). VendorNet system-to-system integration is achieved through a variety of file format options including: fixed-width, CSV, XML, EDI, and EDI-INT. VendorNet s built-in mapping utility enables online connectivity to any supplier s system eliminating programming at the supplier s location, and enabling rapid supplier implementations. In summary, VendorNet provides real-time visibility and control over dropship order transactions, allowing retailers and dropship suppliers to improve order fulfillment performance and cut costs. Benefits: Eliminates significant labor costs associated with distributing orders to suppliers, receiving manual order acknowledgements, processing ship confirmations, and manually approving and entering invoices for payment Improves customer service by reducing order cycle times, and increasing the speed of order delivery Improves customer service through enhanced order status visibility Enables faster revenue recognition through shortened billing cycles Improves dropship supplier relations through improved communications Facilitates online reporting and supplier performance analysis Delivers more opportunity to increase sales quickly and easily by expanding dropship product lines with no inventory overhead Copyright 2010, VendorNet Page 2

3 VendorNet Dropship Manager Illustration Retailer Dropship Orders (Consumers/Businesses) Supplier Destination New Orders Manufacturer Order Management System Financial Management System Order Acks/ETA s Shipments Matched Invoices V E N D O R N E T Distributor Fulfillment House Retailer Consumer Warehouse Store Copyright 2010, VendorNet Page 3

4 Functional Overview Sending Orders to Suppliers VendorNet transmits orders to suppliers via the Internet, eliminating the manual process of printing purchase orders/packing slips and mailing/faxing those documents to suppliers. As orders are passed into VendorNet from a retailer s order management system, VendorNet notifies suppliers via that they have new orders. From the , suppliers can hyperlink to the VendorNet website to retrieve and print the orders, or to extract the orders for uploading into a supplier s system. The VendorNet website is available to suppliers 24x7, providing maximum accessibility and visibility to orders. Printing Orders VendorNet allows suppliers to print packing slips and/or purchase orders locally. Retailers can customize packing slips by supplier and/or company, division, source code and ship method of the order. For example, packing slips can be unique to a specific supplier to provide customized shipping labels and return instructions to direct exchanges or returns directly back to the supplier. The packing slips contain all pertinent order information including: buyer, ship-to, product number, description, price, line item customization, gift comments, customer telephone number, etcetera. Figure 1 shows sample packing slip that can be customized for each supplier. Copyright 2010, VendorNet Page 4

5 Extracting Orders For those suppliers who have the capability of uploading order details into a distribution/order management system, VendorNet offers the ability to download the order files from the VendorNet web page in fixed-width, CSV, XML or EDI format. This eliminates the need for suppliers to manually re-key order data into their systems from the hard copy purchase order or packing slip forms. VendorNet accommodates supplier s file layouts as they exist it does not require suppliers to conform to VendorNet. Acknowledging Orders Upon review of the order, the supplier acknowledges it and confirms their ability to fulfill the order based on the costs, quantities, and required dates for each line item. Purchase orders that are accepted and acknowledged as is with no changes by the supplier are automatically sent to the Pending Shipment bucket in VendorNet. Buyers have the option of being notified by when suppliers have formally acknowledged orders with no changes. Should a supplier need to request modifications to the order based on the order quantities or delivery dates on the order, the supplier can initiate them via the VendorNet web portal. Order change requests made by the supplier are automatically sent back to the buyer for review and approval. This can be an iterative process based on order comments and order changes going back and forth. If the buyer accepts the order edits, the order is sent back to the supplier to proceed with fulfillment of the order. If the buyer rejects or further modifies the order, it will be sent back to the supplier for review and acknowledgement. If the supplier has a distribution system of their own, VendorNet can accept a file of PO acknowledgements and will update the purchase orders with the vendor s fulfillment commitments for review by the buyer. This stage of the PO exchange process allows buyers and suppliers to solidify PO product quantity, cost and delivery time frame commitments online. It also allows you and your supplier to maintain an audit trail of all PO modifications made. Once order change requests are flagged as approved, VendorNet allows a supplier to re-print the finalized order. If a supplier has their own distribution system that can accept a direct import of the purchase orders, the supplier can also extract a finalized PO file at this time. VendorNet also updates the retailer s host ERP system with final order modifications including changes to quantities or delivery dates. Shipping VendorNet allows suppliers to ship orders individually or by file through a browser-based web page. When suppliers complete the shipping process, VendorNet automatically updates the orders in the retailer s host system as shipped and generates an order action reflecting the date, actual ship method used, and tracking number for the order. VendorNet also allows suppliers to partial ship and add multiple packages per line item when needed. These details are also posted to the retailer s host system. Suppliers have many options for communicating ship confirmations back to the retailer. Ultimately, the supplier s current systems and business processes will dictate how the shipping process will be configured in VendorNet. Shipping by File Suppliers can upload a file of orders to the VendorNet web page directly from their distribution systems and/or shipping stations and VendorNet will process that file back to the retailer s order management system. Supplier specific shipping file formats are accommodated through VendorNet s library of file formats and mapping utility. Copyright 2010, VendorNet Page 5

6 Shipping online in Batch Suppliers can view and flag orders for ship confirmation via the VendorNet website in batch mode. Problem/exception orders can be marked individually to skip the ship confirmation process within a batch. Shipping online by Order This is the most popular method of shipping for lower tech suppliers. Via a web page interface, VendorNet supports shipping by individual order, prompting the supplier for shipping information including the actual ship method used, shipment tracking numbers, and freight charges. Shipping by Line Item Suppliers can also ship at the line item level and split order quantities when unable to ship the order complete. VendorNet leaves the remaining items unshipped and splits the order level in the retailer s host system to allow for immediate customer billing and order tracking. Add a package VendorNet allows suppliers to ship a line item in multiple boxes and will update the retailer s host system with the individual tracking numbers and freight charges associated with each box. Carrier Integration VendorNet is integrated with FedEx and UPS to streamline shipping functions with these carriers. Additionally, VendorNet provides links directly to most common carriers to enable easy online tracking of shipments. VendorNet FedEx Integration VendorNet and FedEx are tightly integrated through the FedEx Ship Manager Server (FSMS) network shipping solution. VendorNet is a FedEx Certified Solutions Provider (CSP) with FSMS version VendorNet communicates with the FedEx Server to verify delivery commitment to the recipient s address for the service level/ship method on the order, to obtain tracking and routing information, to ship the order, and to perform end-of-day Close functions. Features Produces a packing slip that includes an approved FedEx shipping label (Figure 2) Uploads daily shipping information to FedEx automatically Distributes FedEx end-of-day reports to vendors via Establishes pending bucket for shipped orders waiting carrier confirmation of package pickup Holds invoices until ship confirmed by FedEx via priority track interface Creates new bucket to review orders with FedEx Server/Carrier Errors Invokes business rules logic via scripts tied to FedEx Server/Carrier Errors (e.g. automatically upgrading the service level of a shipment when the current service level is invalid for the recipient s destination) Copyright 2010, VendorNet Page 6

7 Sample FedEx Packing Slip/Shipping Label VendorNet UPS Integration VendorNet is a UPS-ready partner providing full compatibility with UPS shipping functions. The logic to support UPS shipments is integrated within the VendorNet application backbone to streamline operational shipping processes for the vendor, and to ensure complete visibility at the retailer level. Features Produces an integrated shipping document containing a UPS approved shipping label and packing slip (Figure 3) Eliminates packing slip and shipping label matching Uploads electronic manifest to UPS.com Generates the UPS Pickup Summary Barcode for UPS drivers, which eliminates scanning of each package Supports prepaid or third-party billing based on retailer s requirements Holds invoices until ship confirmed Copyright 2010, VendorNet Page 7

8 Sample UPS Packing Slip/Shipping Label Regardless of the method or carrier used to ship an order, the shipment details are maintained in VendorNet, and updated in the host order management system. As a result, customer service representatives always have timely and accurate shipping information regarding dropship orders. Copyright 2010, VendorNet Page 8

9 Invoicing VendorNet allows suppliers to generate dropship order invoices to retailers online. These invoices are pre-screened for cost accuracy and freight tolerances, and automatically uploaded into the retailer s Accounts Payable (AP) system -- eliminating the need for manual dropship invoice entry and approval. Suppliers can invoice by individual order, group of orders, by file, or by individual line items on an order. Optionally, invoices can be entered during the shipping process, or as a standalone process subsequent to shipping. Invoices are posted and maintained in VendorNet for access by retailers and suppliers at all times. Using supplier-specific cost tolerance checks before posting, suppliers can optionally update costs. For example, a supplier may carry products that have variable cost components that are not determined until the supplier assembles the product. The option to update costs is controlled at the supplier level within the established tolerance checks. This option gives the supplier flexibility without burdening the retailer with approval processes that could potentially delay shipment to the customer. Handling Fees VendorNet can add handling fees to the supplier s invoices based on individual retailer/supplier agreements. Handling fees can be set at the order level, shipment level, product quantity level or package level. Additionally, retailers can control whether suppliers can override these handling fees. VendorNet then automatically adds the handling fee to the total invoice and posts it to the retailer s AP system as a separate line item. Ultimately, VendorNet s invoicing module eliminates a significant amount of manual review and processing in the accounting department to confirm the shipment of orders, entering invoices, and approving costs prior to payment processing. Additionally, all cost changes that are made within the preset tolerances are updated on the orders in the retailer s host system to provide accurate product cost and gross margin financial reporting. Copyright 2010, VendorNet Page 9

10 Online Production Reports Retailers and suppliers have the ability to view all orders and their statuses at any time from a web browser. VendorNet s Aging Views provide bar graphs depicting the age of orders not yet printed, not yet shipped, and/or not yet invoiced by supplier. VendorNet s ThruPut Views provide visibility to supplier performance including orders printed, shipped, and invoiced by day. Additionally, online detail reports on shipments, invoices, cancels, etcetera can be generated with various select and sort options. Sample Aging View Orders Pending Shipment Sample Sales Audit Report Copyright 2010, VendorNet Page 10

11 Online Supplier Performance Reports Since order data and delivery times are being maintained in VendorNet, the system provides instant access to supplier performance metrics. For example, the average time it takes a supplier to fulfill orders can be reviewed on demand. This can be evaluated over various time periods to spot supplier performance trends that may warrant follow-up. Retailers can also define Lead Days (or agreed upon fulfillment days) by supplier to identify exception order transactions that are falling outside the agreed upon delivery window. Performance reports provide business-critical visibility to potential problems allowing retailers to be proactive from a business and customer perspective. Sample Vendor Performance Reports Copyright 2010, VendorNet Page 11

12 Customer Service/Order Exception Processing Cancellations initiated by the supplier - When suppliers are unable to ship an order, they have the ability to cancel the order or line item in VendorNet, which in turn will send orders to a Pending Cancel bucket for review by the retailer. At that time, the cancellation can be approved by the retailer, which facilitates an update to the host system. Optionally, suppliers can be set-up to have cancellations directly update the retailer s host system without stopping at the Pending Cancel bucket. Cancellations initiated by your customers - When a customer initiates a dropship item cancellation through a retailer s call center or via the web, VendorNet will send notification to the supplier that the customer has requested an item/order cancellation. This stop shipment request is sent to the supplier for review and response. If the supplier is able to stop shipment, they can proceed with canceling the order on VendorNet. Otherwise, the supplier would respond that they were unable to stop the shipment. In either case, a positive or negative confirmation is sent back to the retailer. These cancellation processes can be controlled and customized for each supplier. Estimated Ship Dates - Suppliers have the ability to communicate anticipated ship dates on dropship items that are delayed or backordered. Suppliers can update orders in VendorNet on an individual order basis, by product, by quantity, or by file. For example, a supplier may have 1,000 orders for a product, but can only ship 100 units now and the balance in 30 days. The supplier can update VendorNet with the anticipated ship date for the product and quantity, and VendorNet will automatically find and update the affected orders with the anticipated shipping information. Dropship vendor anticipated ship dates are passed back to the retailer s host order management system for visibility in Customer Service. Order Comments - Suppliers can communicate with the retailer through various comment entry utilities. Comments regarding the status of a shipment, item cancellations, special circumstances, etcetera can now be logged or flagged for immediate review by the retailer and/or supplier. System Administration & Security VendorNet provides various system controls and management tools to ensure that communications with suppliers is flowing smoothly. VendorNet generates automatic notifications to the retailer and supplier if a supplier has been delinquent (i.e. they haven t printed orders within X hours, or they haven t shipped orders within X hours or days of the agreed upon fulfillment window). VendorNet provides security at the program function level allowing different users at the retailer s and supplier locations to have controlled access to the system. All program functions have security levels to read-only vs. update. The implementation of VendorNet s dropship order management modules will result in faster order cycle times, improved service and communications to customers, reduced paper handling costs, the elimination of errors due to redundant data entry by suppliers, faster billing cycles, and streamlined, paper-free dropship invoice processing. Copyright 2010, VendorNet Page 12

13 Implementation Architecture The VendorNet System has been developed on Windows/SQL Server. The VendorNet application is exposed to the web for managing the data exchange process with suppliers. The VendorNet application allows suppliers to access and update their orders and items through the web page interface, or by uploading files to the web pages eliminating long-distance dial-up phone charges or the complexity and expense of traditional VAN services. The VendorNet system offers multiple levels of supplier communications that can be tailored uniquely to each supplier. For low-tech suppliers, VendorNet offers functional web pages for accessing and updating orders. Order retrieval, order acknowledgement, shipping, invoicing, order cancellations, and various other customer service functions can all be performed by the supplier directly on the VendorNet website. All actions are tracked and updated back to the retailer s host system for immediate visibility. For medium to large suppliers, VendorNet offers standardized interface points and data files that can be used to facilitate communications. If a supplier has an existing order management or distributor system that includes an import/export facility, an application-level file exchange can be implemented via XML, fixed-width, CSV or EDI file formats. There is significant flexibility in VendorNet s built-in mapping utility to achieve application-level data exchange capabilities. VendorNet Technology Components: Platform/Operating System Windows 2000 or 2003 Server Database SQL Server 2000 or 2005 Application Business Logic Visual Basic.Net, ASP/ASP.Net, C++, JavaScript User Interface ASP/ASP.Net Host System Data Exchange XML, TCP-IP or FTP VendorNet can host the VendorNet application, or the retailer can host the application. If retailer hosted, the IT Environment requires the following: VendorNet running on a Windows 2000 or 2003 (32- or 64-bit) server with a minimum of IIS 5.0 and version 2.0 of the.net framework Access from the IIS Server to a Microsoft SQL Server 2000 or 2005 database server Access from the IIS Server to an SMTP relay (Optional) The IIS Server may have an SSL certificate installed for encrypted data communications (Optional) The application and database servers may be protected by a Firewall to control IP access to the servers. Additionally, the VendorNet product suite has its own security layer. Supplier s IT Environment requires the following: PC with Internet access Microsoft Word 2000 (or newer) or Adobe Acrobat Writer Printer Note: There are no software or start-up costs to suppliers for implementing VendorNet. Copyright 2010, VendorNet Page 13

14 Summary A tremendous opportunity exists to leverage supplier inventories in order to expand marketshare and increase sales, while at the same time lowering risk and upfront inventory investments. Through VendorNet, the technologically unsophisticated suppliers now have a viable and cost-effective means of electronically linking their inventories with a retailer s and retailers now have the systems to gain complete visibility and confidence in a supplier s ability to deliver products direct to the customer. VendorNet is firmly committed to delivering an affordable and continually expanding set of supplier management products by combining new technologies with operational-level business process expertise. VendorNet s goal is to provide all the tools necessary to link business partners electronically for faster and more efficient business operations, and streamlined supply chain collaboration. Complementary VendorNet Modules: VendorNet Stock PO Module facilitates online stock purchase order exchanges, acknowledgements, advanced shipment notifications, 3-way invoicing matching, and more between retailers and suppliers. VendorNet Inventory Manager Module provides online visibility to supplier inventory levels. Dropship inventory levels can be integrated with the retailer s host order management system to augment service center information, and provide an intelligence base for business planning and forecasting. VendorNet Product Manager Module (in development) allows suppliers to add and update product data information triggering an online review and an automated update process from your suppliers. This module also enables suppliers to enter/upload dropship inventory levels for visibility in Order Entry, Customer Service and the Web. VendorNet Returns Manager Module (in development) allows suppliers to process dropship order returns online via VendorNet for return/exchange processing and inventory credits. VendorNet Sales Manager Module (in development) provides online visibility to suppliers of product sales data in order to track/measure actual sales performance against projections, enabling suppliers to proactively manage inventory levels. Copyright 2010, VendorNet Page 14