Over the last several months I've noticed a growing interest in more partners connecting to Grocery Retailers than I have in the past, specifically around NEX/DEX. I'm not sure if these are new partners or if Grocery Retailers are now looking to expand their connections for DSD (Direct Store Delivery) orders through electronic trading but it seems like a good time to educate you on this system. ways that trading can be done, and alternatives to NEX.
Prior to the rise in EDI being traded for Direct Store Delivery orders, either through regulatory requirements, getting software in place, or agreement between larger partners, Grocery Chains implemented a Nex/Dex electronic trading system. As you can tell by the name, there are two methods for trading data through the Nex/Dex system -
The distributor’s system and retailer’s system exchange information, making any adjustments for discrepancies in quantity or price. After all data is reconciled, the DSD distributor/supplier then transmits the digital invoice directly into the retailer’s system.
The NEX communication process is typically initiated when the retailer submits an order to the DSD distributor/supplier (This can be through an EDI transaction [875 or 850], fax, phone or email) outside of the NEX/DEX system process. The distributor/supplier confirms the request and replies with an invoice directly to the Grocery Retailer using an 894 EDI transaction through the VAN (or direct connect) representing what the supplier/distributor intends to deliver against that order (similar to an ASN for other delivery types). The 894 data is validated to the Retailers requirements and then passed on to the store's receiving (backdoor) system awaiting the delivery.
Depending on the Retailer and the supplier, the reconciliation process may include the retailer sending the 895 Acknowledging the approved invoice that was uploaded to the Retailer's AP system. It should be noted that though most Grocery Retailers support an 895, very few are requiring support of that by the suppliers. However that is one of the pushes I've seen with this growing initiative. Most retailers require that the 894 transmission be sent within 4 hours of the delivery being made.
As you can image, not that many suppliers/distributors have DEX systems to support this, nor can they, at the moment, support the 894 and 895. So as an alternative, I'd suggest that Grocery Retailers start looking at using the 856 ASN transaction for alerts of the future delivery. Below are some alternative order processes that could be considered -