This page builds on the previous Scenario page.

The key factor in any successful business is to find good customers, then retain them for many years through the delivery of positive and responsive customer service.  But really successful working relationships are never one-sided - it is about recognising each other's business objectives and needs, and about the ease of doing business with each other. 

Obviously, there are special business relationships where the Customer is so large and dominant that the Supplier will comply with all of their customer's wishes regarding how they would prefer to trade electronically.  This section is more about the next level down where neither party is dominant to any great extent.  For convenience, we will only relate to Orders and Invoices and not to supplementary documents, and avoid any discussion on negotiated price adjustments for one party helping to reduce the costs of the other party.

The following table sets out in a very broad cost sense who "wins" and who "loses" in most trading relationships:

DOCUMENT

METHOD

CUSTOMER SUPPLIER COMMENTS
Customer Order Fax Lose Lose Customer incurs fax and labour costs, Supplier has re-keying cost.
  EDI VAN Lose Win Customer incurs transaction fees. Supplier saves re-keying if there is integration.
  Direct Win Win Integration eliminates re-keying at Supplier end and there are no transaction fees.
Supplier Invoice Mail/Email Lose Lose Customer has re-keying cost. Supplier incurs mailing and labour costs.
  EDI VAN Win Lose Customer saves re-keying if there is integration. Supplier incurs transaction fees.
  Direct Win Win Integration eliminates re-keying at Customer end and there are no transaction fees.

 
 

Attaining close to cost equilibrium in a trading relationship can only occur if there is a like-minded approach from both parties.  Consider the following:

  • Many Suppliers are still reluctant to pressure their Customers for fear of upsetting them, although this is gradually changing through methods such as offering electronic invoices as an enticement to obtain electronic Orders.  It's the old rule in action - you have to give something to get something in return.

  • Exactly the same situation also occurs in reverse - some dominant Customers have pushed for electronic Invoices and are offering electronic Orders as an enticement in some cases.  It's all about balancing the relationship.

  • Most Suppliers have a Customer profile of 80% of their business coming through 20% of their customers and 20% through 80%, but that 80% is a very high cost area that can no longer be ignored as a 'given' cost of doing business.  Even a lot of the top 20% of business is still conducted by fax. 

  • An increasing number of Companies are becoming aware of the benefits of direct electronic trading and there is a cultural shift gaining momentum in those Companies that still use faxing, because with EZYB2B there is now a pathway to integrate electronic documents into back-end systems as small as MYOB and Sybiz etc.
 
 

Due to the increasing external and internal costs of doing business, the 'convenient' and often more costly options of sending faxes or using an EDI VAN are being questioned in many Companies.  Because of this it is an absolutely inescapable fact that both Suppliers and Customers will receive an increasing number of requests from their respective trading partners to establish direct trading, as many are already. 

It is always far better to take the initiative if you want to increase your adoption of electronic trading because you can control the timing and therefore utilisation of your scarce resources.  

EZYB2B is the EDI-enabler that will help you effectively and rapidly accede to any requests you might receive from your trading partners - you will no longer have to wait nor pay extra, you have the software and will be in control.