October 18, 2005

Di Giorgio Corp. is the largest independent food wholesaler and distributor in the New York City metro area, and runs a division called White Rose Foods.

Di Giorgio describes its services as helping its customers grow profitably by providing efficient order processing, followed by tight, competitive pricing and fast service.

"We believe that by doing right for all our customers, we will do right for ourselves, our associates, our stakeholders and our suppliers."

Part of the efficiency White Rose is after comes from its open approach to electronic data interchange (EDI) implementation that has brought the company to near 100% compliance from its vendors.

According to Silvana Hendricks, EDI administrator for White Rose, "Nearly all our vendors are on EDI with us. Only those that are very small and just don't have the resources receive fax orders from us."

Nearly 900 vendors have come on board with White Rose since the company started implementing EDI about 10 years ago. However unlike most hubs that are the initiators of EDI with their trading partners, White Rose was encouraged to implement EDI by some of its larger customers including Proctor & Gamble and General Mills.

"These vendors were already using EDI and saw the efficiencies it was bringing to them. They pushed us to get started," explains Hendricks.

White Rose contacted Sterling Commerce and brought the company's Gentran Integration System in house. As soon as White Rose became comfortable with the efficiencies trading via EDI brought to its operations, the company sent letters to its suppliers.

"We wanted all our suppliers to convert from faxed orders to EDI as quickly as possible," says Hendricks. The company told its suppliers that they would incur a charge of $100 for every non-EDI invoice the vendor sent to White Rose. The vendors fell into line quickly, but those that were too small or didn't do enough business with White Rose received special consideration. Within the first year, White Rose had nearly 100% of its eligible vendors onboard with EDI.

The company's buyers are its biggest proponents of having its vendors comply with its EDI mandate. In the past, when orders were faxed to vendors, it was commonplace for vendors to explain to the buyers that they had not received the purchase order.

"It was just a convenient excuse vendors could use when they missed the ship date," says Hendricks. The buyers feel more confident with EDI in place because if there is ever a doubt about whether a purchase order was received, they simply call Hendricks who looks at the transaction log in her Gentran system. The increased accountability made possible by EDI has meant White Rose's buyers can place orders with confidence and expect their orders to progress without hitches.

A significant number of White Rose's vendors are relatively small companies that don't have the resources or desire to set up complete EDI systems in-house. Those companies have found that Internet based EDI services are economical options that don't require software and hardware, or specialized employees to manage the systems.

White Rose leaves the selection up to the individual vendor, but offers recommendations including Owens Direct, ADX, and GroceryEC. "Most of the time the recommendations come from the buyers when they are talking with their vendors. It's in their best interest to get their vendors on EDI, so they try to get them connected with the EDI service suppliers," says Hendricks.

White Rose processes more than 3,000 EDI documents each week. The bulk of the transactions are purchase orders and invoices, but the company is now processing advance ship notices as well.

Buyers create orders in the company's proprietary order system which are transferred to Gentran for transmission to its vendors. All transactions are routed through the Gentran system. As Hendricks puts it, "I really don't know which vendors are using what EDI system. I get one consolidated view of all the orders."

Transactions are processed 5 times each day, which keeps Hendricks busy and closely involved in the ongoing process.

The company is looking into the option of using AS2 to connect with its vendors but it has several other projects on the table that have higher priorities.

At near full compliance levels, Hendricks concludes, "We don't impose the $100 per invoice penalty any more. Our buyers simply let any new vendors know that if they are not EDI capable, they won't be able to receive our orders."

With the variety of low cost and easy to use options available, there is no reason potential White Rose vendors can't take orders.

Source: Line 56