What is fcB2B and why should my company participate?
There have been many articles written and interviews given about fcB2B over the years, but I still run into people that aren’t familiar with it. This article will explain what it is and how it can benefit your company, no matter if you are a manufacturer, distributor, or retailer. fcB2B stands for Floor Covering Business to Business and in its simplest definition is a process to provide business critical documents in an electronic format. If you’re thinking that you already do this by sending documents via email or downloading them from a website, you’re close. These processes still require human interaction to complete the process and are error prone. The email could get sent to the wrong person, get stopped by a SPAM filter, requires someone to open the email attachment and do something.
Let’s take the first document and review from a manufacturer’s perspective. The product catalog is generated for your customer and contains the products and prices that they are allowed to purchase. This is generated from the information already stored in your system and provided to your customer, in most cases automatically because someone updated the information via an existing process. Your customer, using a process that supports the fcB2B standard, retrieves the information and updates their system with the changes. Why is this important? In some cases, your customers are also dealing with a reduced staff and looking for ways to do more with less. Let’s put this into perspective, if your customer bought from 5 different suppliers and each supplier had 100 styles with 2 sizes in each style and 10 colors in each size, that’s around 10000 items that would need to be updated for each price change. Assuming it takes 30 seconds to update the price on 1 item, that’s 5000 minutes, or 83.33 hours. If those 5 suppliers are using fcB2B that 83.33 hours turns into maybe an hour to retrieve prices and update their system. Your customer is now much more efficient and more likely to encourage the sale of your products.
From a distributor’s perspective, your customers are also happy with you because they can now import the products. they purchase from you quickly and efficiently. You also have the added benefit of using fcB2B with your suppliers and automating processes on your side. You can submit PO’s and get PO acknowledgements. You can get notifications of shipments and automate the receiving process. You can also get your invoices electronically. Not only are you helping your customers be more efficient, but you are also benefiting from the automation that fcB2B allows.
As a retailer you have already seen how the product catalog can provide efficiencies by reducing the time delay in getting your prices updated. What other efficiencies can you gain? What about submitting POs to your suppliers? Do you currently enter the POs into each suppliers website or call customer service to get the order entered? Imagine taking those PO’s that already exist in your system and pushing a button to have them sent electronically to your suppliers and getting the reference number and status automatically updated in your system. How much time would that save you a day or week? How about your sales staff being able to check stock on a product instantly while talking with a customer and not having to visit a website or call customer service? What about having the status of orders updated in your system without having to call or visit multiple websites and then manually update your system. Imagine the possibilities and how efficient you could become by using technology.
Fcb2B provides specifications to generate Price / Product Catalogs; receive PO’s and return PO acknowledgements; send Advance Shipping Notices (electronic BOL) and invoices. We also have specifications that allow for instant Price Checks, Stock Checks, placing Reservations on stock, instant Order status updates, and seeing what items may be related to a product being sold.
Visit our website at www.fcb2b.info and click on the Resources tab to learn more about fcB2B. The Organization tab has a listing of the members that support fcB2B.
Do you B2B? If not, why? Contact me to find out how to be more efficient in your business.
What’s in it for me?
I get this question quite often when talking with suppliers about fcB2B. For the retailers, there are plenty of efficiency opportunities to be found when using fcB2B. A few are listed below.
- Automating price updates via the product catalog
- Price check to ensure the current price is correct
- Checking for available stock
- Reserving stock for an order
- Placing the order electronically
- Receiving the order confirmation
- Checking order status
- Receiving the ship notice to facilitate receiving
- Receiving the invoice for 3-way match
However, suppliers typically see fcB2B as a cost. They fail to see the long-term savings and efficiencies they can get by implementing fcB2B with their customers. The suppliers can save money on printing and postage for price catalogs and invoices. Efficiencies come from reallocating of resources from phone calls to other important functions. Most suppliers have websites that allow these same functions but fail to think how inefficient that is for their customers.
As a retailer who orders from 5 suppliers, not utilizing B2B, they potentially have 5 different web sites they must log into and navigate to place an order. If the supplier doesn’t provide a web site with these functions then the retailer must find and potentially call multiple times, confirming the current price, finding out if stock is available, placing a reserve and then finally calling back to place an order. This takes time for the retailer and for customer service to perform these checks. With most Flooring Management systems these functions are built in. This allows the retailer to remain in one system and become much more efficient.
Suppliers that implement B2B can benefit from fewer claims associated with incorrect orders being entered; fewer complaints from customers that haven’t received the latest price update in a timely manner to get their system and store updated; fewer calls to check stock, place reservations and checking the status of orders. As more and more retailers see the benefits of using B2B, they demand B2B of their suppliers. Suppliers that have B2B may notice an increase in orders. This could be because the retailers find it easier and faster to place an order via B2B than placing it via web or phone.
Suppliers, if you are already doing business with the big box stores, then you are probably already using X12 EDI with them per their requirements. fcB2B utilizes the language of X12 EDI and it has been used by retailers in the flooring industry for over 15 years. B2B allows retailers to become more efficient, profitable and they may even try a little harder to sell your product compared to a competitor who doesn’t support fcB2B.
So back to the supplier’s question “What’s in it for me?”. More efficiency; fewer claims for wrong products, quantity or price on the order; and best of all, potentially more sales from happy customers. Are you a manufacturer, distributor, or retailer that’s curious about how fcB2B can help, but don’t know where to start? Contact me at email@example.com or 706-217-1183 x 132, and we’ll set a time to talk you through the steps. Be sure to check out the website, to start the learning process, at www.fcb2b.org.
Do you fully use fcB2B?
Do you utilize the full process that fcB2B provides? What do you mean, you may ask? Are you a retailer that is only receiving the product catalog? I am sure you see the benefit of keeping your prices and products updated automatically, but what about PO’s, receiving and invoices. Were you aware that there is an average of 1 to 2 percent error rate when placing orders manually? What do errors cost your business and what if you could reduce that percentage by entering the order once and submitting it electronically. Computers typically do a great job of processing exactly what they are provided. Whether you submit 1 order a day or 1000 a week you can still benefit from automating that process.
Now let us talk about receiving and how that process can be improved by using the Advance Ship Notice. Are you manually entering everything received into your system and then matching back to what was ordered? What if your computer already knew what was on the truck and could tell you what was ordered but not received? Your process of receiving could be reduced to verifying the product and determining where to location the inventory.
Now that the order has been placed and received are you waiting for the mail to deliver the invoices. Once you receive the invoices are you having to manually match the order to the receiving and the invoice to confirm everything ordered was received and invoiced. Imagine having the invoices in your system within 24 hours after the shipment was received and automatically matched to the PO and receiving. I have heard of a retailer that had one person spending 40 hours a week submitting PO’s and processing Invoices. After adding fcB2B to their process that one person was able to process PO’s and invoices in only a few hours a week and assist with other processes. If you are currently using one of the flooring specific software packages, check with support to see about adding fcB2B to your setup. Not using a flooring specific software package but still interested in benefiting from fcB2B? Contact Lewis Davis at firstname.lastname@example.org and discuss options you have for your current setup.
Do you suffer from SAOD?
Do you suffer from Severe Acronym Overload Disorder or SAOD? I know I do on some days. If you read through any of the trade magazines you may have been affected at one time. Thank goodness, we have Google to help identify what each acronym means.
fcB2B has a long list of numbers and acronyms that mean something. If you listen to members at our meetings talk, you might think they are part of a secret government agency. “I sent an 850 to you but you didn’t send me an 855 or an 856. What about the 997?” All of these numbers indicate a different electronic document. Let’s look at the acronyms and numbers used within the fcB2B language so we can eliminate a little of your SAOD.
Let’s start at the beginning and work our way through the fcB2B alphabet.
fcB2B – This stands for Floor Covering Business to Business and is the group that manages the standards and helps suppliers become fcB2B compliant.
WS – Web service is a connection to a supplier’s computer that allows a software package to ask a question and get an answer in near real-time. The web services that fcB2B have defined are Stock Check, Order Status, and Price Check. New services in process or being reviewed include Reservation and fcB2B setup request and response. The Reservation Service will allow the reservation of a product in the supplier’s system electronically. The fcB2B setup request and response would standardize the process for a company new to fcB2B to request setup with their supplier.
FTP or SFTP – File Transfer Protocol or Secure File Transfer Protocol is the communication method used by fcB2B to send and receive documents between the retailer and supplier. This is a direct connection and eliminates any third-party charges for managing the connections.
EDI – Electronic Data Interchange is the computer to computer exchange of business documents in a standard format.
X12 – Is chartered by the American National Standards Institute (ANSI) for more than 40 years. It develops and maintains EDI standards to drive business processes globally. fcB2B uses the X12 EDI standard to define the Price Catalog, PO/PO Acknowledgment, Advanced Ship Notice and Invoice.
832 – This is the X12 number for the Product Catalog. This is the electronic document sent by suppliers with product and price information used to load and maintain flooring software.
850 – Electronic Purchase Order generated by flooring software and processed by suppliers. This provides suppliers with the information required to generate an order.
855 – Electronic PO confirmation sent by the supplier after receiving an 850. This is a confirmation that the order was processed and contains values indicating either success or failure when processing the PO.
856 – Advance Ship Notice or ASN. Think of this as a detailed electronic bill of lading from the supplier. This contains the quantity, product, PO number, ship to and from, and other information needed to receive in the shipment.
810 – The electronic invoice is the final document in the fcB2B bag. This allows the retailer to receive a copy of the invoice and the flooring software to match what was ordered, received and invoiced. This completes the 3-way match and ensures the retailer isn’t missing any product and wasn’t billed incorrectly. 997 – This is a functional acknowledgment which is automatically generated and returned for every document sent. This ensures that when sending an X12 document, the receiving party receives it and it wasn’t lost in space. The document can convey the status of the received document and any errors found in the original document.
Why should the fcB2B provide certification? Without some type of validation process the B2B documents that are being passed between suppliers, distributors and retailers will continue to be inconsistent. Certification has been attempted multiple times in the fcB2B groups existence. In the past there wasn’t an independent entity to perform the certification. There also wasn’t a defined process for how certification happened.
The fcB2B group has now defined a certification process and will act as the independent entity. The certification process was approved at the annual meeting in October. A tool to perform the validation is currently being researched. The fcB2B group requested when approving the certification process that the tool be available for self-testing prior to starting the certification process.
Certification will only be performed on the latest version of documents which currently is version 3.0 and at the present will not certify web services. The web services validation process is still being reviewed so a process can be defined. The certification process as defined, will validate both the senders process and the receivers process. This will ensure that all parties are compliant, and the data being processed is consistent. We hear quite often that one supplier sends information differently then other suppliers and this either causes extra work for the software providers or problems for the receiver of the information. This has mostly been because of how companies interpreted the original standards. The new version of the documents are much clearer and eliminates the ambiguity in the interpretation. With certification we can ensure that the standards are being interpreted the same across the industry. Once a company completes certification the company and the approved document(s) will be identified on the fcB2B website with a marker indicating they are certified. This certification process will remain in effect for a timeframe or until changes occur that require recertification. The retailers will then be able to view the suppliers and software providers and know who has gone through the certification process. You can feel comfortable that the data being passed between the suppliers and software providers is good. The process also validates that if bad information does get sent that the receiver will handle it correctly and not populate bad information in your system to cause you problems. The certification list will also allow you to see what documents a supplier or software provider are able to transact. This allows for informed decisions when selecting your next flooring software provider.
My Supplier isn’t on B2B!
As a retailer who uses fcB2B, you understand the benefits and cost savings it provides. Some benefits include checking stock in real time without leaving your customer, verifying the current price of a product, reserving stock to ensure your orders are filled, and submitting orders electronically. Imagine having all your suppliers using B2B instead of just a few. You would be a master of productivity. Instead, you probably only have a few suppliers utilizing fcB2B. Others require extra work on your part to keep prices updated and time to manually key PO’s in their website or call the order desk to place the order. Then you wait for the paper invoices to arrive in the mail. With the current health crisis and possible reduced staffing levels, automating these tasks is more important than ever.
Why doesn’t fcB2B get these suppliers involved with B2B to make your life easier? We have a list of suppliers that we contact that are currently not part of fcB2B and encourage them to join. The problem we run into is that they look at us as a fly at the picnic. Just spitting out buzz words and wanting them to implement B2B. Suppliers listen to their customers more than they do the fcB2B group. If we work together, then our combined voice can make a difference.
What can you do to help fcB2B help you? To start with, fcB2B has a short video that explains the benefits of B2B from the retailer’s perspective. We had several requests from retailers to provide information that would help explain what fcB2B is for sales reps. This video is front and center on our website. Send your reps to the site and have them spend less than 2 minutes reviewing the video. We also created a form letter that explains the benefits for both the retailer and the supplier. Download the form from the website, add your company info and send it to your suppliers you want on B2B.
The Retailer letter for a supplier can be found on the Resources tab or by clicking here. This is a Google letter that you can download and add your company information. Then, send it to your suppliers. Are you a manufacturer, distributor, or retailer that’s interested in making your business transactions electronic, but don’t know where to start? Drop me an email at email@example.com, and we’ll set a time to talk you through the steps.
What is EDI and why is it used by fcB2B?
What is EDI or Electronic Data Interchange? Let us start with a little history, back in the early 1970’s companies were looking at ways to communicate business documents in an automated fashion. Back then communication was done using modems (precursor to todays routers). Companies like Montgomery Ward and Kmart defined their own format to send purchase orders to their suppliers. This was great if you were the sender, but each supplier had to support multiple formats to be able to process PO’s. This was very inefficient and costly for the suppliers. The industry came together and requested help from the American National Standards Institute (ANSI) and after a period, EDI was born. At the time that the fcB2B standards were created, EDI was well established and heavily used within supply chain. This made the decision on the format very easy.
The EDI documents are rather cryptic if you are not familiar with the format. Each document has a number that identifies what information is contained within. The 810 is an electronic invoice whereas the 832 is a product catalog. Each document is broken down into segments and elements. The elements define what data is stored and qualifiers are used to further identify the data. X12 EDI is used throughout the United States where as EDIFACT is the standard used in the rest of the world. Although they differ in context and document name, a Purchase Order is an 850 in X12 and ORDERS in EDIFACT, both still use segments, elements, and qualifiers to identify the data being sent.
I know this is techno speak but it helps to explain why EDI was used to create the fcB2B standard. In today’s IT and in life, things move much faster, and we have gotten accustomed to instant access and instant delivery. One question I get is why are we still using EDI to send these critical documents, why not a newer technology or web services to request a catalog and receive the data. One reason is the volume of data in a complete catalog from some suppliers, although small compared to some files on the internet. Another reason is the investment suppliers have made in EDI which is still required by large retailers to conduct business. The big online retailers (Amazon, Wayfair, etc.) are looking to EDI to provide stock levels to keep products on a website and supplier analytics. There are other options for sending this type of information but they would require additional effort to define and get industry agreement. EDI may be getting some gray hairs but it’s still useful and still has a role in automating business critical documents.
Visit our website at www.fcb2b.info and click on the Resources tab to learn more about fcB2B. The Organization tab has a listing of the members that support fcB2B.
Do you B2B? If not, Why? Contact me to find out how to be more efficient in your business. Lewis Davis can be contacted at 706-217-1183 ext. 132 or via email at firstname.lastname@example.org.