Transformational IT Summit

May 25, 2022   |   9am PT   Register Now!

Ever-changing customer demand combined with unforeseen catastrophes such as the pandemic makes modern supply chain management more challenging than before. Companies must find ways to better manage their supplier network, expedite onboarding of new trading partners, and shorten and improve new product introduction cycles.

In this session we discuss how a modern, pre-connected EDI solution can dramatically improve your operations, allowing you to focus more on strategy and less on tactics. You’ll also learn how Chubbies, a leading apparel company stayed EDI compliant and eliminated infraction fees that were cutting into margins. 

Our panel of speakers sheds light on how moving from a managed EDI system to a modern, automated EDI system will:

  • Provide more control and visibility into transactions
  • Support faster onboarding of trading partners 
  • Improve partner-customer relations with fewer chargebacks & errors
  • Modernize, simplify, and future-proof your EDI infrastructure
Watch Now!
Full Webinar Transcript
Welcome, everyone, to our webinar today on EDI. We’re going to give everyone just a couple more minutes to join. Still looks like we’ve got a lot of attendees joining, so we’ll get started here in one more minute. Excellent. Okay. I think we’re going to get rolling here. Had a few more people join. So thank you, everybody. I’m really excited today for our webinar. And it’s focused on EDI and how to onboard new EDI trading partners in less than a month with Celigo and Orderful’s modern EDI solution. I am Mark Simon. I’m the VP of strategy here at Celigo. Just a little bit about me. I’ve been with Celigo for the last three years, but prior to that, I originally started out my career as a software engineer. So, really, sort of a tech person at heart. And that led me to being a co-founder and CTO of an e-commerce company, which we led through considerable growth before exiting and joining a consulting firm and then leading one of the larger practices in a mid-market ERP ecosystem for over 10 years. And through that process, worked with hundreds of clients, but a large number, a majority, over half of those, were products companies of some kind, whether e-commerce, some type of distribution company. And we really focused on digital transformation for them, new systems, automating their processes. And a consistent theme in that was EDI integration and the challenges that faced these growing companies. So excited to be able to share our solution here, which we think is really a game-changer for the space. And very excited to have Erik Kiser, the founder and CEO of Orderful, to talk to us today. Erik? Yeah. Thanks, Mark. Similar to Mark’s background, I’ve been working– or, I guess, probably a little different, I’ve been working EDI for the last 12 years, but I started my career as a consultant. I started by building EDI integrations, connecting manufacturers with their supply chain. So connecting them to retail, connecting them to suppliers, and then also logistics providers. So mostly enterprise-level experience. But as I’ve gone through this 12-year EDI journey, I’ve had a lot of exposure to the problems that SMBs and brands face as well. Over that time, I started my own consulting firm. And what we were doing was building EDI integrations for mid-market companies. We grew into a 50-person consulting company. We used all of the different major EDI providers out there as our partners to solve the EDI problem. And as I was building and starting to grow this business, I recognized that there was no EDI provider in the market that can bring supply chains together. And that was kind of the juncture and kind of sparked this idea that we could create a modern platform for EDI that can actually make it really easy for companies to trade and come together. Fantastic. Thanks, Erik. So we’ll jump in here and we’ll take a look at the agenda for today, so first thing we’ll do is we’ll jump in after this and talk a little bit more about Celigo and give everyone a little bit of background here that isn’t familiar. And I’ll hand it over to Erik to get more background about Orderful as a company, and then we’ll lead into why does EDI matter to modern businesses? What does the EDI landscape look like right now? What is a modern EDI solution and where are things headed? And then we’ll look at the Celigo and Orderful solution; how that works together to come as a combined single solution. I’ll take a look at our customer success story and then recap and leave some time for Q&A at the end. So on the Celigo side, who are we? Celigo, our goal as an organization is to enable companies to integrate; to bring integration and make it accessible to users throughout an organization, not just technical teams. And we foster and enable that by being an iPaaS platform, so what’s known as an integration platform as a service. So we’re a cloud-hosted integration solution. But we are the first of the next generation of iPaaS solutions, iPaaS 2.0, if you will. And what we bring to that integration space is a different approach than some of the legacy providers, and we bring ease of use and some very powerful pre-built solutions that we’ll talk about a little bit more of. But that combination is we strive to bring power with ease of use so you can have both in the platform, both enable developers and technical staff, as well as non-technical staff and build the most efficient muscle within your organization for driving digital transformation through automation and with the foundation of that being integration. So Celigo, we are a funded startup company, and we consider ourselves very lucky to have reached a milestone of 4,000 customers and we are almost hitting a seven billion records process monthly for our customers through the platform. And that’s a huge milestone for us and we’re really, really excited. I think about seven billion records are being processed. And that number is growing so quickly for us it dwarfs any type of spike around Black Friday, for example. And so it’s fabulous to have a cloud-native architected solution that can handle that type of growth. We have over 36,000 users that are actively using our system, interacting with it, building flows, building integrations and automating their business processes every day. As a company, we have– actually I think we broke the 500 employee threshold now and we have six global offices. And we’re growing very, very rapidly. If you look at some of the customer logos that we have in our organization, they really span the spectrum of both sides. So we have Fortune 500 companies that leverage the Celigo within their organization, a very large number of mid-market, and then down through small businesses as well. And we can provide value to that whole spectrum simply because of the value derived from our platform and some very flexible models. So our goal is to to bring and enable that integration, and gain those gains of efficiencies for as many businesses as possible. You don’t really have to take our word for it only. If you go out and take a look at what some of the leading peer insights and customer reviews, I’d say take a look at G2 Crowd. For example, we’ve been put in their top 50 products for cloud IT management this year. And very proud of that because we’re the highest ranking integration solution in that list. So a little bit more about our iPaaS platform itself. So as I mentioned earlier, really, our goal with that platform is to allow both IT and business teams. And this enables what we call– through that approach, this enables what we call a federated approach to integration. And that’s the leading practice that we recommend and that we’ve seen our most successful customers use. If you solely consolidate your integration build and development within, say, just an IT team or just the business systems team, you’re really not leveraging the value of automation like you could. And so by providing a platform that has reusability, has strong compliance and governance, has technical capabilities, but combined with that ease of use, you can use this federated model where you can enable departments– a marketing department, for example, an e-commerce team, any department in your organization who can build, manage, extend, modify flows, but they can do so under the guidance and coordination through a center of excellence within our organization, through an IT team. So it’s that pairing that really enables and unlocks digital transformation by being able to spread the engine and build that engine of automation throughout your organization. So we effect that by allowing you to integrate any business application. So we have built an extensive array of pre-built connectors for specific SaaS applications. But we can connect to any application through our universal connectors, through flat files, directly against databases, through an on-premise connector if you have a legacy on-premise system. That gives us that ability to automate and optimize the business processes with the platform. You can have that business logic inside. You can leverage code as needed to make as complex of a flow, or take a low code approach. And together, all of these it really accelerate digital transformation for your organization. And with that, over to you, Erik. All right. Thanks, Mark. So waterfall is a cloud API platform for EDI, and we’re powering global trade. So we’re a complete EDI platform. What happens is our customers connect once to our product via our API, and then they get access to our network, and any trading partner or anybody in their supply chain that they want to do business with then also gets added to our network. So as we bring on new accounts, we’re increasing the size of our network and everyone wins. We’ve been around for four years. We have over a thousand companies in the network. We’ve been able to grow our network pretty quickly with our text chat. It’s actually quite easy for us to add a new partner to the network, and right now it’s taking us about four hours to do this. So if you had a trading partner that hasn’t currently published in Orderfull, you make a trade request, we can get that done in a day or less. A little bit more about us, we’re a 30-person team. We’re backed by initialized capital managers. We just raised our Series B. I mean, we’re kind of entering into the growth phase of our journey. As you look at kind of the breakdown of our customers in the middle of the slide, the most kind of largest percentage of accounts that we do business with are brands. So these are CBG companies that are trying to trade with retailers or that need to enable integrations with their 3PLs. We also represent some really large enterprises. We actually represent the second-largest private company in the world in Koch Industries. They use our product to trade with their supply chain. And then we also help companies like other SaaS platforms and 3PLs with their EDI challenges as well. So really excited to kind of jump into EDI here. And Mark, if you want to just hit the next slide. So, yeah. So for those of you that are on this webinar that don’t know what EDI is. It’s the way that a company trades and integrates data with their supply chains. And this technology is a 60-year-old technology that predates the internet. And the way that EDI was originally leveraged was for the military to send really high-value payloads back and forth from Germany to America over simple telephone signals. So when you look at kind of the technology, it is extremely old. An example of a EDI transaction here is on the left. This is a fixed position file. It’s asterisk delimited. And you certainly need to be an expert to understand all of the different fields and qualifiers within this thing. So with that transaction, they’re also traded over different communication channels. So what’s expected of a brand is to build their own flat files and then set up their own communication channels and try to integrate with their trading partners with kind of this hodgepodge of solutions. What EDI looks like for a brand is typically a brand will have to integrate data with all of their retailers. So any retailer that you to you’ll have to integrate with, and these would be transactions like purchase orders and invoices and shipment notices, and then you’ll also integrate with 3PLs. So if you’re shipping through a third party logistics provider, you certainly want to integrate and automate that data because it’s typically high volume transactions. I mean, then as brand rosen to an enterprise, you can also go down market and integrate with suppliers. Hey, Erik. I remember the first time I worked on an EDI integration. It was almost 20– or, actually, it was more than 20 years ago, I’m scared to admit; it makes me feel pretty old. But I remember being told, “Well, yeah. This is the old way that things are being done. But it’s going to be replaced,” and at the time, hearing XML is going to replace this, and I think every few years we hear, “Hey, this is going to be replaced,” but I know from the customers that we work with that EDI is, it seems like, even more entrenched than ever. It’s simply the only way to do business. It doesn’t look like it’s really going anywhere, is it? It’s not going anywhere. And, yeah, the way that supply chains integrate data is the same today as it was 20 years ago when you saw it, so yeah. Certainly the norm for how to integrate data with your supply chain. And I think the reason for that is that everybody’s adopted it, so it’s something that everybody has been accustomed– every retailer has been accustomed to it to enforce, and then they can also– they can force their supply chains to trade the way they want them to trade and nobody’s really thought about how to make this problem go away. Everybody is just kind of solving for it in real time. Next slide. Cool, so yeah. So the challenge with EDI is it’s not just painful for the brands over here on the right, but it’s also really painful for the retailer on the left. What a brand has to do is actually build that flat file. So what that looks like is you have your system of record, like let’s say NetSuite. You then have to extract data out of that. You have to build some mappings. You have to then translate that mapping into a flat file that’s astro stimulated fixed position X12 example I gave you earlier. And then what you have to do is figure out how to communicate or send that transaction to your trading partners, and you’ll set up your own FTP, AS2, or others. And then on the other side, the retailer or trading partner has to do exactly the same thing. So the challenge with EDI has always been that both sides are kind of going at this with a custom solution. And a lot of the– a lot of the pain comes in actually coordinating and trying to get the big retailer to work with the small brand. It’s kind of a typical David and Goliath challenge. I mean, again, all of this onboarding and all of the building is done kind of in a custom way. I mean, it’s all done over email. It’s done with PDF files that describe how to integrate and how to build these flat files, so there’s even more complexity when it comes to actually executing the job, right? So a little bit about how does a brand– when is EDI important to a brand and kind of what’s the typical journey? For a brand, let’s take like a makeup company. Susie starts a makeup company. She starts selling to friends and family. She is selling out of a garage, kind of starts this idea phase, starts to get some semblance of an MVP, and some semblance of the fact that other people want to buy her makeup. Then she upgrades her business to a e-commerce site, maybe stands up Shopify starts selling to other consumers through e-commerce. And what happens here is the brand starts to experience markets, so maybe the market will take the product, or maybe it’s going to stay a stale product and not go anywhere, but if the market is taking the product and those product market fit, typically the brands will start moving away from their garage and into an actual 3PL. And this is when EDI comes up. This is when the first kind of– probably the first instance of needing to integrate or automate transactions actually becomes a reality for a brand. And then the second thing that happens is once the brand, the makeup company kind of matures, kind of taps out the e-commerce opportunity, they need to start selling through multiple channels. And that’s when the introduction of retail comes up and wholesale comes up. And that’s also when the next kind of influencer EDI pops up for a company. So there are these steps along the journey where EDI becomes a question, and it becomes kind of a requirement. A lot of companies will not take on the integration piece of this early, but we’ll talk about kind of why that’s important in the next slides. Yeah, I’ve definitely seen some of this inflection hit big companies. And use beauty as an example, I’ve definitely seen it in that sub vertical as well, where getting a lot of momentum, and then they land a key account. They get into maybe Altera support for the first time in there. It’s a huge win for them. And it’s okay if they’re going to be 100 stores. And kind of lost in all that is now there’s a big shift because now they have– there’s no option. They have to conduct business over EDI, and that imposes a lot of process requirements and big impact on the organization. And often a mad scramble because it hasn’t been thought through. And so definitely the need for speed has been– I’ve seen that consistently when they hit that trigger point. And get those key accounts that they need to move fast has been one of the biggest things I’ve seen. That happens fast, right? The product market fit is there. You go to a trade show, then boom. They’re picked up by Sephora. And next thing you know, you’ve added essentially 10 full-time jobs, but you’re not adding 10 full-time people. So it’s a mad dash to try to solve these problems. Cool. So really high level. When EDI matters for a brand is again, you grow into a 3PL. The next phase is you start selling at a wholesale, so doing B2B. You can also start selling through wholesale and dropship. So shipping directly to consumers through your wholesale partners’ websites. Other than last, this is more on the enterprise side, but when you can start integrating and automating or procure the payment processes. Yes. So when we talk about this journey, there’s definitely challenges along the way. We kind of alluded to part of the challenge, which is you hit this inflection point with retail. And they depend a lot out of the brand, but the brand doesn’t have the resources to actually execute against that demand. So I’ve put together a little timetable of, you know what, this looks like– and when you grow into a 3PL, probably less than 2 million in revenues, less than five people indefinitely developer. So the need to integrate with the ThreeCal’s really high, but you don’t have the resources to typically do it. When you sell into a wholesale like selling to a retailer, kind of same situation, definitely more revenue is what we see. Maybe now you have an ERP system. Maybe the team’s a little bigger, but there’s still no developer on-premise that can actually build these EDI integrations. When you start selling through wholesale and drop-shipping and starting to have a more complex business model, again, team size could be much larger than 15, but probably not bigger than 50 people, maybe 50 million in revenue; still, no developer. So kind of what you’re seeing in this journey is while all of these different stages happen for a business, there still has not been a need to hire somebody to build integrations for your business. Your focus on operating, selling– in the case of a makeup company, you focus on building new products, not focus on integrating and solving technical challenges for the business. Mark, you have any anything there? Yeah. I actually really love this slide. This is a great map to anyone building and growing a business that knows that EDI’s on the radar, but they maybe aren’t sure quite when. And I think this really helps because one of the biggest things you can do for any of this is prepare yourself; be thinking ahead, know when this is going to come, and it’s going to give you a lot more agility as a business leader to put yourself in a position where you have the right solution in place. You’re choosing the most flexible solution instead of just having essentially a crisis around EDI at some point and just grasping for a solution, which believe me, I’ve seen a lot of clients do over and over again and spend a lot of time. Myself and my team coming in and unwinding some bad decisions along the way of providers that aren’t working, that are too slow. And I love this because of any slide probably that we’re going to go through and talk about today, this is the one that I think a leader in a business can take, file away, and use it a little bit as a decoder ring to look into the future. It’s their crystal ball, I guess, to say, “Okay, when do we need to– when are we going to need to invest in EDI again? When do we need to be thinking about it?” Help them stay ahead of the curve and really address problems before they come up and have a big impact on the business. Yep. Yeah. That’s great. I think these companies, the brands are all trying to make the best decisions in the moment, right? It comes out like, “Hey, let’s just use web forms or let’s start manually handling these orders because we have to.” And that’s the best they can do in the moment. But then what happens over time is that that adds just a ton of complexity and a ton of stress on the business, because then you start to pile on all of the different provider options. So that’s a good segue into this slide. There’s really four different ways you can go about EDI. So in the market today, there are web form providers, so there’s big companies out there that will give you access to a web form where you can manually log in, you download any purchase orders, and then you key it into your system of record. The benefit is that it’s cheap. The challenge is that it’s very error-prone, doesn’t scale, and probably requires some data entry expertise to know your system and know how to key in these orders. The second option is that there’s integration brokerages. An integration brokerage will take your transactions and then somehow deliver them to you in a way that you can read them. You can start to integrate them into your ERP system. But really, what they’re providing is this communication layer and management. What this requires is a developer because what you’re doing is you’re sending the integration brokerage a transaction. Maybe they’re generating a EDI file for you and you’re seeing an XML file. But what this requires is actually expertise to generate these transactions and build out of your ERP system. Very common for brands to use integration brokerages. The third option is a managed service provider, so as a company starts to get a little bigger, they want to be completely hands-off. There’s a lot of marketing out there that says, “Hey, we can be your outsourced EDI provider.” I actually ran a consulting firm that used to do this and saw kind of the pros and cons of it. What happens is a company will outsource all of their EDI building and integration to a third party, and that third party promises that, “Hey, you can be hands-off. You don’t need any technical expertise in-house.” But the real problem is that the third party doesn’t actually know your business, they don’t know all the ins and outs of how you’re handling these orders, or how you want to ship your products. And they also don’t really have the same incentives that you do to manage these customer relationships. And then the third option is really to do it all yourself. This is to build these flat files on your own, build the X12 file, and actually stand up your own communication channels and send or receive its data on your own. The challenge with this is it takes a media expert to do it, and it can become really custom. I mean, you end up with an environment that needs to be maintained and managed over time. Yeah, I’ve certainly, Erik, I’ve seen all of these approaches in play, either engaged in them, in myself some way, or working with helping to build, facilitate, choose one of these options with clients in the past or customers now. And yeah, it’s really tough for growing organizations. You really have to weigh the tradeoffs of each of these approaches. And it’s kind of unfortunate because I’m going to be honest, I feel like until recently here, until new players have moved into the market, especially Orderful is trying to change the paradigm, there really hasn’t been a lot of good options. It’s been tough to make a decision. The do it all is so, so expensive, and it feels often like you’re rubbing sticks together to make fire and in rebuilding and literally rebuilding the will. But sometimes you need control, so that comes at a cost. And on the other end of the spectrum, I’ve seen so many companies go to the web forms approach as, “Hey, we need something quick and get going because we have orders coming in from a Target, Costco, or some big box customer.” But then they just stick there. They stick in that solution and then never really fully automated. And I’ve seen literally teams of people hand keying orders between the web forms interface and the ERP or the order management system. And in trying to untangle going in and then getting manual entry errors because of that, and just that stuff is a burden on the business. It’s really– And then again, there’s not a lot of– there’s a lot of managed– there’s a lot of use of the managed service provider, too that I’ve seen. But that’s where I’ve seen in some ways, the greatest dissatisfaction in the market. I’ve had a lot of customers come and say, “Hey, we work with so-and-so, but it’s just a black box for us. We can’t move fast enough. We can’t get new– it takes us six months to get trading partners up.” And that really holds back a business where you get automation, but now you’ve given up your speed and flexibility and any agility. That’s right. So, yeah, so what we’ve seen is what the market really wants is a tool where you can have full control of your supply chain and kind of manage it yourself. And it also reduces or eliminates the technical complexity of building these EDI integrations. And so we’ll get there and talk a little bit about how Orderful solves this. But yeah, these four options have evolved over time. And they’re really big businesses. So like EDI, you guys have been around forever. Every company that has supply chain’s integrating EDI. All of these different provider options, cut their teeth and made a ton of money providing their option on the market, but we see it as there being a better opportunity with a new kind of provider. So next slide. All right. And so typically what happens is as a brand evolves with the different stages of growth, you’ve grown into a 3PL, maybe you start with platforms, you sell into wholesale, maybe the brand starts using integration brokerage. When you get into drop shipping, maybe you’re looking at actually MSP and then an enterprise, you want to kind of bring it all in-house and might have a more enterprise-level experience and control. The challenges and we kind of alluded to this earlier is that as you enter these different phases, a lot of this technology and solution providers get layered on one another. So over time, you start to build– a brand starts to build a really complicated environment that becomes unmanageable as multiple service providers for EDI and is something that kind of grows out of control. Yeah, that certainly becomes very, very tough to manage for our organization. You have multiple panes of glass, so to speak, to try to understand where a critical transaction for one of your trading partners is moving through. You’ve got to get a look here, look there, look multiple places to track that down and what I’ve seen is that it increases the operational burden substantially in there’s a lot of actually hidden costs in there as you go and that difficulty of really knowing clearly and quickly what’s going on, especially because errors do arise. There’s business process changes that take place in an organization because these integrations are really just contracts and if there’s a use case that slips through the change management and impacts one of the– and results on a change in the data and you don’t have an alignment, I’ve got an error that’s bubbling up and it’s preventing a transaction from going through and that can have huge, huge consequences. That’s right. Yeah. The next slide talks about– I mean, air handling and kind of the management of these transactions, once you’re live, actually, can become extremely expensive to the business if you get it wrong. What happens is there’s kind of three different categories of errors. There’s chargebacks, there’s loss or fail trading partnerships. You can actually lose business because your EDI environment isn’t set up properly. I mean, then finally, if there’s these data entry errors that cause wasted time and productivity in your business. But the chargebacks, they’re really interesting because the retailer is enforcing, the goliath is enforcing all of these really intense requirements and SLAs for you as David, the small business to handle and kind of perform against, and as we’ve been talking throughout the journey, you just don’t have the right resources to be able to handle these requirements. An example would be if you’re doing web forms, it’s actually, the retailer’s not going to tell you this until it happens, but you need to actually key in the ASN or the 856 before the truck arrives. So you have a really small window to actually get this 856 keyed in and sent to your trading partner before your shipment actually runs to the dock so they can actually scan the shipment and receive it. If you don’t do this, like I think Walmart, right now, is charging 5% of the order value and a chargeback and it creates a really expensive relationship for– you’re already being kind of choked on margin with wholesale– I mean, these chargebacks are another way in which retailers are actually making money on their relationship with brands. The loss in failed trade partnerships is probably the worst-case scenario is when you’re trading with a partner and you miss transactions, you miss purchase orders, or you miss invoices, and eventually, those missed purchase orders become missed revenue opportunities for you. They also become really challenging for your trading partner because they’re expecting to put your products on their shelf and you didn’t fulfill the order. A lot of retailers have actually walked away from S&D relationships if these kinds of problems happen, so all the hard work that your sales team put into building this new retail relationship can quickly fall over if EDI isn’t handled properly. And then finally, the data entry errors, it goes to the old adage of garbage in, garbage out. If you̵