Tuesday, October 23, 2012
This article also is available on info.algorithminc.com where 1 EDI Source appeared as a guest blogger.
Companies that rely on EDI data often ask how they can receive alerts when a trading partner starts to buy a new item or changes pricing and payment terms without their knowledge. Some address these challenges by creating custom code while others manually review all purchase orders and invoices. However, both options are time consuming and can detract attention from other essential business tasks.
In addition to helping manage your EDI data, your EDI solutions provider also should offer tools and applications to help you do more with your EDI system, like fact check invoices and purchase orders. For example, 1 EDI Source recently introduced its Business Sense Module. This module actively monitors trading partner purchase orders and invoices and compares new versus old transaction details. The user is immediately notified as soon as the module detects a discrepancy. Applications like Business Sense can save you time and money.
Protect your business by keeping a close eye on these four purchase order and invoice changes typically made by trading partners.
1. New items
Have you ever received an invoice or purchase order with a new item that was not on previous transactions? We’re sure many of you have experienced this and know firsthand how an undetected change like this can affect your accounting and inventory processes.
2. Price changes
Unknown price changes – even by a few cents – can wreak havoc on your accounting department. A purchase order is a legal agreement between a buyer and seller of goods. Therefore, once you deliver products based on the new price, you are accepting the purchase order as is – even if your trading partner did not alert you of the change beforehand.
3. Payment term changes
As with price modifications, you accept the new payment terms if you continue to deliver goods despite the revision. So let’s say a trading partner sends you an 850, for example, with net 30 payment terms and all of a sudden the terms change to net 60. This can greatly affect your business operations.
4. Changes to existing items
Has a trading partner ever modified a UPC code or vendor item number without letting you know? A change to existing items could be your company’s trigger to start shipping new packaging or an updated version of a product. That’s why it’s so important to have a solution capable of alerting you immediately so you can review the changed items as soon as they are received by the system.
What’s the bottom line? Letting changes made by trading partners go undetected can cost you a significant amount of money. You can easily protect your company from these unknown changes by obtaining a system like the Business Sense Module that automates purchase order and invoice fact-checking by immediately alerting users when a trading partner changes pricing or other purchase order or invoice details.