Supermarket chain Asda has begun rolling out web-based electronic data interchange technology to 650 suppliers. Experts believe the technology will have a profound impact on the retail and manufacturing industries.
Web EDI technology is based on the AS2 standard, an internationally accepted HTTP-based protocol used to send real-time data in multiple formats securely over the internet. It promises to improve the efficiency and speed of traditional EDI communications, which route data over third-party value-added networks.
Asda, which is using AS2 technology from a number of software suppliers including iSoft, said web EDI would bring a number of benefits. Parent company Wal-Mart has been using the technology in the US since last year.
"We have been looking for alternatives to dial-up EDI to speed supplier reaction to our business requirements," said Andy Haywood, IT director at Asda. "AS2 meets both our suppliers' and our own needs, bringing with it benefits including faster and more secure transfer of data and reduced data transmission costs."
The technology will speed up the stock replenishment cycle, give flexibility to increase data volumes at no extra cost and improve tracking of inbound and outbound data, Haywood said.
Asda's plan to use AS2 is the "biggest change in traditional EDI in 15 years" and will have a profound impact across the retail and manufacturing sectors, according to UK standards body e.centre.
"AS2 is going to have quite an effect on the market," said Gary Lynch, business development manager at e.centre. "If Tesco or Sainsbury's can see Asda getting measurable benefits, they will have to look at it."
Both Tesco and Sainsbury's already use web EDI to communicate with suppliers, but only at a log-on/password level.
To ensure compatibility with AS2, many of Asda's suppliers will have to upgrade their existing EDI systems, Lynch said. "The small suppliers with only one hub should not have too much of a problem, but the medium-sized and larger players will have to address the issue," he said.
Some EDI systems cannot upgrade to web EDI, so suppliers with multiple hubs will have to add software to encode the AS2 messages, Lynch said.
To help with the changeover, Asda has negotiated the option of a free single licence of AS2 software for its suppliers. It also said the traditional EDI system would run in parallel for firms that do not want to move to AS2 yet.