Perpetual EDI

Electronic Data Interchange (EDI) is the automated, application-to-application exchange of business data such as purchase orders, invoices and point of sales information. EDI automates the slow, labor-intensive processes of exchanging transactional documents in hard-copy form. The results are improved cycle times, greater in-stock positions, reduced error rates, and significant cost savings for companies using EDI. Committed to strengthening Vendor partnerships through electronic technology, sales and stock turns will increase and better service will be provided to our customers by electronically exchanging key business documents and information. All EDI business documents are within the accepted VICS (Voluntary Inter-Industry Communication Standards) guidelines. All transmissions are traded at the UPC (Universal Product Code) level, therefore, you must be 100% UPC marked. Following industry standards for EDI and UPC technology is the backbone to a successful EDI program. Please contact the Uniform Code Council (UCC) at 937-435-3870 if you require help implementing UPC's.

Our implementation focus will be to establish these EDI transactions to support the following replenishment scenarios defined below:

Warehouse Replenishment (850): Merchandising replenishment module monitors product activity and creates a purchase order to automatically replenish warehoused/basic stock merchandise. An 850 EDI purchase order transaction electronically sends the order to the Vendor (via third party VAN) for shipment to a regional warehouse or direct to store.

Vendor Managed Replenishment (852): Non-warehoused items with a recurring demand are replenished to the stores through Vendor managed replenishment. The Buyer and the Vendor determine each store's replenishable assortment and model stock levels. Sales information for all Vendor styles in all stores are sent via 852 EDI transactions. Some arrangements may require that Vendors maintain model stocks and perpetual inventory levels for each UPC by store; Intransit quantities, sales trends, and outstanding orders are monitored to adequately determine store requirements. Merchandise is shipped directly to each store against a pre-established Open Purchase Order.

In order to complete the exchange of data with ease and accuracy, adopt the EDI 852 and 855 Transaction Sets in both the UCS and X12 Standard. This will provide the control and uniformity that Kroger requires for this important data exchange with its suppliers. The following pages of this document explains the requirements and details associated with the 852 and 855 Transaction Sets.

• Provide the supplier with up to two years of weekly movement history on their items for the distribution centers on the VENDOR REPLENISHMENT program. This can be used for the suppliers forecasting and replenishment system to assure a smooth transition to the program.

• Peyton will provide the supplier with one year of weekly movement history on their items for the distribution centers on the VENDOR REPLENISHMENT program. This data will be provided only on a IBM3480 Tape in EDI format. This can be used for the suppliers forecasting and replenishment system to assure a smooth transition to the program.

• 875-850 "Turnaround Document". The setting up of this document should be discussed with a procurement staff member during the set up of the program. The "turnaround document" will be sent with a C=Confirmation code in the G5001 for the 875, and a 06=Confirmation code in the BEG01 for the 850. The Turnaround PO, will send back to our VMI vendor all of the information Kroger receives and process from the vendors 855, in addition to the pricing information we have in our system. This process will provide an extremely valuable tool to help our vendors better manage orders and inventory.  It will provide vendors with a "copy" of the purchase order created in our buying systems from 855 sent from vendors. VMI Vendors will see the purchase order just as the Procurement Teams sees it. How will the "Turnaround Document" help our VMI relationship?

• Provide verification that your 855 was received and that a purchase order was created in our Procurement systems.  A 997 Functional Acknowledgement is automatically sent from our EDI system when the 855 is accepted by our EDI system.  However, that does not mean that the 855 purchase order was actually created in our Procurement systems.  If you receive the Turnaround Document, you will know that a po has been created in our procurement systems and that Procurement and the DC can see the po in the system. Also it provides a verification that all items on your 855 are on the 875-850 Turnaround:  This is particularly helpful with regard to new items and becomes even more crucial as we continue migration from UPCs to GTINs.

• Provides verification that Kroger has the correct cost in our system for each item:  Pricing errors can be detected and resolved prior to the shipment’s arrival at the DC, thus preventing receiver errors, which lead to invoice deductions.  This becomes even more crucial as we continue to accept EDI Cost Changes. We encourage you to discuss the turnaround document with your EDI department / provider.  We feel the 875/850 turnaround document is an excellent opportunity to improve our VMI relationship.

• Implemented a change to the EDI 852 record. The change involved the addition of certain Promotional Contract Start and Stop Dates. The purpose of sending Promotional Contract Start and Stop Dates for “Off Invoice” and “Bill-back deals” is to help ensure products that have deals coming up are ordered at the correct times so Kroger gets the correct cost associated with the promotion. Kroger anticipates this will help in the reduction of deductions and post audit deductions.  As the analyst writes orders, these dates should be used to help assist in the decision as to the correct timing orders need to be placed within the promotional start and stop dates that buys should be made in order to support the upcoming promotions. There can be other promotional contract types.  If you have any business related questions as to this information please contact your buyer.  If an adjustment is needed to the dates of the contract these requests should be directed to the appropriate Category Manager.