How Electronic Document Interchange (EDI) VANs are Costing Consumers

Electronic Document Interchange, or EDI, has been an emerging business requirement for manufacturers and vendors who want to do business with any major US retailer for almost two decades.  Originally it was a cost saving device for big boxes such as Home Depot, Wal-Mart, Lowes, Menards… pick almost any major retailer.  Lately it is still a bottom line savings measure for retailers, enabling them to submit purchase orders to vendors and distributors, receive electronic invoices and other business documentation that once required an army of paper pushers inside the organization, driving up prices through labor costs and inefficiencies.  Now the EDI landscape is changing.  The reduction in “the cost of doing business” for retailers through the use of EDI is beginning to be offset by an increase in the real cost of goods from manufacturers and distributors.  Please pardon the length of the forthcoming explanation while I try to reduce its complexity.

EDI transactions, the act of a retailer such as Wal-Mart submitting an electronic purchase order to a vendor such as 3M, can be completed using a variety of communication technologies such as AS2, FTP, SFTP, VAN to VAN, and several other base layer communication protocols.  The technology used is almost always selected by the retailer with compliance requirements becoming the responsibility of the manufacturer, vendor or distributor.  All well and good in the beginning as it saved either side from pushing paper, reduced delays in document receipt and payment receipt, benefiting the vendors.  An environment perfectly ripe for a middle man.  So look out… here comes the “VAN”.

VAN’s (Value Added Network) providers have always been a part of the EDI landscape.  The irony is this acronym implies they add any “value” to the retailer/vendor relationship.  VAN’s historically provided small manufacturers and distributors an outsourced solution to conducting business with large retailers by removing the need for in house IT staff and EDI specialists.  Then a few VAN’s began to believe that “Mom and Pop” shops were not a large enough revenue stream.  What they did was formulate a trend, started by companies like SPS Commerce, where they wedge themselves between many of the major retailers and their manufacturer/vendor base.   The way they did it was diabolical at minimum and what I’ve often referred to as a form of pseudo extortion.

Here’s how it works.  A VAN approaches a big box retailer and makes them a pretty astonishing offer: They will reduce or eliminate a large portion of the retailers EDI costs if the retailer will agree to sign on with the VAN as their EDI representation.  The retailer will not have to employee IT staff to manage EDI transactions, they will not have to host expensive software systems and telecommunication circuits (bandwidth) to handle the volume of data traffic necessary to conduct document interchanges with trading partners (the vendors and manufacturers).  The retailers will not have to manage document testing for new vendors and they will not need an internal department to produce and enforce electronic document standards.  They can eliminate all this EDI overhead for little or nothing, all they have to do is sign on with the VAN.  “Fantastic!”, says the CFO.  Now for the catch….

The only thing the VAN wants in return?  The retailers ENTIRE vendor base.  Now the VAN can approach the vendors and distributors with an ultimatum: Sign on and pay document testing fees, connectivity fees, transaction fees, kilo character (data) fees or else.  Or else what?  Or else lose your ability to conduct business with a big box retailer (your existing customer).  A consequence in revenue many vendors cannot afford so they give in to the demands of the VAN to retain their customer relationship.  So now instead of having hundreds of small customers, to whom they are providing simple EDI liaison services, they have thousands of small to large corporations paying them to conduct business with one of America’s largest retailers.  Sherwin Williams just went through such a transition during the last few years to a VAN called InfoAccess.  Please take the time to ask any Sherwin Williams representative or vendor how smoothly this has gone for either side.  Of course you’ll have to find a Sherwin Williams associate who’s prepared to be honest about the experience.

In the case of Sherwin Williams many of their vendors were previously using a communication technology called AS2.  This is a direct line (data connection) between the vendor and Sherwin Williams producing realtively little connectivity costs for either side.  Sherwin was required to staff an in-house EDI department which I assume is almost gone at this point.  Some vendors experienced an increase in the cost of doing business with Sherwin Williams.  Costs that will ultimately affect the wholesale price of goods to the retailer who will could pass the increase on to the customer.  Most retailers typically pass vendor price increases over to the consumer.

While intermediary VANs are fully prepared to offer great savings to retailers by removing in-house costs that they cannot pass on to the consumer, they are often creating an increase in the wholesale costs of goods from the vendors, distributors and manufacturers which retailers are happy to pass on to you, the consumer.  This is the side of the story VAN’s do not want to know.  Many retailers have decided to forgo offers from intermediary VAN’s and continue to support their EDI operations in house, several of which I mentioned at the beginning of this post.  Lowes, Home Depot and Wal-Mart continue to trade documents with vendors directly via AS2 communication.  Grainger Supply,  Bass Pro Shops and now Sherwin Williams are examples of companies that decided to turn the cost of EDI over to their vendor base by handing off the trade relationship to a VAN.   Speaking from experience, it is often much easier to conduct an EDI trading partnership directly with a retailer on a technical level than it is to go through the implementation and support gauntlet of a VAN.  Lower costs to manufacturers typically results in lower costs to consumers.  Many VAN’s are leveraging the customer/vendor relationship against consumers.   If I’m wrong someone please give me an example where a VAN, working on behalf of a retailer, has resulted in lower wholesale prices.

The real reason to avoid mapped drive letters in Windows.

I’ve been reading forum comments regarding the “pros and cons of mapped drives”.  Not one article I’ve found correctly addressed the issues surrounding mapping drives by letter verses their supposed benefits which are limited.  For historical reference, only Windows has “mapped drives”.  Linux, Unix and other operating systems including Apple OSX use “mount points” or in Apples case, “Connect to Server” (which is almost as bad as a mapped drive letter n but not quite).  Mount points and Apple “Server Connections” both require knowledge of the files real, genuine name of shared folder location on the network, often called the “UNC Path” in the Windows world, which stands for Universal Naming Convention.  We are reaching a point in computing where even end users can essentially be considered computer illiterate if they do not know the UNC Path to the files they work with daily.

So what are the real benefits of using “mapped drives” designated by a chosen drive letter:

  1. It is easy to reference for end users to understand.  This means an administrator can say “open your N drive” verses “open your Accounting share” or “your Accounting shared folder”.  I’m not sure why one is more confusing than the other in the end users brain but in my experience if I use the word “share” users give me the blank look of evil.
  2. I’m not sure there is a #2.  Any other administrators who can think of any other benefit of a mapped drive, leave a comment.  Sure administrators can map drives to network resources using scripts so end users are not choosing their own random, often conflicting drive letters.  That is more of a convenience to avoid potential issues of mapped drives than a benefit.

What are the limitations and issues caused by mapped drives:

  1. As any seasoned IT support veteran will tell you, on large networks there will inevitably be multiple “P drives” or a few “X drives” where X and P can be any letter in the alphabet, redundantly.  When a user calls for support they will only be able to tell you “I can’t get to my P drive”.  When you have “P drive” mapped to five different network shares from ten random workstations, good luck.  You’re about to dig on the users machine to find out the UNC Path, the true location of the network share their particular “P drive” is pointing to.
  2. Modern applications are not designed to translate drive letter designation.  Sure, MS Office and other historically Microsoft centric applications will adjust for the location of a users unique mapped drive designation.  Newer web based applications will often gag on them or not identify them at all.  Business reporting applications in particular, such as Qlikview and Business Objects, which rely on multiple data sources will make huge mess when trying to address those sources across a mapped drive letter.
  3. Virtualized applications make a mess and clog bandwidth trying to sling files around the world in circles and clog bandwidth to accommodate a file trying to be opened using a mapped drive.  If a user in Phoenix, AZ runs a virtual instance of MS Word from a server in Raleigh, NC and then tries to open a file located on a mapped drive of their workstation (which is sometimes pointing to a share location in Raleigh, NC) the file will make not one, but TWO trips across the network, download the file to the users local workstation memory and then Word can open the file.  Conversely, if the Phoenix user opens the same instance of Word published from the Raleigh Citrix server and then chooses “File…Open” or “Recent Files” inside word and uses the UNC Path to specify the file location, Word will open the file on the LAN, not across the WAN.  Don’t believe it.  Try it and see the difference.  The first scenario requires a file download into memory across the network, the second scenario opens the file directly and almost instantly.
  4. Mapped drives make end users uniformed, often lazy computer users.  They have no idea where their departmental or production network files reside.  They only know “N drive”.  Knowing file system hierarchy and server file locations on the network has historically made Unix, Linux and Mac users better computer users.  It is what truly separates the plain ol’ “stupid end users” from the intermediate users.  Anyone who does not know how to use the “backslash, backslash” \\ to find a file on a network share is not eligible to call themselves a “power user” under any circumstances as far as I’m concerned.  Any developer or IT support staff who does not know how to use a UNC Path needs to cover up that fact by learning quickly or just quit the job immediately.

There are many benefits to using UNC Paths, mount points, mapped server shares and very few to using mapped drive letters.  All the mapped drive was ever invented to do was dumb it down.  That’s never good but has been historically embraced because well…. people are lazy and don’t want to learn.


Worst of the worst… People who ride eBikes off road.

I don’t care if you take your MOPED down a designated, paved bike lane or down the middle of I-40 at rush hour. Don’t care if you go to the store on it, to your grandmas or to rent a Porta Potty. If you take one of these sorry ass excuses for a bike anywhere near a trail designated for “Non Motorized Use Only” I want your ass kicked. Period. In fact I hope you scare a horse, get back kicked into the gravel so the horse can stomp around on you violently causing numerous breaks and hemorrhaging. Yes, that is how much I hate lazy dolts on these stupid machines. They’re nothing but new liquor cycles for old men with DUI’s and those who pretend to like cycling but can’t ride a damn bike. Lazy, pathetic posers. Have fun in traffic just keep the damn things off the trail.

Absalon bests Shurter again.

I just watched Julien Absalon, the Michael Jordan of cross country mountain bike racing drop his greatest rival, Nino Shurter, who just couldn’t handle Absalon in Albstadt, Germany. In Nino’s defense Julien had his best ride in the last two years taking his 29th UCI World Cup win. Gotta wonder if it had anything to do with the new Shimano XTR Di2 electronic derailleur system he just got this week. “One of the best performance’s by Julien Absalon ever” said Bart Brentjens, winner of the first Olympic gold ever awarded in XC mountain biking.