Logistics technology: 3PL Central, SPS Commerce team up for EDI/WMS collaboration

Jeff Berman, Group News Editor -- Logistics Management, 8/28/2008

MINNEAPOLIS, Minn. and OREM, Ut.—SPS Commerce, a provider of software-as-a-service Electronic Data Interchange services, and 3PL Central, a provider of on-demand third-party logistics software, announced this week they have joined hands on a new offering geared towards small- and mid-sized 3PLs.

The companies said in a statement that this offering combines SPS’ EDI technology with 3PL Central’s warehouse management system (WMS) capabilities via an on-demand or SaaS model to eliminate the need for on-site hardware, hardware, and expertise. They added that small- and mid-sized 3PLs can leverage this offering for things like improved communications, supply chain visibility, and a streamlined order fulfillment cycle for customers.

3PL Central Vice President of Sales and Marketing Steven Katz told LM that customer demand is what drove this collaboration/partnership, explaining that a current SPS Commerce customer contacted 3PL Central during its warehouse management system (WMS) evaluation process and asked 3PL Central to integrate with SPS Commerce to support its business.  This first joint customer, Katz said, was the catalyst for the initial contact but almost immediately both companies saw the benefit of a larger partnership.  The first contact was made 5-6 months ago, added Katz.

When asked what the biggest of this initiative for small- and mid-sized 3PLs and their (shipper) customers, Katz explained that “SPS Commerce and 3PL Central offers a pre-wired [offering] that allows 3PLs and their customers to make better business decisions faster and more accurately—all on-demand and available without purchasing hardware or software.”

And the collaboration also allows 3PLs to quickly comply with their customers’ EDI or data requirements, as well as eliminate re-keying of order and shipping information for better accuracy and direct visibility for better control and customer service, the companies said.

3PL’s Katz offered up the following as an example of how the collaboration between 3PL Central and SPS Commerce works: A 3PL has the opportunity to work with a new client (shipper), but the client has needs for sophisticated EDI communications with their retailer customers.  SPS Commerce can support the supplier's communication needs with each of their retailers (order receipt, invoicing, etc.).  But since this supplier uses a 3PL to ship their orders to the retailer, they also need to "EDI enable" the 3PL.  This is handled through the pre-integration with 3PL Central.  SPS Commerce would route the supplier's orders to the appropriate 3PL and at that point the orders are automatically created in 3PL Central's 3PL Warehouse Manager.  Once the warehouse operation picks, packs and prints UCC-128 labels from 3PL Warehouse Manager the shipment is sent to the retailer, 3PL Warehouse Manager automatically communicates the shipment information back to SPS Commerce for retailer ASN notification and invoicing.

“The power of the solution is that it completely eliminates any manual data entry resulting in much better accuracy,” said Katz. “Also, it empowers a 3PL to have the ability to send ASN (EDI 856) notifications on behalf of their clients—this is a growing trend and very difficult for a 3PL to handle with in-house systems.  Also, SPS Commerce ensures that all of the retailer EDI communications are compliant—mitigating the risk of chargebacks. The joint 3PL Central/SPS Commerce solution provides a small to mid-sized 3PL the system functionality of a large 3PL, running a Tier-1 WMS system and who has an in-house EDI department—and they can do this without purchasing any hardware, software or hiring any staff.”