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2 Norman Katz, Katzscan Inc. ( Specialties: –Barcode applications (inventory, mfg) –Electronic Data Interchange (EDI) / e-B2B –Supply chain vendor compliance Since January 1996 NMMA Supply Chain Consultant since 4/2004 MDX Technical/Business Lead since 1/2005 Resource available to all marine industry companies (mfgr, distributor, boat builder, retailer)

3 What is the MDX? How is the MDX used? Why MDX? Who uses the MDX? Benefits of the MDX! MDX and the Supply Chain

4 What is the MDX?

5 Internet-based software program developed & hosted by the NMMA Used to transfer business documents as electronic data files –First done in the mid 1970’s (EDI) –Common in many other industries Supply chain enablement tool –Users are called “trading partners”

6 Enables electronic business document communications Removes barriers created by spam filters and anti-virus software – better than Creates internal & external efficiencies Consolidates business document lifecycle to a single data repository

7 Will not generate data Will not validate data Will not count your inventory Will not manufacture products Will not read your mind Will not make your morning coffee or afternoon tea

8 A communications pipeline between a buyer and seller A very low cost supply chain enablement tool A way to reduce / eliminate errors A way to increase / improve efficiencies A way to do business better

9 Purchase Order Purchase Order Change Purchase Order Acknowledgement Advance Ship Notice Invoice

10 Sent from the buyer to the seller (from the customer to the supplier) A commitment to buy goods and services Contents: items, quantities, prices, payment terms, ship-to, delivery information, dates

11 Sent from seller to buyer Used to accept or reject all or part of a PO: –Item quantities –Delivery dates –Unit Prices Used to verify receipt of a PO

12 Sent from buyer to seller Modifies a previously sent PO –Delivery date –Item quantities –Item costs Should be used to verify a seller’s modification via the PO ACK Should be used with restrictions to avoid excessive / late PO changes very close to ship date

13 Sent from seller to buyer Acts as an electronic bill of lading Contains shipment information: –Carrier, Ship To, Ship From –Weight & Volume –Items and quantities –PRO # / tracking #

14 Sent from seller to buyer Requests payment for goods shipped, not ordered Contents: –Payment terms, remit to, vendor ID –Item, quantities, costs, taxes –Adjustments, i.e. freight costs

15 Buyer Seller (1) (1)Buyer sends PO (2)Seller sends PO ACK (3)Seller sends ASN (4)Seller sends Invoice (2) (3) (4) Solid line = sent doc Dashed line = recv’d doc MDX

Buyer sends a PO to the Seller. 2.Seller rejects part of the PO; sends PO ACK to the Buyer. 3.Buyer updates the PO in Buyer’s ERP system to reflect changes. (Assumes Buyer accepts Seller’s changes.) 4.Buyer resends updated PO to Seller. 5.Seller sends PO ACK to Buyer with no changes, accepting updated PO. 6.Seller sends Buyer an ASN when shipping. 7.Seller sends Buyer an Invoice after shipping. Easily accomplished with automated processes.

Buyer sends a PO to the Seller. 2.Seller rejects part of the PO; sends PO ACK to the Buyer. 3.Buyer cancels the original PO in Buyer’s ERP system. (Buyer accepts Seller’s changes.) 4.Buyer creates new PO to send to Seller. 5.Seller sends PO ACK to Buyer with no changes, accepting new PO. 6.Seller sends Buyer an ASN when shipping. 7.Seller sends Buyer an Invoice after shipping. Easily accomplished with automated processes.

18 How is the MDX used?

19 User Interfaces: –Web Form –Software Integration Helpful Documentation Business relationship procedures

20 Requires high-speed connection to the Internet (cable or DSL) No software to purchase Similar to an mailbox: –Retrieve and print inbound documents –Data enter and send outbound documents

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32 Purchase Orders can be automatically converted to: –PO Acknowledgements –PO Changes Saves redundant data entry PO ACK’s and PO CHG’s can be further edited before sending

33 Open platform – any operating system –Windows® –Unix® –AS/400® –VAX VMS® –HP/UX® Uses Secure Socket Layer (SSL) File Transfer Protocol (FTP) Software application independent

34 The following documentation is available on the MDX web site Downloads page to help you: Data File Standards MDX FTP Client Web Forms System Integration Overview Trading Partner Checklist …..more to come

35 Used for software integration Text files ANSI X12 EDI version 4010

36 Applies to all MDX transaction files Describes general data file and data record structures characteristics Data field and data record delimiters Data field notations Read before individual transaction file data standards

37 One document for each business transaction file (i.e. PO, ASN, Invoice) Data records and data fields in detail Data field characteristics (i.e. M/O, alpha vs. numeric, min/max lengths) Sample data file

38 Free Windows®-based secure FTP software Accompanying user guide Easy to install and use Not applicable for non-Windows platforms Not as flexible as 3 rd party options

39 Contains a screen snap-shot of every web form screen in the MDX How to maneuver through the MDX Pushbutton functions for each screen General web form functionality

40 Describes trading partner relationship –Customer –Supplier Trading partner responsibilities Testing methodology Business procedure changes

41 BuyerSeller EXTRACT: PO Header PO Detail APPEND: SO Header SO Detail MDX > SSL FTP <

42 Used to document data field requirements by transaction –Inbound –Outbound Established by the customer (“buyer”) Does not vary by supplier (“seller”)

43 Data record requirements Data field characteristics Internal notes only (2 nd copy): –Notate application files and fields for outbound file generation –Notate application files and fields for inbound data file validation & append

44 Data record requirements Data field characteristics Internal notes only: –Notate application files and fields for outbound file generation –Notate application files and fields for inbound file data validation & append Helps to organize and standardize software programming for multiple trading partners

45 Once “electronic”, no business commitments or changes via: –Paper – –Fax –Telephone Consolidates communications to a single pipeline…..

46 All communications relating to a business transaction are now documented in the MDX No more searching multiple sources: – –Phone conversation notes –Fax –Paper / postal mail

47 Why MDX?

48 Introduce good supply chain practices to the marine industry Affordable supply chain enablement Foster growth by helping companies conduct business more efficiently and effectively

49 You are trading partners, not trading adversaries Enable your suppliers by providing tools for success – don’t just dictate rules Suppliers must grow with their customers needs Suppliers can often leverage customer requirements for themselves (i.e. barcode labeling)

50 MDXEDI Transaction charges (per 1,000 chars) NOYes, 10’s or 100’s of dollars per month Monthly feesNOYes, 10’s or 100’s of dollars per month NMMA Member Costs $900 one-time fee, $300 annual, no software to buy Varies extremely, may involve software purchase

51 Efficiencies for buyer and seller Efficiencies via web form or integration Fosters a better (more efficient) trading partner relationship Reduce / eliminate manual errors Speed processing Can be a competitive advantage

52 Buyers & Sellers can both suffer from: –Lost documents (mail, fax) –Blocked s (spam, anti-virus) –Illegible handwriting –Manual data entry errors –Phone / tag –Long distance phone charges –Unnecessary follow-up’s –Tasks that waste time (anti “Lean”)

53 Internal growth: more efficiencies = more profits Internal growth: more profits = business expansion / product innovation External growth: increased sales External growth: reduce competition (on-shore & off-shore)

54 Who uses the MDX?

55 The MDX can be used by: –Accessory Manufacturers –Distributors –Boat Builders –Engine Manufacturers –Retailers

56 The MDX can be used by marine companies to conduct efficient e-B2B with non-marine industry suppliers Supply chain enablement within and outside the marine industry

57 Benefits of the MDX!

58 Direct point-to-point electronic communications No concerns associated with –Verify better than "read receipts" which are not available through all services –Bypass restrictions such as spam blocking and virus filtering

59 Enable automation with optional system integration Improve accuracy of information Reduce paperwork Eliminate manual data entry errors Eliminate errors due to illegible hand-written characters Eliminate lost purchase orders & invoices Verify shipment receipt faster Eliminate need for follow-up telephone calls: –Increases office staff efficiency –Reduces long-distance telephone bills

60 Supply chain is internal and external Internal –Communication between departments External –Communication to suppliers –Communication to customers

61 Improve inter-departmental communication –Purchasing –Accounting –Warehouse Automate cross-validation of MDX documents

62 Warehouse receipt should match ASN –Stop & determine / correct mismatch errors ASN should “match” PO –Except backorders & short shipments –Over-shipments? Wrong items? Invoice should match ASN; ASN previously matched to warehouse receipt; ASN previously validated to PO

63 Verification of business document communications –Content –Transport Speed business document transport –PO, PO Ack, PO Chg –Invoice

64 Move closer to Just In Time (JIT) –PO, PO Chg, PO Ack require less transport time –Leaner inventory levels Replenishment PO automation eliminates manual involvement –Reduces number of supplier PO’s –Catch “close to replenishment” items & order them –Shipment consolidation, reduces freight costs

65 Any questions?