The SSCS Interview: Steve Baus of Baus Systems, LLC

It’s the Efficiency that Counts

Steve Baus is a Partner in Baus Systems LLC, a software provider specializing in solutions to streamline the food industry supply chain. Their standalone software solution, StoreDEX, allows grocers and C-stores to electronically receive a Direct Store Delivery (DSD) invoice created by the hand-held terminal the distributor uses to scan the delivery. The invoice file is electronically delivered to the grocer or C-store’s back office system, including (in the interest of full disclosure) our own Computerized Daily Book (CDB).

DEX (Digital Exchange) is the standard—a universal commercial code—utilized by StoreDEX. After items are scanned, the vendor’s hand-held terminal is connected to a DEX “box” which is connected to the retailer’s PC. The delivery file (electronic invoice) resident in the hand-held device is then transferred to the PC using the DEX box and the StoreDEX software. Once the file is on the PC it can be converted to use by the retailer’s back office system (for additional information, visit www.storedex.com).

It’s no secret that the application of technology to the C-store operator’s daily processes drives store efficiencies. And because electronic invoicing and file transfer play a central role in this type of streamlining, we thought it would be worthwhile to catch up with someone who is positioned at the heart of these advances to get an insider’s perspective on the challenges that go into delivering them. Steve graciously agreed to the following conversation.

SSCS: How have you seen electronic processing and ordering evolve over the years? What market factors have helped drive it?

Steve Baus: When I began my involvement with DEX in 1990, only a few of the major grocery chains were using the standard. Over time more retailers began to adopt it as one option of electronic data interchange (EDI). This development was driven by a broader trend: improved mobile technology that provided the consumer greater functionality with lower costs. Suddenly, even the smallest distributors could justify a handheld computer system.

As a result, today most DSD distributors have the ability to create invoices electronically and send them to the retailer, through a number of formats including the DEX standard. We are at the point where the large grocery chains expect distributors to have this capability. In some cases the retailer won’t allow a distributor to become a trading partner unless that distributor can send the invoices using some form of EDI.

We’re moving to the point where the ability to perform electronic invoicing and ordering will just be assumed—and that day is not far away. Those that can’t leverage the technology will lose out on efficiency and perhaps be viewed as less than ideal trading partners because all sides benefit from electronic data exchange. Everyone wins. We’ve found that when stores make a strong case that the technology should be adopted, the distributors are far more likely to fall in line and provide a solution compatible with the retailer.

SSCS: Why did your company get involved in providing a DEX solution to the industry?

SB: We would occasionally get a call from a retailer looking to utilize a DEX solution. We would pass that information on to the appropriate party, but soon found there often wasn’t a solution for the smaller chains or individual stores.

Around 2006 I got one such call from a single-site C-store owner in New Jersey who happened to have another job as a commercial pilot. He told me the time he spent entering invoices by hand was killing him. He knew that most of his distributors had the ability to electronically send him the data. All he wanted was a tool to get said data to import automatically into his accounting software. I told him our DSD distributor clients used an internal testing tool we had developed to test the DEX software and that I thought it would do most of what he needed if his accounting provider could handle the import. That’s how StoreDEX got its start.

SSCS: How does your company prepare for the changes you may have to face in electronic invoicing and ordering?

SB: Since our company is DEX-focused, I make sure I stay involved with the DEX working group, consisting of large distributors, store representatives, GS-1 members and technology companies. We work on updating the DEX standard, in general, usually with a monthly conference call. Currently the technology sub group is focusing on wireless transfers while the business group is working on updates to better handle issues such as taxes and traceability.

SSCS: As a provider of an electronic invoicing solution, what are the biggest challenges in getting your prospective customers to understand the benefit—to “see the light”—so to speak?

SB: For us, it’s getting the word out. I’m constantly surprised by how many retailers are unaware of DEX and the fact that we have a cost-effective solution that utilizes the standard. One of the items on the agenda of the DEX working group is to educate the industry regarding DEX functionality. I would expect that to be happening in the next year or so.

As far as getting customers to “see the light”, often they either immediately get the benefit or they don’t. We run into cases of retailers who have done back door receiving a certain way for many years and that’s just what they do; it’s hard to convince them otherwise. There’s also the fact that what we provide is so seamless it hardly calls attention to itself, so those expecting a lot of showy bells and whistles may be a little surprised. The data just gets there—it just happens—there isn’t a lot to see. It’s the efficiency that counts.