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NAXML for Small Businesses

Convenience Store Industry, NACS Take Lead in Developing Technology Solutions for Small Businesses

Alexandria, VA, USA. January 7, 2002. Waltham, Mass.-based convenience store Store24, The Pepsi Bottling Group (PBG), and Professional Datasolutions, Inc. (PDI) are going live today with transmissions of electronic invoicing using Extensible Markup Language (XML), setting the standard for how small businesses can use advanced electronic technologies to increase efficiencies.

The XML guidelines were developed through the National Association of Convenience Stores' (NACS) technology standards project.

"No one else is doing what the convenience store channel is doing in developing the structure to support electronic data transmissions for smaller businesses," said John Hervey, NACS' chief technology officer. "The efforts of everyone involved in NACS' technology standards project will reap enormous benefits for stores, their vendors, and, ultimately, customers, as they increase efficiencies and accuracy of reporting, and reduce costs." Hervey said that pilot tests have taken place for several weeks, and that transmissions are going live today at a Charlestown, Mass. Store24. Later this month, Store24 will begin to roll out the technology to its to its other 80 convenience stores.

"This technology has moved well beyond the proof-of-concept stage and into actual implementation," said Bill Wade, manager of integration service for PDI. "It will significantly lower the barriers for implementation of e-commerce for small to mid-size companies in the convenience store industry." Of the nearly 120,000 convenience stores in the U.S., more than half of them are classified as small businesses in which they are part of a chain of 10 or fewer stores.

Electronic remittance and reconciliation between retailers and their vendors has often been beyond the reach of most small businesses, which have limited resources to support its implementation. Instead, most small businesses rely on traditional paper invoices and proof-of-delivery receipts from vendors.

For large companies, Electronic Data Interchange (EDI) is preferred for the computer-to-computer exchange of information between companies. However, EDI requires much more in the way of support for retailers using it, including a long learning curve, expensive translators, and a dedicated staff. These requirements put EDI beyond the reach of many small businesses, who need increased efficiencies and reduced costs to compete.

The solution for small businesses is to use a more user-friendly data exchange system -- XML. The NACS-developed XML guidelines, known as NAXML, use a Web-based technology, making the process much more attractive to solution providers that might be hesitant to work with smaller businesses. "In addition, NAXML addresses a broader range of business problems, meaning that we don't have to write new interfaces for each company or situation," said Wade.

Store24 is using XML to eliminate the blizzard of paperwork that accompanies every delivery to its stores. XML allows the store track shipments, proof of delivery, and other pertinent delivery details much more efficiently, quickly, and accurately.

The technology also benefits vendors, such as The Pepsi Bottling Group, which will be able to eventually incorporate electronic remittance and payment. By processing and reconciling information online, companies can eliminate costs associated with keying in data and cutting and processing checks for payments.

"We are excited about the opportunities that XML brings. It lowers some of the barriers that traditional EDI has, and will allow us to do business electronically with more of our trading partners," said Jack McLaughlin, director of information systems for The Store 24 Companies, which operates 81 Store24 convenience stores in the greater Boston area. McLaughlin noted that Store24 is already developing similar programs with two other large suppliers, as well as with the Massachusetts Lottery Commission.

Wade predicted that the NAXML guidelines will evolve and become more user-friendly as more trading partners enter into electronic relationships.

"This latest success helps set standards in place for other convenience stores and suppliers to develop similar efforts. The possibilities - and savings - are literally limitless," said Hervey.

The National Association of Convenience Stores (NACS) is an international trade association representing over 2,300 retail and 1,700 supplier members. The U.S. convenience store industry, with 119,750 stores across the country, posted $269 billion in total sales for 2000, with $165 billion in motor fuel sales.


Jeff Lenard
Tel: 703/684-3600, ext. 372

Prepared by Robin Cover for The XML Cover Pages archive. See "NACS XML Data Interchange (NAXML)."

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