SUCCESS STORYThe Co-operative Food
Industry• RetailSolution• OpenText™ Trading Grid™

Results
Unified B2B trading system
24x7 reliability
Minimal management throughreliable outsourcing

UK food retailer merges
trading networks

Co-operative Food transforms business and manages high volumeof supplier invoices with OpenText Trading Grid
“The ideal scenario is thatthe solution is so reliable
that you don’t notice anddon’t stop to think about
it. This is what we haveachieved with OpenText
Trading Grid.”
Alan Broadhurst

Solution Manager
The Co-operativeUK food retailer merges trading networks

The Co-operative Food forms the grocery brand of The Cooperative Group, which employs 70,000 people and has more than
3,500 retail outlets. The Co-operative Group is the fifth largest
food retailer in the United Kingdom.

Major acquisition
When The Co-operative Group spent more than 1.5 billion pounds(USD 2.3 billion) to acquire supermarket rival Somerfield, the acquisition
propelled the Group upwards by essentially doubling The Co-operative’s
UK market share from 4.5 to 8 percent and boosting its store portfolio
to just under 3,000.
The acquisition posed challenges, especially to those charged withintegrating the different systems and infrastructures within the twobusinesses. With the low success rate of recent acquisitions in theUK supermarket sector, the Co-operative was determined to manage
the acquisition smoothly and efficiently.
There were, naturally, many different aspects to the integration
effort, including negotiations with the Office of Fair Trading about
the location of newly acquired stores, which led to The Co-operative
divesting some of the stores it had gained. Meanwhile, stores wererebranded and logistics processes were re-engineered.
Although The Co-operative and Somerfield had many suppliersin common, the overlap was not 100 percent. For example,The Co-operative had its own range of food grown on its own farms
and, in line with its strong ethical credentials, The Co-operative’s
extensive Fairtrade range covers over 200 own-branded and 60
branded Fairtrade products. The Somerfield stores had a different
market profile and positioning, so an enormous amount of work wasinvested in aligning the outlets and product ranges.

Against such a complex background, it was vital forThe Co-operative Food business to have a completely reliable
electronic trading network that would allow it to go on trading with its
partners through a process of change. The trading network had to beflexible and scalable to adapt to a changing business environment.
A prime goal was to avoid any disruption with business as normal.

Trading network reliability
With its suppliers, the Co-operative Food business exchanges
70,000 invoices every week. There are around 1,400 suppliers who
trade electronically with The Co-operative. A prime requirement
was a system that could cope with this scale and volume oftransactions. As a long-standing user of the OpenText™ Trading
Grid™, The Co-operative can exchange standard business documents,
such as purchase orders, invoices and advance ship notices withsuppliers anywhere in the world in realtime. From the company’sperspective, the ability to mediate the differences between
The Co-operative’s preferred document format and the formats
chosen by trading partners is what makes the Trading Grid invaluable.
OpenText masks the complexities of diverse internet communication
standards, such as AS2, AS3, SFTP and FTPS, which reduces thesupport requirements and onboarding time required by individual
suppliers as they connect to the trading network.
Trading Grid plays an important part in helping The Co-operative
become an active business that can maintain a supply chain
supported by uninterrupted, continuous flow of sales, shipment
and payment information between organizations. The Co-operative
can send and receive information in any format and via any method
preferred by the trading partner in question without creating atechnology challenge or costly support burden for the business.

“One of the beauties of theenvironment is that we donot need to have a large
army of people attending
to it.”
Andy Edmondson

Application Analyst
The Co-operativeUK food retailer merges trading networks

High volume transactions
The sheer volume and value of invoices being exchanged on
Trading Grid—approximately 85 million pounds (USD 135 million) worthof supplier invoices are traded electronically each week—makes
the system a vital engine that powers The Co-operative Group’sbusiness. Reliability is an absolute necessity. “Given the value of thetransactions, this is an environment that you want to have up andrunning 24x7. The ideal scenario is that the solution is so reliable
that you don’t notice and don’t stop to think about it. This is what
we have achieved with OpenText Trading Grid,” explained
Alan Broadhurst, a solution manager at The Co-operative.

One of the key benefits of the Trading Grid—aside from being
business-critical—is that it does not require a large amount ofinternal resources dedicated to it. According to Andy Edmondson,
an application analyst at The Co-operative, “One of the beautiesof the application is that we do not need to have a large army ofpeople attending to it. In fact, we have a team of just four Cooperative employees who have responsibility for managing thetrading network at our end. The presence of OpenText meansthat we do not have to link directly with suppliers in terms of theirconnectivity since it takes care of that aspect of things.”

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