FTP-based EDI vs.

Web Services: A Case Study in the Retailer Industry

Drew Hwang Marc Kenyon
Computer Information Systems Department The Net Commander
California State Polytechnic University 20760 E. Walnut Cyn.
Pomona, California, USA Walnut, California, USA
dhwang@csupomona.edu mkenyon@csupomona.edu

Abstract eMart order number, similar in format as 123456.xml, and

Web services technologies are being developed as the
foundation of a new generation of B2B applications. One of
the direct impacts is its replacement of the traditional
FTP-based EDI systems in the retail industry. This paper
illustrates the design of systems using these two approaches
and discusses the differences and important issues related to
order information storage, data transmission, system
extensibility, and security.
1. Introduction
A growing number of companies are creating B2B
applications to streamline their supply chain operations [1,2].
One of the major retailers in the U.S. (hereafter called eMart)
has also required its suppliers to develop software to
exchange daily flow of purchase orders, invoices, and
shipping notices. Currently, eMart is using an FTP-based
EDI approach for the data exchange process but is moving
toward a better solution known as web services.
Hired by one of eMart’s major vendor, The Net
Commander, a Los Angeles-based consulting firm, has
created a web service system that simulates the FTP-based
EDI approach for the data exchange process. This paper
illustrates the design of systems using the two approaches and
discusses the differences and important issues related to order
information storage, data transmission, system extensibility,
and security.
transferred, via FTP, to the vendor’s specific folder on the
eMart FTP server.
At this segment, the system moves onward to the point
of vendor interaction. In most cases, each vendor has an
established backend business system to manage inventory
and process specific orders as they are acquired. Integrating
the eMart order with the vendor’s backend occurs with the
use of a custom consol application built specifically for the
eMart vendors. With the application, each vendor is able to
login to the eMart FTP server and retrieve all orders placed
within the vendor’s specific folder during a specified time
span defined by the last time stamp of the final order
processed into the vendor’s database. As the XML files are
retrieved, child fields are parsed into their respective columns
and inserted as a new order into the vendors system.
Immediately following the parse of the order file, a
confirmation file in XML format is sent from the XML
application to the eMart FTP server to allow eMart to update
the order status and notify the customer the order has been
successfully processed.
Each vendor then processes the order and ships the
items to the respective eMart customers. Once items have
been shipped, the vendor must once again use the custom
application and send a second confirmation file in XML
format denoting that the item is successfully shipped, which

2. EDI-based FTP Approach

The current order tracking and processing system,
utilized by eMart for its major vendors, is comprised of an
FTP-based EDI system using XML formatted documents to
relay specific orders and associated consumer information to
a desired vendor.
Using a console shown in Figure 1, the system is
engaged during an order from the eMart e-commerce website
which formats the consumer’s user information, order
number, etc. along with each item’s SKU number, description,
quantity, etc. from the sale into a parent-child xml
arrangement. The entire consumer information content
comprises the first parent section with each additional section
specific to each item being purchased. Once order payment
has been completed the generated XML file is saved using the

Proceedings of the 2004 IEEE International Conference on Services Computing (SCC’04)

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 Figure 1. The FTP-based EDI System Console
Figure 2. The FTP-based EDI System
carrier was used and the tracking information for the package.
This information is placed on the eMart website for the
consumer to view. To ensure the eMart server has received
this information, a confirmation XML receipt is returned to
the vendor application.
Additional functionality to the vendor application
allows for each vendor to update the current online catalog by
submitting a properly formatted XML document to the eMart
FTP server. Subsequent to parsing the catalog file and
updating the item index, an XML confirmation file is returned
to the vendor’s application. The complete system is
illustrated in Figure 2.
3. Web Service Approach
Applying .NET and Web Services technology to the
equation, the new order transfer system currently being
developed will transform the approach vendors undergo in
retrieving new online orders from the eMart shopping arena.
In creating this new system, enhanced vendor integration
options become available as well as added security measures
to prohibit prying eyes from sensitive user information. Most
importantly, however, utilizing Web Services technology will
create the much needed API to connect to eMart’s order
database and return each vendor’s specific orders over HTTP
instead of the previous FTP request.
As in previous versions, vendor are required a custom
built application to bridge the gap between eMart’s file
formats and the ability to consume the orders into some types
of backend system. For those with high end, recently built
systems, integrating the Web Services result sets will require
Proceedings of the 2004 IEEE International Conference on Services Computing (SCC’04)
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less development time and ultimately result in less cost to
facilitate the synchronization. For other vendors whose
systems could not consume xml formats, smaller packages,
such as Microsoft Excel, are able to connect to Web Services
and manipulate the data directly. Keeping each vendor on the
same page allows eMart to reduce subsequent costs in
conforming to multiple standards. For the same reason, no
matter what development platform each vendor operates on,
such as Novell, Java, Oracle or SQL Server, each system can
facilitate the use of Web Services utilizing similar techniques
defined in the SOAP protocol.
As outlined in figure 3, the new order system begins
with an order being placed from eMart’s website collecting
user and item information. Once order payment has been
concluded, the order information is inserted into the eMart
order database via a Web Service request.
Figure 3. The Web Services System
During the polling process from the vendor’s custom
application, an additional web service is triggered to carry the
date and time stamp from the last entry in the vendor’s
database to the eMart order database. Once a request from a
vendor has been initiated (see the system console in Figure 4),
a web method is called through a client proxy, transferring
with it the latest date, time and the vendor’s identification
number as parameters to the Web Service. Once the eMart
server has received the call and the parameters, the compiled
code behind functions, written in VB.NET, process the
requested data from the attached order database using in-line
SQL statements that return a .NET structured dataset
containing all unprocessed orders for that specific vendor.
This information is serialized and returned to the vendor via
the SOAP protocol over HTTP as the result set of the web
 method. Once all XML data has been delivered, the Vendor’s
client application de-serializes the information back into the
dataset format and parses it into the vendor’s backend system.
Figure 4. The Web Services System Console
At this point in the process, the vendor commences the
process of filling the orders and shipping the purchased items
to the consumer. Immediately after the shipment process has
been completed, the vendor completes the cycle employing
the application one last time to trigger another Web Service
updating the order status with shipment information and
receiving a confirmation in the Web Service’s resulting XML.
As it relates to updating vendor catalogs with new items
or removing outdated or out of stock items, the Web Services
system should include the same functionalities. The vendor
application or ASP.NET web application provides a user
friendly front end to allow vendors to browse their current
online catalog, update item information, add new items or
remove items completely. The Web Service methods also
allow for seamless integration with eMart servers without
compromising access to the file system or other vendor’s
information, and with the utilization of SSL technology with
each HTTP request, all Web Services traffic can be encrypted
to prevent unauthorized access.
4. Discussions
The current FTP-based system supplies an adequate
functionality base for eMart and its vendors to develop the
new Web Services system. However, there are some
important differences between the two approaches. The
following section discusses the differences and other related
issues.
4.1. Order information storage
Order information storage, as it is currently
warehoused, utilizes the operating system’s file structure to
create file folders for each vendor capable of being accessed
via FTP. Order information is uploaded and downloaded
using username and password authentication from either
eMart or a vendor. In comparison, the Web Services system
employs a web server running IIS and an attached database
Proceedings of the 2004 IEEE International Conference on Services Computing (SCC’04)
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for a much more organized compilation of customers, their
orders and vendor statuses for each order. By moving away
from file system organization, all orders, vendor statuses and
shipping information can be contained in one location rather
than multiple files, and with the use of SQL, complex
reporting and detailed order history can be accessed on
demand instead of browsing through multiple order
documents.
4.2. Data Transmission
When analyzing the two systems, data transmission
method stands as the most prominent difference between
them. The current FTP-based system simply copies order
information from one computer to another, creating excessive
redundancy and ultimately requiring greater system resources.
On the contrary, Web Services creates API methods to
retrieve order information from the eEMart database. These
methods create XML formatted documents that can be
displayed or consumed into each vendor’s own backend
system. Order information can then be updated and
maintained just as fast by initiating other methods to transmit
content back to eMart.
4.3. System Extensibility
System extensibility, for many large companies, is a
major requirement of new technology that is to be
implemented to replace a functional system. With the current
FTP-based system, updating data format or warehousing
requires a substantial modification of each vendor’s custom
application as well as changes to the XML file format schema.
Since the Web Services methods create the XML formatted
files on demand, schema changes can be made on the eMart
web server and the changes are immediately available to each
vendor. Also, if a Web Service method is modified to add or
remove parameters or result sets, only minor changes to the
vendor application must be made.
4.4. Security
Almost every corporation that engages in Internet sales
and data transmission keeps the security of their data as a high
priority and under close supervision. The current system,
other than plain text authorization to the FTP server, does not
prohibit unauthorized access to the order information during
transfer from server to server. This is, by specification, all the
FTP protocol offers in terms of security. For the most part,
the Web Services specification does not offer much more
benefit. However, security can be added to Web Services’
HTTP layer for data transfer and the application layer for
internal kernel protection. For all e-commerce systems, the
use of SSL technology is a requirement for consumers to even
ponder purchasing from the web. Likewise, SSL offers 128
bit encrypted data transfer from eMart to vendors and vice
versa. Additionally, since new Web Services systems can be
developed through the collaboration between eMart and its
vendors, agreed encryption algorithms can be integrated
allowing supplementary security on top of SSL.
 Conclusion
While the current FTP-based system supplies an
adequate functionality base for the development of the new
Web Services system, the Web services approach intends to
provide a better solution for data exchange between
businesses. Through illustration, this paper found that
traditional FTP-based EDI approach is in disadvantage when
issues such as order information storage, data transmission,
system extensibility, and security are essential considerations
to system design and development. However, the systems
being studied are running on Microsoft's .NET
platform. Further study is needed to compare the two
approaches in different computer platforms.

References
[1] A. Gilbert, "Wal-Mart Project Boon for Software Makers",
CNET News.com, August 14, 2003.

[2] M. Kane, "Amazon, Google Lead New Path to Web

Services", CNET News.com, November 20, 2002.

Proceedings of the 2004 IEEE International Conference on Services Computing (SCC’04)

0-7695-2225-4/04 $ 20.00 IEEE