EDI Advanced Shipment Notification Purpose In Logistics
EDI Advanced Shipment Notification has become the latest trend in retailing. The reason for the focus on advanced shipment notification is to reduce processing costs, time, and to improve knowledge of product delivery. If advanced shipment notification is provided by EDI, the shipment notification will report on:
- Vendor Information
- Shipment Identification
- Order Identification
- Packaging Identification (how the goods are packed, by store, by item, by pack, etc.)
- Item Identification (UPC, Vendor Number, Retailer SKU)
- Shipment quantity
The impact of EDI Advanced Shipment Notification will depend on how close the vendor base is to the retailer (the farther away, the more important advanced notification is) and the type of distribution that will be attempted when the goods arrive at the retailer. In retailing, there are three types of merchandise distribution:
- Central Stock. Central Stock distribution has merchandise shipped to a central warehouse and the stores will pull stock from
the central warehouse.
- Direct to Store Deliveries (DSD). Direct to Store Deliveries occur when an order will be placed for delivery to a specific store.
- Cross-Dock. Cross-Dock is an initiative to push the processing of goods from the retailer back to the vendor. The
EDI Advanced Ship Notice implementation dificulties:
- Vendors must be persuaded that they change their whole way of shipping goods to meet the retailer’s needs. The vendor might have to package by store, price the merchandise, and label the cartons all in the fashion that each retailer requires.
- The EDI Advanced Ship Notice has an extremely complex technical structure that makes implementation of it very difficult, unless a vendor commits a lot of money and effort to be able to implement it.
- The retail industry has not decided upon “standard” Advanced Ship Notification systems. This leads to a situation where a vendor has to package and process product differently for different retailers.
- The majority of retail EDI coordinators do not understand the business processes required for implementing an EDI Advanced Ship Notice. With Invoices and Purchase Orders, there is a paper document on which retail EDI coordinators base their standards. The Advanced Ship Notice is a new business process. Unless the EDI coordinator can understand the ordering and logistics cycle for all
merchandise, the implementation of the ASN is extremely difficult.