Direct to Store Deliveries (EDI Merchandise)
Direct to Store Deliveries occur when an order will be placed for delivery to a specific store. The order may be placed at the store manually or electronically. Another option is to have a central buying office order the merchandise for each store. The DSD model is very common for retail organizations with distributed ordering authority or franchised stores. The keys to the use of advanced notification of a shipment’s arrival in this scenario are:
- Improved labor scheduling for order processing. In a warehouse, there is usually a large pool of labor that can be used to process a large order that is received. In a retail store, rarely is there a dedicated labor pool that can be thrown at a large order. In addition, retail stores rarely have extra space to accommodate a large order for an extended period of time. In this scenario, the use of advanced shipment notification is very important for stores to be able to process large store receivings.
- Improved notification of merchandise arrival for the stores. The stores can anticipate when merchandise will be available when advanced notification is given. Again, this is very important when the source of the merchandise is far away from a retailer (e.g. a West Coast retailer whose vendor warehouses have been consolidated into fewer and fewer warehouses, primarily located in the East, thereby increasing the transit time for merchandise arrivals).
- Reduction in time to reconcile merchandise receipts to Purchase Orders and to Invoices. Typically, an Invoice cannot be paid until the goods are received, the Packing Slip is entered into the retailer’s receiving system, and the Invoice is received and reconciled to the original Purchase Order. The use of advanced notification of the arrival of the goods can allow receivings to be pre-entered into
the retailer’s receiving system, as opposed to waiting for a store to send in the receiving to a centralized receiving input office.