Understanding EDI, ASNs, and Supply Chain Challenges

Supply chain efficiency is now a major focal point for logistics companies. These firms are facing a slew of challenges, including COVID-related slowdowns, widespread staffing shortages, and rising inflation.

How can companies keep shipments moving on schedule, prevent backlogs, and make customers happy? They need to consider adopting digital technologies that automate workflows, streamline processes, and otherwise reduce complexity. 

In this article, we’ll explore how you can use electronic data interchange (EDI) to share advanced shipping notices (ASNs). We’ll also examine how EDI and ASNs can help your business minimize shipping errors and maintain strong supply chain relationships—much to the delight of all stakeholders in your organization.

What Is EDI?

EDI is a popular logistics framework for transmitting electronic documents and executing workflows. While your company doesn’t have to be EDI compliant, it’s a great way to build trust and maintain a competitive edge. 

Within the EDI model, there are multiple categories for various tasks. These include communication, finance, government, regulatory, transportation, shipping, and insurance. For example, you can use EDI to cancel a booking or transmit customers’ names and addresses. Another popular EDI example is vehicle damage and reporting. Whatever the use case, each code has a correlating number. 

While EDI processes vary across different workflows, all transactions aim to reduce human interaction and avoid manual, time-consuming data processing workflows

EDI 856: Advance Ship Notice

One important EDI process to know about is ASN EDI, also called an EDI 856. 

Here’s how it works: A logistics provider sends an EDI 856 to a distributor or retailer before they ship a product. This informs the recipient about what they will receive, how much they will receive, and when the package will arrive. 

The main purpose of an EDI 856 is to notify the customer of a shipping arrangement and give details to enable processing. This form should contain a shipment number, shipping date, expected delivery date, full address information, and item details and quantities, among other things. The EDI 856 should also contain tracking information and packaging details.

How ASN and EDI Help Improve Logistics

EDI 856 is a common type of EDI transaction. Sending an ASN in EDI format can help streamline shipping and enable logistics companies to overcome numerous obstacles along the way.

Let’s look at five specific ways ASN EDI can make life easier.

1. Alleviate Transaction Delays

Most major retailers and distributors now require partners to use EDI transactions. As such, if your business can’t quickly produce an 856, it could lead to complications and delays. And that’s not good for business.

With a secure document sharing system in place, you can quickly transmit EDI 856 notifications and customize them for specific partners. By taking this approach, you can expedite deliveries and avoid issues—which enables you to build a stronger business. 

2. Ensure Smooth Deliveries

Communication breakdowns often occur between shipping and receiving parties. For example, the receiving party may miss some important correspondence, leading to a backup and causing products to pile up on ships and warehouses. This can lead to heavy fines and—depending on the line of business—product loss.

As a logistics provider, you can‘t always control what happens outside of your company. But by completing an 856 exchange, you can do your part to communicate an upcoming shipment and make sure the receiving party knows about the delivery and is capable of receiving it and completing the transaction. This can give the other party time to notify you of any potential delays or if they’re unable to handle the request.

3. Settle Disputes

Shipping can be fast-paced and chaotic. For this reason, it’s common for disputes to materialize between shipping and receiving parties. That being the case, it pays to have documentation immediately accessible over any mobile device. That way, you can settle disputes quickly and efficiently when they arise.

To illustrate, imagine a boat carrying fresh produce arrives in a port. Unfortunately, the facility can’t process the delivery due to overbooking, which causes the produce to spoil. In this case, the EDI could help provide greater visibility into the shipping agreement to determine who’s at fault. 

4. Maximize Supply Chain Efficiency 

Ultimately, your company is a cog in a larger supply chain. As such, it’s important to do your part to keep items moving quickly and efficiently. By maintaining EDI compliance and offering digital EDI 856 forms, your team can communicate to partners that the organization is working to achieve an efficient supply chain. 

5. Boost Customer Satisfaction

At the end of the day, your job is to move items to customers on time. But to accomplish this, you need to iron out the kinks in your delivery workflows. To this end, digitizing your advance ship notices and following the EDI 856 model is a great way to start.

Key Considerations for ASN and EDI

Without a doubt, digitizing and automating shipping notices can lead to performance gains, larger profits, and happier customers. But there are some important things to keep in mind if you want to unlock the maximum benefits.  

With that in mind, here are some key points to consider before integrating ASN and EDI.

Prioritize Privacy and Security 

Not all EDI shipping platforms offer the same level of security and privacy. It’s important to work with a provider that has a strong commitment to both. By doing so, you can protect your data and prevent cybersecurity issues from affecting operations.

Customer Support Is Key 

Eventually, your team will run into a problem that’ll require customer support. When that happens, it pays to work with a vendor that can demonstrate a strong commitment to customer care. Make sure the vendor is available to provide prompt and speedy service whenever it’s necessary.

Use Accurate and Reliable Software 

The EDI software you select will allow you to process shipping notifications at scale. As such, the software needs to be highly accurate and reliable. Unreliable systems can lead to production and shipping errors, which can negatively impact customer relations and harm your bottom line.

Test Before Deploying

Switching to a digital shipping notification system will require your team members and supply chain partners to adjust to a new way of working. That’s why it’s important to consider their current workflows and be strategic about how you deploy your software. 

As a best practice, you should consider deploying slowly and testing the process with a small group of dedicated users, and scale as you go along.

Use Flexible Software 

Integration is another important point to keep in mind. Your EDI system should be able to seamlessly integrate with additional software and hardware components. It should also be mobile-friendly and capable of operating seamlessly over any device or interface.

What’s more, the software should be fully customizable and capable of meeting the diverse requirements of your shipping partners. Look for a system that will allow you to easily make changes and adjust forms.

Improve Supply Chain Visibility With Vector 

Right now, there’s serious demand for better supply chain visibility in shipping. High fragmentation and an overall lack of communication can make it difficult for companies to move products and satisfy customers.

By digitizing manual workflows and following EDI protocols, you can improve supply chain performance and strengthen your partner relationships. And this is exactly where Vector can help. 

With Vector’s software, you can digitize your forms and create custom workflows. This can optimize communication, making it easier for your team to share important shipping data. Vector can also help you reduce your reliance on paper and ensure that important shipping documents reach their target destinations on time.

What’s not to like?

To learn how Vector can help your business transform its shipping documentation processes, request a free trial today.

This post was written by Justin Reynolds. Justin is a freelance writer who enjoys telling stories about how technology, science, and creativity can help workers be more productive. In his spare time, he likes seeing or playing live music, hiking, and traveling.

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