Debate continues about whether the ASN is of enough value that it deserves being supported. In my findings, the ASN is probably the single most important document in the supply chain process. ROI for the ASN is estimated from $5 when used for simple confirmation purposes to as much as $50 when used for visibility and automated receiving. All EDI transactions have their individual ROI, however most do not have the scope of impact on multiple departments that the ASN has. Below are typical values -
Ecommerce (Drop ship) –
- Customer Service – In the world of Ecommerce it’s essential that Retailers know that a customer’s order has been shipped by the supplier. This is done through the Confirmation ASN that a supplier would provide to the retailer indicating date of shipment, Carrier of record, Carrier assigned Tracking number, Ship From location, PO number and Item shipped. Many retailers will email the information from the ASN as part of the shipment notification alert. Having the tracking number allows for Proof of Delivery research that is needed when customers indicate non-delivery of the billed orders.
- Accounts Payable –In some cases, retailers may have an agreement with the supplier that the receipt of the ASN will include the supplier's invoice number, and adds the supplier's invoice number to their Accounts Payable system. Thus no electronic invoice (similar to Evaluated Receipt Settlement) is required. In this situation the retailer pays as indicated on the Contract PO between the two companies.
- Customer Billing - Many retailers will use the receipt of the ASN Confirmation to trigger the billing of the customer’s account for the shipment instead of waiting for the vendor's invoice. In many cases these companies gain a day or two of float between when the customer is billed and vendor is paid.
DC/Store –
- Customer Service – The inbound ASN to a Store or DC provides visibility of anticipated delivery of orders in cases in which the retailer has backorders with their customers. Having this visibility allows the retailer to provide updates for customers' orders about whether an item is available or backordered on the Retailer's website at the point of initial order.
- Accounts Payable – Through the act of the supplier creating the ASN data as the shipment is packed, AP departments are seeing accuracy improvements between what is shipped and what is invoiced. Some statistics show up to 90% improvement for some suppliers. The explanation that I’ve heard is that suppliers asked to create ASNs are scanning the products as they are being packed, and that this process is actually a double check of what was picked.
- Merchandise Operations - The ASN provides the buyer advance notice of when a given order has been shipped, and what part of the order is included in the shipment. This reduces the need for the buyer to contact the supplier regarding status of their orders/Shipment. For those products that are in high demand, buyers are using the ASN information to pre-allocate shipments to Stores before the merchandise arrives at the DC (many refer to this process as Post-Distro)
- Warehouse/Store Operations
o Inbound Shipment visibility – Having advanced notification of an inbound shipment for the warehouse and store staff allows for preparation for the loads inbound and the staff needed to unload the shipments.
o Automated receiving – The quality of packed shipments trickles down to the value to the DC and Stores, and as a result, have allowed companies to automate the scan at receiving time. Many have RF systems that scan the GS1-128 barcode which then picks up the Carton or Pallet ID that was included in the ASN data, and updates the inventory receiving and PO records with the item quantities directly from the receiving docks. To ensure that the accuracy of the ASN data remains consistent, many retailers will continue to conduct sporadic shipment audits. Companies like Target use Certification levels for each supplier GOLD, SILVER or BRONZE which determines how often a given supplier shipment will be pulled for a manual audit. This automation changes the time that it takes the unloading of trailers through to Put-away or outbound flow through to the shipping dock from hours to minutes.
- Vendor Compliance
o Vendor Scorecard – Because most retailers rely so much on the ASN information for automating the receipt shipments for DC and Store orders, it is imperative that the information is accurate. To ensure that accuracy, retailers are now including the receipt of the ASN and the quality of the information regarding the actual shipment as significant factors of the vendor's scorecard. Many strictly use the ASN for shipment to order validation, however others compare the ASN data to the physical count of a shipment.
With the growth of Ecommerce, many retailers (and suppliers) are using 3rd Party Logistic companies to fulfill orders. With the increased volume that is now being handled, these 3 PL’s and 4 PL’s are now seeing the need to exchange ASN data with their trading partners, or their trading partners trading partners, in order to properly manage these shipments. Whether that is a Retailer receiving and forwarding ASN or Flat Files in preparation of a shipment, or direct delivery of the data to the 3PL, it is almost a requirement for doing business.
