What you will learn from the e-book

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2 What yo will learn from the e-book 1. What is an Advance Ship Notice? 2. Benefits 3. Challenges 4. Implementing Vendor ASN 5. Bsiness Scenarios for ASN Distribtion Centre Cross-Docking Distribtion Centre Receiving & Pt-away E-commerce Dropship Direct Store Delivery Third Party Logistics ASN Import ASN Evalated Receipt Settlement Spice Technology Grop, Inc. 2

3 What is an Advance Ship Notice? ASNs are effectively electronic packing slips that are transmitted by a spplier/shipper and received by yo in advance of the shipment. It digitally follows the physical shipment from sorce-to-shelf. Spplier electronic ASNs are accompanied by physical barcode labels attached to corresponding cartons/pallets that act as license plates for inbond goods by matching them electronically to detailed shipping information residing in ASNs and POs. Electronic ASNs provide a lot of essential detail abot the physical shipment and often adhere to the SOPI strctre: shipment, order, pallet and item level information provided. This information is valable not only to the receiving location, sch as Distribtion Centre (DC), bt also to the final destination sch as a store or forward stocking location or to an end consmer for drop-ship e-commerce. Spice Technology Grop, Inc. 3

4 Benefits of EDI Vendor ASNs 1. Inbond inventory visibility: what is coming in from the vendor, when and how is it packed. What is in each carton and pallet. 2. Atomated Receiving : single scan of UCC-128 bar-code to receive and pdate PO; significant effort redction at DC/Store receiving area 3. Atomated X-Dock: fll tilization of mechanization systems within DC for sorting and x-docking; redction of DC inventory from flow throgh inventory 4. Labor schedling: optimized part time/fll time/ seasonal labor schedling plan at DC based on inbond visibility 5. Eliminate invoice process by adoption of Evalated Receipts Settlement (ERS) 6. Provide end-to-end shipment stats tracking capability, inclding for vendor dropship to store and to consmer 7. Redce inventory throghot system withot negatively affecting in-stock and DC service levels to stores or e-commerce flfillment; ASNs enable redctions in lead times and reqired safety stock, thereby lowering overall system inventory. Spice Technology Grop, Inc. 4

5 Challenges in Adopting a Vendor ASN program Yo need a fnctioning W MS in order to flly tilize and captre benefits from a vendor ASN Vendors may not be ready to implement an EDI ASN de to technical limitations; Web EDI soltions vendors are often sed to sccessflly overcome this problem ASNs shold be tied to data from original EDI prchase orders. Standalone ASNs have been tried and provide limited sccess de to data errors Most vendors have to be onboarded for EDI ASNs in order for yo to captre sbstantial benefits; vendor EDI onboarding can be a resorce intensive task and is sally otsorced to firms that provide EDI onboarding managed services Spice Technology Grop, Inc. 5

6 Vendor ASN Implementation Best Practice 1. Develop an excellent nderstanding of the desired benefits from a frictionless inbond logistics program; develop ASN bsiness and technical specifications based on driving these benefits 2. Ensre that WMS and ERP are set p to accommodate ASN data, inclding having scan-receiving capability at DC or Store 3. Develop or expand EDI program to accommodate vendor ASNs 4. Vendor compliance Develop a vendor compliance program, with chargebacks associated to non-compliance to ASN service levels Develop and commnicate vendor scorecards to vendor base to keep them apprised of overall spply chain exection performance level 5. Ensre that vendors adopt a standard EDI ASN, based on yor reqirements; avoid cstomizing EDI ASNs for each spplier trading partner 6. Utilize a pilot + big bang approach to rollot ot ASNs; ensre that all spply chain stakeholders have a change management program in place to transition from manal to atomated inbond receiving Spice Technology Grop, Inc. 6

7 Bsiness Scenarios for ASN Distribtion Centre Cross-Docking Cross docking is a process in which prodct is received in a facility, occasionally combined with other pallets bond for the same destination and then shipped as soon as possible. Cross docking reqires advance knowledge of the inbond prodct, its final destination (sch as a store or factory), and a system of roting the prodct to the proper otbond vehicle The Advance Ship Notice provides the advance knowledge of the inbond prodct which is key to a sccessfl cross-docking program Spice Technology Grop, Inc. 7

8 Bsiness Scenarios for ASN Distribtion Centre Receiving & Atomated Pt-away Sophisticated warehose management software (WMS) systems have the ability to atomatically assign storage locations from an advanced shipment notice (ASN) or pon receipt to the dock. Atomated conveyor systems that are capable of sorting and diverting materials by zone and location can optimize the direct pt-away process. ASNs provide vital information to atomate the receiving and pt-away process in sch warehoses Spice Technology Grop, Inc. 8

9 Bsiness Scenarios for ASN Vendor Drop-Ship to Store and End Cstomer In Retail, E-Commerce and other endcstomer oriented indstries, it is common practice to have vendors dropship ecommerce orders or items ot-of-stock in store, directly to the end cstomer. Certain items are also ordered as Direct-StoreDelivery (DSD), the central distribtion centres. Vendor ASNs provide vital inbond visibility to the store and/or the consmer. ASNs for ecommerce orders also carry the corier s shipment tracking code, which is reqired for overall shipment tracking (sch as from within the e-commerce site) Spice Technology Grop, Inc. 9

10 Bsiness Scenarios for ASN Third Party Logistics (3PL) ASN Logistics providers are often asked by manfactrers to not only act as contract logistics providers for otbond shipments bt to also generate and transmit ASNs on their behalf to final recipients of the prodct. This reqires the 3PL organization to manage original order data in a complex EDI integration scenario with their manfactrer cstomer. Spice Technology Grop, Inc. 10

11 Bsiness Scenarios for ASN Evalated Receipts Settlement (ERS) Evalated Receipt Settlement (ERS) prodces an atomated payment to vendors on sccessfl receipt of ordered prodct, withot reqiring for a paper or EDI invoice from the vendor. When the spplier shipment is received by the Warehose Management System, a corresponding goods receipt is raised within the ERP/Inventory Management system. An atomated payment is then generated for the received prodct, based on price and terms within the prchase order. A payment notice is sally sent to the vendor via an EDI 820 Remittance Advise message. ERS reqires that the receiving party (e.g. a retailer or manfactrer receiving prodct from sppliers) maintains accrate item data in their prchasing system. This is sally achieved by implementing an atomated and integrated item listing and item cost management process. Sch a listing management process, in trn, is facilitated by specialized new prodct listing management systems and centralized and atomated electronic cataloge sbmissions by vendors, sing EDI 832, vendor portals and other means. Spice Technology Grop, Inc. 11

12 Contact Us 5045 Orbitor Drive, Mississaga, ON L4W 4Y Spice Technology Grop, Inc. 12