Drop Shipping and EDI

Drop shipping is a supply chain management technique in which the retailer does not stock or take possession of the goods, but instead transfers customer orders and shipment details to either the manufacturer or wholesaler direct. It is the manufacturer or wholesaler who then ships the goods directly to the customer.

Some drop shipping retailers may have example ‘not for resale’ items in store, so that customers can inspect an item similar to those that they can purchase. Other retailers may provide only a catalogue or online listing of their products e.g. Amazon.

Drop shipping reduces inventory, warehousing, packaging, labor and shipping costs for retailers by enabling them to pass orders and ship to information along to the manufacturer or wholesaler direct. EDI can help drop ship trading partners, by not alone providing integrated order, invoicing  and shipping solutions, but by also providing the EDI 846 transaction set otherwise known as the Inventory Inquiry/Advice (INVRPT in EDIFACT). The EDI 846 is used by manufacturers and wholesalers to notify retailers and trading partners of stock and inventory levels so that the retailer doesn’t commit to sales where not enough stock is available.

For further information on how you can use B2BGateway’s EDI solutions to further automate your drop shipping requirements please call (401) 491 9595 or email Sales@B2BGateway.Net

What is an ASN?

An ASN (Advance Ship Notice) is an electronic document that provides a detailed notification of a pending delivery. It is a commonly used EDI transaction set known as the EDI 856 under the ANSI X12 standards or the DESADV (Despatch Advice) under EDIFACT standards. The purpose of an ASN is to notify the customer when shipping occurs and provide physical characteristics about the shipment so the customer can be prepared to accept delivery to their warehouse or store.  

The ASN which ties back to the original Purchase Order (PO) sent can be used to list the contents of a shipment of goods as well as additional information such as when an order will be shipped, which items are being shipped, how many of each item is being shipped and physical characteristics about the shipment such as the shipment’s weight, the number of boxes and a description of how the shipment units are packaged. An ASN also tells the customer which mode of transportation is being used for shipping and provides carrier information.

Retailers have found that having an ASN requirement as part of their overall EDI compliance structure leads to greater accuracy, greater flexibility and an overall reduction in costs.

If you would like to know more about the ASN and how B2BGateway can help you implement this EDI transaction set please call (401) 491 9595 or email Sales@B2BGateway.Net

EDI 846 - Inventory Updates

An EDI 846 transaction set (EDIFACT: INVRPT) is an inventory inquiry/advice or an electronic version of inventory update. It is used by trading partners to communicate inventory levels and whether there is enough stock of goods on hand to be sold electronically. It has become particularly important for online retailers such as Amazon to have this information at hand, particularly when drop shipping. Online retailers cannot reliably offer goods to consumers without having up to date information regarding a supplier’s inventory of goods.

 

EDI can help solve this problem through the EDI 846 transaction set and most large online retailers now insist that their suppliers are capable of sending them the EDI 846 transaction set. The EDI 846 can be sent multiple times a day or a few times a week depending on the needs of the trading partners. Typically an EDI 846 transaction set includes:

·         Inventory Amount

·         Committed Inventory

·         Quantity On Order

·         Backorder quantity

·         Inventory in transit

·         Returns

 

The EDI 846 transaction set can be used in the following ways:

(1) The seller of goods and services can provide inventory information to a prospective purchaser, with no obligation to the purchaser to acquire these goods.

(2) A representative of a seller of goods can supply inventory information to that seller

(3) For one location to supply another location with up to date inventory information

(4) An inquiry as to the availability of inventory or stock with no obligation on the seller of the goods to reserve that inventory.

For further information on how B2BGateway can help your organization set up and handle the EDI 846 inventory update with your trading partners please call our sales team today on (401) 491 9595 or email Sales@B2BGateway.Net  

Louisa Gooding is Director of Sales & Marketing at B2BGateway.Net