Most distribution companies are faced with delays in delivering and receiving merchandise and the acceptance of shipments. There are many reasons for these delays, starting from employee’s efficiency and not ending with an ineffective system of storage of goods within the warehouse and lack of technology tools. Any insignificant factor in the functioning of the warehouse can bring significant losses to the business and excessive workload for personnel, it will certainly affect operating costs.
In this article, we will tell you how to optimize and speed up the warehouse using electronic data Interchange
Warehouse management issues
How quickly the warehouse starts picking an order received from an ERP– depends on the internal business process in an organization.
There are situations where orders received before 12:00 noon are shipped in the same day, and all other orders – only the next morning.
There are companies whose warehouse business processes are built in such a way that it takes 2-3 days to process and ship one order.
If the company operates in the FMCG market, then the logistics should be very fast. For example, when delivering perishable goods such as fish and seafood, dairy products, fruit, and vegetables.
The time to receive and accept the goods also depends on the form in which the documents and related paperwork are presented.
Acceptance of goods from a large truck can take from one to three hours.
EDI can significantly reduce the processing time for goods acceptance documentation. Companies that have implemented and integrated EDI in their warehouse business processes realized a reduction in processing time of up to 90%.
Moreover, with large volumes of deliveries, there are other advantages of electronic data Interchange.
EDI transaction sets for the Supply Chain
In supply chains, the EDI 856 Advanced Ship Notice and EDI 861 Receiving Advice/Acceptance Certificate transaction sets are very commonly used. DESADV – Despatch advice message and RECADV – Receiving Advice Messages perform the same function in the EDIFACT standard.
An EDI 856 document contains information about the shipment and other detailed information:
- shipment id
- physical characteristics of the goods
- recipient and sender identifiers
- transportation information.
When receiving an 856 EDI document, the recipient does not need to enter data manually. Product information may automatically flow into the accounting business system. Advanced Ship Notice helps to prepare for acceptance. Even before the arrival of the supplier’s truck, the buyer already has a list of goods shipped, integrated into his own system.
The response to the EDI 856 document, to confirms the acceptance of the goods, is EDI 861. The Receiving Advice is transmitted from the buyer to the supplier. EDI 861 indicates the list of goods received or not received, accepted or not accepted, as well as other accompanying information.
EDI improves the accuracy of work with deliveries and reduces the number of human errors when processing documents in the warehouse. Since the data comes even before goods delivery, it is possible to arrange a schedule so that unloading begins immediately after the arrival of the goods.
Using SSCC codes, is a companion to the EDI 856 transaction, which makes it possible to mobile scanners to automatically read information on the contents of pallets, regardless of the number of assortments.
EDI Integration for Warehouse and Supply Chain
For suppliers working with retailers and other distributors, it is possible to use both of EDI2XML offerings: EDI web service that allows to send and receive EDI 856 /861, as well as the fully managed EDI solution…
Integration of EDI with accounting /warehouse business system is importantly relevant, when a huge number of transactions is being processed daily; it will help accelerate the work at the warehouse.