This post was updated to reflect current trends and information.
What is EDI 846 document?
One of the most important electronic EDI documents heavily exchanged between trading partners, is the 846 X12 document. It is important mainly due to the evolution of the drop-shipping business that saw a great advancement in the last few years, because of eCommerce and online sales.
This EDI document originates from the paper-based “inventory inquiry and advice”. Basically, it is a notification sent by the manufacturer to the seller, advising about stock status and availability. It can include also pricing information. In other words, this EDI message is to exchange information about stock levels and the availability of goods.
For e-commerce, it is very important to have up-to-date information about the availability of goods. That is why one of the major EDI requirements for Amazon, is the capability of the supplier to transmit an EDI 846 Inventory Inquiry message. This is not only a requirement for Amazon exclusively; Other leading retailers such as Cabela’s, Wal-Mart, Costco … all have the same EDI requirement, to be able to feed their eCommerce platform with quality inventory status information.
The EDI 846 document can be sent to business partners, as many times as necessary. It can be 2-3 times a week, up to several times a day; each retailer has his own requirements. EDI 846 Inventory Inquiry/Advice permit to suppliers to provide trading partner information about their products without forcing to make a purchase. In addition, the EDI 846 transaction often used to notify the business partners about the availability of goods at discounted prices.
EDI 846 Inventory Inquiry and Advice usage
The other obvious question about 846: who uses this EDI 846 message other than Amazon and the major eCommerce retailers?
The truth is that not only eCommerce retailers can use this EDI transaction and exchange 846 documents. All trading partners can agree to use it to exchange inventory availability and stock level. Some examples:
- sellers to provide inventory information to a potential customer
- seller’s representatives to supply the seller with inventory information
- one seller’s location to give another location inventory information
- seller to demand the availability of inventory
What information this X12 document transmits?
In the EDI 846 transmission, inventory location identification, item and part description and quantity, are the basic information included in almost any EDI 846 document; however, additional information can be added such as:
- Quantity forecasted
- Quantity sold already
- Quantity available in stock
- Pricing information
With EDI 846 online stores optimize their deliveries. They do not need to enter data manually into their internal systems, such as ERP or back-office of their stores. It gives an accurate information to online shoppers about availability of stock, in a real-time mode. Moreover, it does reduce the administration fees and expenses to process orders and items bought by consumers, while having no stock.