Also called advance shipping notice or advanced ship notice, advanced shipping notification (ASN) is a shipment message sent online as electronic data interchange (EDI 856) by an external supplier to a customer. It can be considered a “modernized” bill of lading. The message indicates the goods have been shipped and are enroute. An ASN is usually sent as soon as the order is shipped, so that the recipient has sufficient time to plan shipment receipt, storage and transportation. ASN is also known as despatch advice (DESADV) and outbound ship notice.
The details in an ASN include the shipment’s likely arrival date, packaging, lot number, purchase order (PO) number, stock keeping unit (SKU) number, container or pallet number, carton number, quantity, mode of transportation and/or carrier information. The particulars could vary and usually depend on the kind of information the shipment recipient and sender want included. An ASN can also comprise billing details, such as tax information and invoice.
Primarily a B2B communication, consumers shopping retail online also receive order status email messages from the retailer, along with detailed delivery status. In case of retail orders, there is no EDI involved. The shipment communication is primarily through webmails. By the way, an ASN and invoice are not the same. ASNs are usually sent before the invoice. An invoice is sent with the shipment or electronically after order receipt.
Transmission and Receipt
As aforementioned, an ASN is sent via EDI. The shipment message can be faxed too, but that’s rare. Once the recipient receives the ASN, the ASN gets uploaded into the warehouse management system (WMS) software of the client. The warehouse management system (WMS) or the transportation management system (TMS) usually receives and processes the ASN file. The shipment can be received at a distribution center, warehouse or store.
To make life easier for the client, the supplier can put barcodes on all the shipped boxes, cases and crates and add that information to the ASN. Upon shipment receipt, the customer employs barcode scanning to check the shipment carton’s serial shipping container code (SSCC) against the ASN file for accuracy. This helps the recipient identify the supplier, related purchase order and expected contents. Any missing or unexpected item is marked on the over, short, and damaged (OS&D) report, which is later forwarded to the purchasing department.
To make sure the same carton hasn’t been received before, the particular purchase order in the inventory system is pulled out. There could be times when the items may match with a previously received order but the SSCC would not. In such cases, the shipment is considered unique. To confirm receipt, a pick label is applied to the carton (manually or automated). The carton is then quickly loaded onto outbound trucks for their final destination, which could be a retail store, warehouse or manufacturing plant.
ASN-based shipping and receiving practices facilitate quick and accurate unloading of shipment, and also help with efficient sorting and management of inventory. When inspecting shipment, the ASN data is used to confirm delivery of all units. With manual receiving, there are chances of the clerk confusing variants of similarly titled items. Not to mention, the time consumed. Also, manual inputting errors could happen at the vendor’s side.
ASN makes it quite easy to find out discrepancies (if any) between the order placed and the shipment received. Both the supplier and the client know each shipment’s contents. This means missing cartons can be tracked easily and the claims can be made accordingly. For the vendor, being able to provide shipment information in advance and also expedite replacements (if any) enhances customer satisfaction, resulting in more future engagements with the client.
ASN offer several supply chain and logistics benefits. It helps with accurate and timely shipping. In other words, when the warehouse personnel on the receiving end knows what shipments are expected to arrive in the next few days, they would be able to arrange outbound transportation in advance for every incoming load. This also means fewer stock-out scenarios, missed delivery schedules and order errors.
With the emergence of just-in-time (JIT), lean manufacturing and cross-docking, modern businesses are now opting to carry lower safety stocks. This means the supply chain needs the goods to arrive within scheduled time frames. Marketing activities, product deliveries or production schedules cannot be executed as per plan without crystal-clear clarity about a shipment’s expected arrival dates and locations. The earlier practice of loading up stocks in the warehouse reduced ‘out-of-stock’ risks, but it increased inventory costs that showed up on balance sheets.
ASN doesn’t work in isolation. For it to work effectively, RFID system or barcode scanning should be participants. This also means vendors and carriers should be cooperative. In other words, every supply chain link should be ASN-capable. Generally, the bigger suppliers with modern and more advanced systems tend to get the ASN game right more often than the smaller firms. The smaller companies usually adopt ASN as web forms and not via traditional EDI.
Accuracy is another major challenge. The common errors with ASN are line or header errors, item quantity mismatch, etc. Inaccurate ASN data would lead to delays, decreased or lost productivity, etc. If there are errors or discrepancies in ASN, the client can intimate the vendor about it. The message seeking corrections to the ASN is referred to as application advice. The vendor then peruses the application advice and sends a cancellation ASN, which is then followed by a new or corrected ASN.
ASN accuracy can vary between multiple shipments from the same vendor, and also the checking system used by the recipient. Proper supplier training is mandatory for ASN information to be accurate, on-time and complete. Thanks to this complexity, most firms associate with an external company for help with ASN. An experienced B2B service provider usually has an established network of trading partners. This means complete trading partner involvement in the process and seamless processing is almost a given.