How EDI ASNs Enable Direct Store Delivery (DSD)
In the highly competitive retail market it is vital that there is always stock on-hand to meet consumer demand. The direct store delivery (DSD) model, which is seeing increasing adoption, enables a retailer to order goods for delivery directly to its stores, bypassing the retailer’s distribution centers and thereby shortening delivery time. This is especially important for perishable items, such as fresh produce and bread, when delays in shipment may mean shorter shelf life. It is also heavily used for items purchased on impulse, such as sodas, wine, snacks and crackers. The use of electronic communications between the retailer and its DSD suppliers helps ensure the smooth flow of accurate and timely data along with fast product delivery leading to an overall efficient DSD process.
So, what is the role of the ASN in the DSD process and how does it help?
Let’s use the example of a soda company that delivers pallets of soda to its retailers using DSD processes.
First, the soda vendor picks an order at its warehouse and prepares the pallets for shipment. Next, the vendor affixes a UCC-128 barcode to the pallet. This is a code that provides information about the items, quantities on each pallet, as well as the number of pallets to be delivered. Then the soda vendor sends an ASN document containing the details of the shipment – including all the data from the barcode – to the retailer’s headquarters business system.
Headquarters immediately forwards the ASN to the specific stores, enabling the stores’ receiving systems to “know” about the deliveries in advance of their arrival. Use of the ASN is ideal for vendors whose goods are not highly perishable, are shipped in full cases and can be pre-ordered. (The ASN is not used in “spot-sale” DSD scenarios in which the truck driver for the DSD vendor has inventory on the truck and determines what merchandise needs replenishment based on what’s left on the store shelf.)
The use of the ASN streamlines the efficiency and accuracy of the receiving process at the retailer’s back door. Instead of having highly-paid, hourly employees perform a slow, error-prone, manual check-in process in which they verify the quantities of items received, identify any discrepancies and record them, the receiver can simply scan the barcode on each pallet and confirm that it matches the ASN. This reduction of receiving time by as much as 60%, according to a study by the Grocery Manufacturers Association, “Unleashing the Power of DSD,” is a win/win for both the retailer and the DSD vendor. Now, the goods can be delivered to the store shelf much faster than ever. This in turn provides better customer service, reduces the likelihood of lost sales due to stock-out and increases turnover. That means more revenue for both.
So, how do you optimize ASN’s and DSD?
- Electronic Purchase Order Collaboration – enable 100% of DSD vendors or distributors to receive electronic purchase orders. Large companies may be enabled via traditional EDI, while small and medium-size businesses may be enabled using other technologies, like web forms.
- Advance Ship Notice (ASN) and Bar Code Labels – enable 100% of DSD vendors or distributors with the capabilities to send ASNs via EDI or web forms. Look for solutions that also allow you to generate and print the bar code labels for shipments.
- Data Quality Management – The ASN is one of the most complex supply-chain EDI transactions. Look for a service that includes configurable rules that can ensure that every message is validated for both standard- and customer-specific information.
Click here to learn more about how to optimize Drop-Ship, Cross-Docking, DSD, and other supply chain processes.