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EDI Improvements for Public Warehousing and Third Party Logistics
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Medium sized manufacturers and importers are beginning to require automation just as larger ones did a few years ago. They require shipment, replenishment, and inventory information be automated and updated daily. Third Party Logistics providers (3PL) can use labor intensive web forms or automated EDI as replacements for phone, fax, and e-mail communication.
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Automation allows capping head counts and re-focusing staff on other challenges.
Overview
Large American companies want you to move goods as quickly as if they were stored in their own warehouse. You need to ship, inventory, and replenish promptly and accurately. This means routine, high volume communication should be automated using the same processes as current EDI.
There is a solution, which mirrors existing practices and reduces the challenge from FedEx and UPS.
- For shipments, a Shipping Order (940) is sent.
- For inventory management, cycle counts and adjustments are received (947).
- For replenishment of stock a Shipment Advice (943) is sent, which alerts the warehouse to be ready.
- Secure Internet data transmission using EDI INT AS2 or FTP over your VPN.
- Transport EDI 200 series such as Shipment Statuses (214) to you and your customers.
Since warehouses already monitor shipments and stock closely, automation of the process will build upon existing processes. The benefits accrue to both parties. The cost of the second and subsequent trading partners is much smaller.
Greater accuracy results when the data received from customers is processes without manual entry. The return from greater accuracy is challenging to calculate, but a good first step is to measure re-work time. The cost savings due to elimination of data entry labor is easier. Finally, the wider shipping window resulting from data being in the system at the start of the day also provides a competitive advantage.
Automation may not include all pieces for every shipper and carrier due to their system constraints. For example, some may continue to use a web form to enter manifest information and require the Inventory Advice (947) to be sent by EDI. Non-routine tasks such as expediting are likely to remain manual (phone, fax, or e-mail) due to the need to check capability.
Here is an overview of a routine data flow for Logistics:
From a Manufacturer's perspective.
From a Public Warehouse's perspective.
Another effective use of EDI is to automate Accounts Payables.
Conclusion
Your business is unique, so alignment of your time tested methods needs to be done carefully and may require expert assistance. The first step is to set a team to highlight the benefits to each organization. Second, our DCS Process™ means your improvement will be thorough and economical.
DCS is ready to help you capture a larger share of the market and reduce cost. For example, Change Orders that arrive quickly and without error are truly beneficial. Other significant saving come from fewer:
- Costly last minute order changes
- Disrupting expedited shipments
- Surprise deductions from your invoices
Your next step is to email us for a Free Assessment.
For more in depth information:
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