Which EDI Electronic Documents Interchange Transactions can help Your Business in the course of COVID 19?
Are you an EDI (Electronic Data Interchange) user? An Electronic Data Interchange is a business concept to communicate information electronically (like the traditional orders and invoices in paper).
In this article, you will find pointers for your business continuity as we combat COVID 19.
EDI Purchase Order – 850 –In today’s fast-evolving world, a slow purchase order process can paralyze your business. Having an old school process in a modern world of technology may do more harm than good as most of the time, it is inefficient and time-consuming.
I highly recommend this Purchase Order transaction with a drop-ship routine for your supply chain. What is drop-shipping? An easy illustration is, it is the delivery of the purchased products directly to the buyer from the manufacturer, not passing the suppliers receiving dock. Drop-ship will eliminate moving on supplies from the freight carriers to the distributor’s truck and then again to the warehouse. This purchase order is trendy now with e-Commerce businesses.
It does an electronic order that transmits to the manufacturer’s ERP (Enterprise Resource Planning) system, which fills the prescription with limited labor requirements and without missing any steps. Also, enabling drop-ships through your EDI system will ship the product directly to the distributor’s warehouse. With that said, it will fulfill the delivery while reducing touchpoint and labor requirements.
2. EDI Ship Notice/ Manifest Document – 856 – Ship Notice Advice intends to make the process of receiving items easier. It comprises detailed information about product shipped quantity, tracking numbers, freight carrier name, ship/deliver dates, and product packaging information. This system will help you organize your shipments or deliveries. The primary purpose of this process is for receiving and inventory control.
It will start with the Purchase Order 850 process, and to confirm the supplier sends an Acknowledgement (855 – Transaction set), process the order, then proceeds with Ship Notice/Manifest.
Having this will give you time in advance to manage workflows for those who receive deliveries and for them to schedule effectively. It will stop delivery trucks from showing up at the same time in your warehouse, and will reduce the need for assistance in the delivery process. Less interaction with people will lessen the worry of virus transmission.
This Advance Ship Notice (ASN) can also minimize the time in receiving inventory in seconds via the integration of the GS1-128 shipping container barcode and or the GTIN product package barcode. By scanning the barcodes, items received will show as received to the inventory system in seconds. Partial exclusion of manual processing will reduce human errors. And you do not need to spend time encoding each item to your Inventory management system.
3. EDI Payment Order/Remittance Advice Document – 820 – Payment order works electronically, used when an open or pending account needs to be settled, or advise of the details or adjustments in payment. Also sent to a supplier when making payment via an electronic funds transfer or online payment.
This process is not limited to just Fund Transfers or any money movement, and it includes both treasury and accounting functions. You will save time and lessen the need for employees in the Accounting process (Accounts payable and Receivable) to balance the invoices. Recon ciliation can be done swiftly in no time. It follows Social Distancing, one key not to be infected.
With the changes ongoing right now, I will recommend the EDI system. Starting with the cost-saving as it is paperless, Its speed and accuracy, and for business efficiency. Such a big help for your company operation as we face COVID 19! Also perfect for any future business modification. Some are already using EDI and these Purchase Order 850, EDI Advance Ship Notice 856, and Payment/Remittance Advice Document 820 I highly recommend for you to add. The automation it offers will help you a lot cut the labor requirements, cost, and safest way to beat COVID 19 while we still have ROI ( Return of Investment).
I would be glad to hear your success stories upon reading this article. Let me know how EDI processes streamlined your business.