Advance Shipping Notice — Everything You Should Know

As a procurement professional, you might have heard of a document called “Advanced Shipping Notice”. But what is it and what role does it play in an organization’s procurement process?

For this article, we will look into what an Advance Shipping Notice is, including its contents, who issues it, and the purpose of it.

After reading this article, you will have a better understanding of Advance Shipping notice and how it can be utilized to streamline and improve your organization’s procurement process and supply chain.

But before starting to read the article, I have created a free-to-download editable sourcing calendar template. It’s a PowerPoint file, together with an Excel file, that can help you stay on top of your deadlines and ensure your goods arrive on time. I even created a video where I’ll explain how you can use this template.

Whatis Advance Shipping Notice?

An Advance Shipping notice, also known as ASN, is a document or electronic message which shall provide complete details on the current shipment of goods. This is to notify the seller or supplier of the content of a consignment before it reaches its destination. An ASN also tells the buyer which mode of transportation is being used for shipping and provides carrier information.

It is a notification of a delivery that is upcoming and is most commonly sent electronically via EDI (Electronic Data Interchange). This information should normally be forwarded by suppliers or sellers to buyers or retailers and is often requested by the buyer as part of its trading or EDI requirements.

ASNs are an integral part of the supply chain operation, and they can often be applied to inventory management, warehousing, or retailing operations.

What Information Is Includedin the Advance Shipping Notice?

An Advance Shipping Notice not only notifies the buyer when the shipment will arrive but also provides additional details that will help the buyer to prepare for receiving the shipment. Allowing for a reduced cost in the receiving process.

Such contents of an Advance Shipping Notice vary from supplier but it typically contains information such as:

1. Order Information

A minimum number or reference to the purchase order should be provided.

2. Shipment Details

Information on the shipment, including the tracking number, the dispatch date, and the carrier or mode of transportation used.

3. Delivery Details

The expected delivery date, the shipping destination address, and any special delivery instructions.

4. Packaging Information

Information regarding the products’ packaging, including the number of cartons or pallets, as well as the weights and sizes of each.

5. Product Information

A comprehensive list of the products included in the shipment, including product names, descriptions, quantities, and occasionally the weight and dimensions of each item.

6. Order References

The recipient can link the ASN with the original order by referring to the corresponding sales order or purchase order numbers.

Advance Shipping Notice Process 

For an effective use of an Advance Shipping Notice, the step by step process is recommended:

1. Order Initiation

When the buyer initiates a purchase order, the process starts. The goods are then selected, packaged, and labeled in accordance with the buyer’s criteria and requirements by the seller or supplier in order to get the cargo ready for distribution.

2. ASN Creation

The supplier creates the Advance Shipping Notice (ASN) after the order is ready. A complete description of the shipment is included in this document, together with information on the products, their quantities, their packing, their dates of shipment and expected delivery, their carriers, and any specific instructions for the recipient.

3. ASN Transmission

To the buyer or merchant, the supplier electronically provides the ASN. ASNs can be transmitted by Electronic Data Interchange (EDI), XML, or other electronic messaging platforms, depending on the degree of integration between business partners. ASNs can also be sent by some providers via email or web portals.

4. ASN Validation

The buyer’s or retailer’s system verifies the information after getting the ASN to make sure it is accurate and comprehensive. To ensure that the shipping details match the order, the system compares the ASN with the associated purchase order and other pertinent data.

5. Receipt Acknowledgement

The buyer’s system notifies the supplier that the ASN has been received by sending an acknowledgment back to the provider. Establishing a two-way communication line and making sure both sides are aware that the information has been received require this step.

6. Receiving Preparation

The receiving party (buyer or store) can get ready for the shipment’s arrival once they have the ASN in their possession. They can schedule employees, allot warehouse space, and make plans for unloading and inspection. The ASN data contributes to the receiving process’s simplification, reducing delays and enhancing operational effectiveness.

7. Shipment Arrival

The receiving party checks the contents of the shipment against the ASN data when it reaches its destination. Physically examining the goods, amounts, and packaging to make sure they correspond to the ASN’s information is required.

8. Receipt Confirmation

The receiving party sends a confirmation to the supplier when the verification procedure is finished to show that the shipment has been successfully received and accepted. Any discrepancies about the shipment should be communicated.

Benefitsof Advance Shipping Notice

We defined what an RFx is and provided its process flow. Now it’s time to take a look at its various types. There are many types of RFxs, but here are the three main types used in the procurement process.

1. Inventory Management

With the aid of ASNs, the receiving party may precisely match up inbound shipments with their purchase orders or inventory records. Better inventory management is made possible by this real-time knowledge, lowering the possibility of stockouts or overstock conditions.

2. Order Visibility

All parties involved have immediate access to real-time information regarding the status and location of the items thanks to ASNs, which provide advanced information about upcoming shipments. Through the supply chain, better planning and decision-making are made possible thanks to this increased visibility.

3. Reduced errors

ASNs offer a thorough record of the shipment, lessening the possibility of mistakes and irregularities in the products received. Any differences can be quickly resolved with the provider, minimizing business interruptions.

4. Cost Optimization

The cost of transportation and logistics can be reduced if procurement teams have better visibility into the shipment specifics. Based on the quantity and timing of incoming goods, they can consolidate shipments, select affordable transportation options, and bargain better terms with carriers.

5. Improved communication and collaboration

ASNs help suppliers and buyers collaborate and communicate more effectively. Suppliers can alert buyers in advance of probable delays or other problems, enabling procurement teams to plan and make educated decisions.

Software Tools to ManageAdvance Shipping Notice

Managing Advance Shipping Notice is a lot easier thanks to software tools available that provides Advance Shipping Notice service. Here are software tools for managing your ASN

1. Odoo Inventory

Odoo is a suite of open-source business apps that cover all your company needs: CRM, eCommerce, accounting, inventory, point of sale, project management, etc.

2. LogiNext Solutions

LogiNext helps automate your operations to help with real-time tracking, route optimization, transportation, and logistics management software. Providing seamless and almost-instant integration with all enterprise resource planning suites across the board such as warehousing, order planning, transport management, payment, mapping, and more.

3. Cleo

Cleo provides an integration platform that automates all API, EDI, & non-EDI transactions and gains end-to-end visibility.

Conclusion

Advance Shipping Notice (ASN) clears up its pivotal role in procurement and supply chain management. By defining ASN and delving into its contents, issuance, and purpose, the article ensures a thorough understanding for procurement professionals.

The information-rich ASN not only notifies the buyer about upcoming shipments but also provides crucial details, optimizing the receiving process and reducing costs. The article walks through the ASN process, from order initiation to shipment arrival and receipt confirmation, emphasizing the benefits of improved inventory management, order visibility, error reduction, and cost optimization. Through the use of real-time data transmission, ASNs contribute to better decision-making and planning throughout the supply chain, minimizing the risks of stockouts or overstock conditions.

As procurement teams gain enhanced visibility into shipment specifics, they can strategically optimize transportation and logistics costs, ultimately streamlining the procurement process and bolstering operational effectiveness.