Data Requirements for Supply Chain Traceability and Visibility

by | Apr 3, 2020 | Order Management, Supply Chain

Let’s talk supply chain visibility. No one likes surprises, but they happen every day. Whether it’s a recall or simply a missing order, data is needed to inform retailers and suppliers about the product’s journey and its location.

If you are like me, I’d prefer to look up the data, find the order or batch, and respond to the urgent email right away. Scratching my head and spending the day hunting down the data isn’t an option.

Like most things in life, there is an easy way and a hard way. Let’s discuss the easy way to do supply chain visibility!

Achieving supply chain visibility or traceability

First, let’s define a few things. Supply chain traceability is used by most industries to ensure quality. They track the product from its origin (farm, factory, plant, etc.) through delivery to the consumer. When someone uses the term end-to-end traceability, they are usually referring to visibility to an order and its contents. This visibility is important to keep everyone informed and ease tensions across the supply chain.

So, what is the easy way to achieve end-to-end traceability or supply chain visibility? Let’s work our way through the process, starting with inventory updates and ending with the invoice.

Inventory updates prevent stockouts, mandated for drop-ship orders

The packages on our doorsteps tell us that direct-to-consumer, or drop-ship, order volumes are on the rise. Consumers love the convenience of this model and there is no turning back.

This order model increases the importance of sharing inventory information between retailers and suppliers. A retailer needs a daily inventory feed (or better) from its drop-ship suppliers, so they have visibility to the quantities available to sell to consumers.

Retailers can easily update items to reflect limited inventories, if informed. And, they can remove the item if it is out-of-stock. This visibility at the front-end prevents poor customer experiences and stress among supply chain partners.

Consumers don’t want to hear that their order is delayed due to an out-of-stock situation. So, inventory updates are usually mandatory for drop-ship orders, but retailers will often request them for orders shipped to their distribution centers as well.

Order confirmations communicate intent to fulfill

For years, retailers didn’t mandate or expect confirmations on purchase orders. Suppliers would communicate changes in delivery dates, item quantities and back orders through calls or emails. Or, just ship what they could. This is changing rapidly!

More and more, the Purchase Order Acknowledgment transaction is joining the purchase order, ASN and invoice as the standard transactions needed by retailers. The reason is supply chain visibility. This EDI document communicates a suppliers intent to fulfill the order. It conveys any changes to the original order well in advance. For items like apparel where orders are placed months in advance, this is a critical communication that should be sent as often as changes occur. We all know that a lot can change in from April to November!

Retailers use the visibility from the acknowledgment to make alternative plans, if needed. By sharing order data sooner, the retailer is able to track and trace if any of its consumer and store-bound orders are delayed or incomplete.

Ship notices address supply chain traceability

When companies need to locate items, during a recall for example, supply chain traceability is required. The retailer and supplier can isolate the items impacted, provide a rapid response and avoid the disposal of unaffected products.

So, how are lot numbers and expiration dates shared across the supply chain. Typically, it’s through an Advance Ship Notice (ASN), usually sent via EDI, on a GS1 barcode label, or both.

The ASN shares the final visibility to an order’s contents.

Many industries have regulations around supply chain traceability. They’ve become experts at validating lot numbers in receiving. They capture the lot information from the ASN or barcode labels on master case packs, individual items, labels and painted on pallets. And, it’s readily accessible and accurate should they need it.

Shipping details for supply chain traceability

Even if the ASN shows the delivery leaving on time, retailers know that orders can still be delayed. In-transit orders can run into issues due to customs, natural disasters and more. Supply chain visibility doesn’t stop when the truck leaves the dock. Instead, shipment statuses from carriers provide ongoing details on the location of the order. These status updates share where the order is and alerts all parties to any delays.

This data is readily available from small parcel carriers such as FedEx and UPS for drop-ship orders. Truckload carriers usually have this communication as well. Retailers and suppliers can use this data to track and trace items whenever the last mile process doesn’t go as planned.

Invoices are the final step

Once the items are received by the retailer, or the consumer in the case of drop ship, the invoice is the final communication. It closes out the order. Items are now delivered or bound for the stores. Retailers’ internal systems will now track the items through their DC to the store shelf and through the purchase point.

Automation is the easy way to achieve supply chain visibility

As you can see, supply chain partners need visibility to orders at many different points in the process. The good news is the data for supply chain traceability and visibility is available.

The common communications needed by modern supply chains include:

Retailers and suppliers just need to enlist the right tools. Every day, I work alongside our customers using SPS Commerce Fulfillment. The solution ensures all parties stay informed about the order status and have visibility to it throughout its journey.

Most companies are choosing to automate the process. This cuts out manual keying of data. By integrating systems, data flows uninterrupted. These integrations are easily done and provide a hands-free experience. For example, our Carrier Service enhances Fulfillment by automatically entering the tracking number from a carrier’s system into the ASN. Suppliers can easily share this critical detail with retailers, with no human effort.

Visibility prevents most surprises between partners, but they still may occur. When this happens, you need immediate access to the details. Our Monitor solution also provides Fulfillment users with searchable access to their trading partner transactions. You can easily identify any disruptions in the supply chain. And, our SPS team is also here to help in resolving any issues, anytime.

Interested in learning more about supply chain traceability and visibility, contact our specialists and get started today.

Scott Bolduc