Believe it or not, many businesses still rely on physical paperwork and manual data entry to exchange shipping information and coordinate logistics — an outdated approach that often leads to delays and supply chain disruptions.
Fortunately, there’s a more efficient solution: Electronic Data Interchange (EDI).
By automating data exchange, EDI eliminates inefficiencies in shipment processes. Specifically, the EDI 754 (Routing Instructions) document facilitates standardized, real-time communication, allowing trading partners to share accurate shipping details quickly.
In this guide, we’ll explain the EDI 754 document and its benefits and break down its components with an example.
What Is EDI 754?
The EDI 754 document allows buyers to share clear instructions for managing shipments with suppliers — and vice versa. It includes important details like the preferred carrier, transportation mode, and other shipping specifications to ensure everything is routed accurately and on schedule.
What’s EDI 753? How Do
Understanding the difference between EDI 753 and 754 is simple: Who initiates the process, the buyer or the seller? With EDI 753 (Request for Routing Instructions), suppliers ask buyers for shipment details. Conversely, EDI 754 comes from the buyer, providing suppliers with the routing information they need to proceed.
EDI 754 Specifications and Components
EDI 754 facilitates coordination between shippers and carriers, providing detailed routing instructions necessary for goods to be delivered as planned. Here’s a breakdown of its main components, which are known as segments:
Carrier Details
This segment includes specific information about the carrier handling the shipment, such as the equipment type (e.g., a refrigerated or dry van), carrier identification, and service level requirements (e.g., standard or expedited).
Pickup and Delivery Locations
This segment specifies where the goods are coming from and going to, including shipping addresses for both pickup and delivery points and contact details for each site.
Dates and Times
This segment outlines key timelines, including pick-up times and delivery windows in standard formats.
Shipment Size
This details the shipment's volume, size, and weight. Additional freight details may include the number of pallets, total weight, and dimensions.
Reference Documents
This segment links the shipment to related instructions or documentation, such as purchase order numbers and bills of lading.
How Is the 754
The EDI 754 document facilitates the exchange of routing instructions between trading partners. Here’s how the process works, step by step:
Requesting Routing Instructions
1. The Manufacturer Prepares the Request
The process begins when the supplier generates an EDI 753 (Request for Routing Instructions). This document notifies the buyer or carrier that the shipment is ready and routing details are needed. It includes essential information like freight details, shipment origin and destination, and the expected delivery date.
2. Transmitting the EDI 753 to the Carrier or Buyer
The supplier sends the EDI 753 to the buyer or carrier using an EDI system. This ensures that all necessary information reaches the recipient to plan the shipment effectively.
Receiving Routing Instructions
1. The Buyer or Carrier Responds
Once the buyer or carrier receives the EDI 753, they prepare the EDI 754 (Routing Instructions). This document provides detailed guidance, including the carrier assignment, shipment mode, pickup and delivery schedules, and any special handing instructions.
2. Transmitting the EDI 754
The buyer sends the EDI 754 back to the supplier, completing the exchange of routing details.
Acknowledgment
After receiving the EDI 754, the supplier generates an EDI 997 (Acknowledgment). This document confirms that the supplier has received and processed the routing instructions.
With the acknowledgment complete, the supplier works with the assigned carrier to execute the shipment according to the provided instructions.
EDI 754 Example
Here's an example of how an EDI 754 document might look in its code using the ANSIX12 format:
ISA*00* *00* *ZZ*BUYER *ZZ*SUPPLIER *230101*0800*U*00401*000000001*0*T*>~
GS*SM*BUYER*SUPPLIER*20230101*0800*1*X*004010~
ST*754*0001~
BSN*00*123456789*20230101*0800~
N1*SF*Supplier Name*9*1234567890~
N3*123 Supplier Street~
N4*City*State*12345~
N1*ST*Buyer Name*9*0987654321~
N3*456 Buyer Avenue~
N4*City*State*54321~
TD5*B*2*FEDX*LT*Ground~
R4*UN*OAK*Oakland Port*US*94607~
MAN*GM*0987654321~
LIN**BP*ITEM12345*VP*987654321~
SN1**20*EA~
DTM*011*20230105~
MSG*Handle with Care~
CTT*1~
SE*17*0001~
GE*1*1~
IEA*1*000000001~
EDI 754 Example Segments
Now, let’s break down the EDI 754’s segments in this example:
ISA (interchange control header): This marks the start of the interchange, containing the sender and receiver IDs, the interchange date and time, and a unique control number.
GS (functional group header): This groups related transaction sets and identifies the sender and receiver. It also specifies the functional purpose of the group.
ST (transaction set header): This indicates the start of the transaction set and includes a unique control number and the transaction type (754).
BSN (beginning segment for shipping notice): This provides an overview of the transaction, including the purpose code (e.g., original), a unique identifier for the routing instructions, and the date and time of the transaction.
NI (name): This identifies the parties involved in the shipment, including SF (the supplier’s ship-from location) and ST (the buyer’s ship-to location).
N3 (address information): This is the supplier’s and buyer’s street addresses.
N4 (address information): This is the supplier’s and buyer’s city, state, and postal codes.
TD5 (carrier details): This defines carrier information, such as the routing sequence code (e.g., origin and carrier responsibility), carrier identification (e.g., name or code), and the transportation method or type (e.g., ground or air).
R4 (port or terminal): This provides information about the port or terminal for unloading, including the port’s city, state, and postal code.
LIN (line item): This describes the items being shipped, including the buyer’s part number and vendor product code.
SN1 (item detail): This specifies the quantity of items being shipped and the unit of measurement for each item.
DTM (date/time reference): This indicates the shipment dates, including delivery windows and standardized date/time formats for clarity.
MSG (message text): This adds any special instructions for the shipment, such as handling requirements.
CTT (transaction totals): This summarizes the total number of line items included in the transaction.
SE (transaction set trailer): This marks the end of the transaction set, verifying the number of segments and ensuring it matches the control number in the ST segment.
GE (functional group trailer): This indicates the end of the functional group and confirms the total number of transaction sets within the group.
IEA (interchange control trailer): This closes the interchange, verifying that all segments have been processed successfully.
3 Benefits of EDI 754
Implementing the EDI 754 document provides significant advantages for businesses managing shipments. Here’s a closer look at the key benefits:
Increased Control
The EDI 754 provides a structured format for sharing and tracking routing instructions. All trading partners gain access to clear, detailed information, improving planning, coordination, and overall visibility across the supply chain.
Greater Accuracy and Efficiency
By automating the transmission of routing instructions, the EDI 754 reduces the need for manual processes. This minimizes errors and ensures routing details are accurate. Automation also speeds up communication between trading partners, cutting down on the time, effort, and resources required for scheduling and shipping. The result? Faster shipping times and on-time deliveries.
Compliance and Standardization
The EDI 754 helps enforce compliance with buyer-specific shipping policies. It also establishes a standardized method for communicating routing instructions, ensuring consistency and reliability in shipment coordination.
Automate Your EDI 754 Routing Instructions
Now you have a better understanding of EDI 754 transactions, but what about all the other benefits that cloud-based EDI solutions offer? Connect with an expert to learn more about how EDI can simplify your logistics operations.