EDI 857 - Shipment and Billing Notice
The EDI 857 combines a ship notice and an invoice into a single transaction - streamlining the billing process for trading partners where the invoice amount is determined at ship time rather than at PO creation.
✦ What It Does
The EDI 857 Shipment and Billing Notice collapses what would otherwise be two separate EDI transactions - an 856 Ship Notice and an 810 Invoice - into a single document. This is common in grocery and CPG distribution where the supplier generates the invoice at the moment of shipment, the invoice amount is based on actual shipped quantities (not ordered quantities), and the billing party expects to receive shipment and financial data in a single transaction.
The 857 uses the same HL (hierarchical level) loop architecture as the 856, establishing a packaging hierarchy of shipment → order → pack → item. However, the 857 adds billing-level segments not found in a pure 856: BIA (Beginning Segment for Inventory Inquiry/Advice) equivalent at the billing level, IT1 line-item detail segments that carry extended price and allowance/charge data, and TDS/TXI segments for total dollar amounts and tax. The 857's item loops therefore carry both the physical shipment details (quantities, carton/pallet data) and the financial details (unit price, extended amount, allowances).
The 857 is most prevalent in direct-store-delivery (DSD) environments where the supplier's route driver delivers to individual store locations and generates a combined ship/bill document on the spot. It also appears in grocery warehouse distribution when a supplier operates on a bill-at-ship model rather than bill-at-receipt. For trading partners who have adopted this document, the operational benefit is reduced transaction overhead and faster payment cycles - the buyer's AP system receives everything it needs to process payment in a single transmission.
⚡ When It's Triggered
- A beverage supplier's route driver closes a DSD delivery at a store and the handheld device automatically generates a 857 covering both the delivery manifest and the invoice for that stop.
- A CPG manufacturer ships an order from a warehouse and their ERP generates the 857 at manifest close - replacing the need to send both an 856 and a separate 810.
- A food distributor ships orders to grocery chain DCs and the chain's EDI spec requires a 857 rather than separate 856/810 documents, per their vendor guide requirements.
- A supplier ships promotional merchandise and needs to communicate promotional pricing, off-invoice allowances, and shipment details to the buyer's AP and receiving systems simultaneously.
Who Uses EDI 857
Grocery & CPG Suppliers
The 857 is most heavily used in grocery. Major grocery chains - particularly those operating DSD programs - may require 857 from certain categories of suppliers. CPG companies in beverages, dairy, snacks, and bread are the most common 857 users because their DSD routes have traditionally combined delivery and billing in a single driver interaction.
Food & Beverage Distribution
Broadline food distributors (Sysco, US Foods, and regional equivalents) use 857s with their supplier base to receive combined delivery and billing data. In this context, the 857 feeds both the inbound receiving workflow (what arrived on which truck) and the accounts payable workflow (what is owed for that delivery).
Consumer Goods Distribution
Distributors of health and beauty, household products, and general merchandise may adopt 857 to simplify their supplier billing relationships. Instead of reconciling separate 856 and 810 documents - which can arrive at different times and create matching challenges - a single 857 simplifies the three-way match process.
Direct Store Delivery Operations
DSD suppliers across categories (bakery, soft drinks, beer/wine, newspapers, and fresh produce) have long used combined shipment-and-billing models. The 857 brings that traditional paper workflow into EDI, allowing DSD operators to modernize without changing the fundamental business model of billing at delivery.
Key Segments & Data Elements
BSN: Beginning Segment for Ship Notice
Opens the 857 with the same structure as an 856 BSN. BSN01 = purpose code, BSN02 = shipment ID (BOL number), BSN03 = ship date, BSN05 = hierarchical structure code. The structure code in BSN05 is critical - it tells the receiver how to parse the HL loops. For 857s, common structure codes are 0001 (shipment/order/pack/item) or 0009 (shipment/order/billing/item).
HL: Hierarchical Level (Billing Level)
In a 857, an additional HL level type appears beyond the standard 856 levels: HL03=B (billing level), which nests below the order level and above the item level. The billing HL level contains the BIA and financial summary segments for that portion of the order. This structure allows the 857 to carry separate shipment and billing contexts within one transaction.
IT1: Baseline Item Data (Invoice)
The IT1 loop within the billing HL carries the financial line-item detail: IT101 = assigned identification (line number), IT102 = quantity invoiced, IT103 = unit of measure, IT104 = unit price, IT107/08 = product ID qualifier and value (UPC, vendor part, etc.). SAC segments nested within IT1 loops carry line-level allowances and charges with amount codes like H850 (promotional) and I310 (freight).
TDS: Total Monetary Value Summary
Appears at the billing level to provide the total invoice amount. TDS01 = total invoice amount in cents (no decimal point - $1,234.56 is transmitted as "123456"). This total must reconcile with the sum of IT1 extended prices plus SAC charges/allowances. AP systems validate TDS against the line-item detail before approving payment.
SAC: Service, Promotion, Allowance, Charge
In the 857, SAC segments carry the off-invoice allowances that are a hallmark of grocery billing - deal allowances, promotional funding, freight allowances, and early-pay discounts. SAC01 = A (allowance) or C (charge), SAC02 = allowance or charge code, SAC05 = percentage rate, SAC06/07 = allowance amount. These SAC values directly reduce the net invoice amount in TDS01.
MAN / REF: Carton ID and References
MAN segments within pack-level HL loops carry SSCC-18 carton serial numbers - same as in a standard 856. REF segments at various levels carry auxiliary reference numbers: BM (bill of lading), PK (packing list), IV (invoice number), CT (contract number). The invoice number in REF-IV is the number the supplier assigns as their accounts receivable reference.
Related Transaction Sets
Ship Notice / Manifest (ASN)
The 856 is the pure ship notice that the 857 partially replaces in billing-at-ship scenarios. When a trading partner requires both an ASN and a separate invoice, they use 856 + 810. The 857 is chosen when the trading partner prefers a single combined transaction and their systems can parse the more complex 857 structure.
Invoice
The standalone invoice that the 857 replaces when a combined ship/bill document is used. AP systems that receive 857s must be configured to extract the financial data from the billing HL level rather than waiting for a separate 810. Some trading partners use 857 for DSD and 810 for warehouse orders even with the same supplier.
Purchase Order
The originating PO referenced in the 857's order-level HL loop via PRF segment. The buyer's receiving and AP systems match the 857 against the open 850. If the 857 billed quantity exceeds the PO quantity, the excess may be flagged for buyer approval before payment is released.
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