ASN Full Form: What Is an Advanced Shipping Notice?

Published on November 12, 2025

• 8 min read

As an e-commerce business, there is a lot to plan, including warehouse staff, inventory forecasts, and dock scheduling. All these aspects can go haywire when the seller tells you, “Your shipment is on the way.” There are no further details for you to plan further action.

In contrast, when you get an ASN, you receive an early, data-rich alert of what’s coming, when, and how it’s packaged. The full form for ASN is Advanced Shipping Notice. It has been found that getting ASN can help reduce receiving costs by almost 40%. This proves that ASN in logistics can be a powerful tool.

Today, we will explain the ASN full form, the role of ASN in supply chain and logistics, and provide practical tips for its implementation.

What is ASN? (ASN Full Form and Definition)

Let us first begin with the ASN full form:

ASN stands for Advanced or Advanced Shipping Notice and is also represented as EDI 856 in the supply chain systems of the ANSI X12 transaction set version for “Ship Notice / Manifest”.

What is an Advanced Shipping Notice?

ASN, or Advanced Shipping Notice, is a digital message or document sent by the supplier, shipper, or a third-party logistics (3PL) provider. It is sent to the buyer or the consignee before the physical arrival of the goods occurs.

The sole purpose is to provide detailed information about an impending shipment to the buyer/recipient so that they can prepare accordingly.

Key features of an ASN include:

It is “advance”, meaning the notice is given before delivery, enabling planning. If the shipment arrives before ASN, much of its benefit is lost.
It contains shipment metadata (dates, carrier, IDs), packaging and contents breakdown, quantities, weights, and other logistical details.
It often integrates with the ERP, WMS, or SCM systems of the receiver, allowing receiving operations to be automated or streamlined.
It is usually transmitted electronically (via EDI, XML, or API) to reduce manual work and errors.

ASN works as a proactive communication tool that bridges the gap between shipment dispatch and delivery.

Components of an ASN: What Must It Include?

Not all ASNs need to be identical. However, it needs to align with the trading partner and, as per industry standards. However, certain elements are always needed. Here is the breakdown of ASN components:

Component / Field	Purpose / What It Contains
Shipment header info	Shipment ID, date/time, carrier, Bill of Lading or PRO number, origin & destination address, mode of transport
Purchase Order reference	The PO number or reference that this shipment is fulfilling
Item/line-level details	SKU or part number, description, quantities shipped, units of measure, lot/serial numbers if applicable
Packaging hierarchy	How items are packed (whether it is cartons or pallets), carton ID, weight, dimensions, and palletization structure
Expected delivery/scheduling info	Estimated arrival date/time, any delivery window constraints
Logistics & carrier details	Carrier name, routing instructions, tracking numbers, shipping method
Returnable containers / packaging	Info on reusable packaging or returnable containers, if relevant
Cumulative / previous receipt info	In some systems (e.g., Oracle), cumulative quantities already received vs. what is incoming
Billing or invoice fields (optional)	Some ASNs include invoice or tax details, so that when they’re accepted, invoice creation can be automated

Who Uses Advanced Shipping Notice?

As ASN is used across different industries, some of the common use cases are:

E-Commerce & Retail: Retail chains need suppliers to send across ASN so that the distribution centres or stores can align receiving schedules and avoid shipment surprises.

Third-Party Logistics (3PLs): 3PL or Third-Party Logistics providers send or integrate ASNs on behalf of their clients to coordinate inbound and outbound loads.

Drop-ship / Direct-to-consumer: In drop-ship models, retailers expect suppliers or marketplaces to send ASNs so that the retailer and customer can track the shipment.

Cross-border / Import / Export: For global trade, ASNs may include customs, compliance, and traceability data to help receivers prepare for import clearance.

Manufacturing / Just-in-Time (JIT): Manufacturers rely on ASN to ensure that parts arrive just-in-time, thereby minimising inventory holding.

Why Is ASN Important in Supply Chain & Logistics?

Using ASN is beneficial for both suppliers and buyers. Let us look at how ASN is important in supply chain and logistics:

Better Visibility and Planning

With ASN, buyers can gain better visibility into the contents of incoming shipments. It contains information about the items, the number of items and how those items are packaged.

Being aware of such details allows warehouses or DC teams to reserve dock space, schedule receiving windows, allocate storage and also plan labour. ASN helps buyers to be proactive rather than reactive.

Minimum Error and Faster Processing

The Advanced Shipment Notice has the complete breakdown of shipment contents and barcoding/palletisation details. Hence, receivers can match what arrives with the ASN, scan pallets and containers and reconcile discrepancies automatically. It will help reduce human errors and save time on manual data entry and verification.

Inventory Accuracy and Forecasting

Since the incoming goods are pre-notified, systems can reflect “in-transit inventory” accurately. It will assist in allocating and reserving goods before they actually land. It will lead to improved inventory accuracy and also prevent bottlenecks, such as stockouts and overstock.

Improved Supplier Collaboration & Accountability

The primary objective of ASN in logistics is to strengthen the communication pipeline between the buyer and supplier. An error or mismatch between the ASN and the actual receipt can lead the buyer to trigger an application advice or a corrective notice back to the supplier.

Compliance & Trading Partner Requirements

Major logistics networks and retailers mandate ASN or EDI 856. It is a precondition for accepting shipments. If a supplier fails to send an ASN, they may face penalties or have their receipts refused.

Best Practices to Maximise ASN Benefits

To make the most of the ASN in supply chain or ASN in logistics, it is necessary to follow better practices, such as:

Use a commonly accepted EDI standard (X12 856, EDIFACT DESADV) and make sure both parties adhere to it.
Begin with a core set of ASN fields (shipment ID, PO reference, packing breakdown, and quantities) and gradually expand optional fields (such as traceability, container reuse, etc.).
The buyer’s system should validate incoming ASNs immediately, flag any errors, and provide feedback to suppliers before the shipment’s arrival.
Ensure your Warehouse Management System or ERP can ingest ASN and automate it into your receiving workflows. For instance, Oracle supports the use of validated ASNs to automatically create receipts.
Monitor real-time compliance by tracking the percentage of shipments with valid ASNs, average error rates, and exceptions handled, among other key metrics.
Some advanced operations use ASN data to pre-stage inventory, cross-dock, or route items directly to outbound lanes, bypassing full put-away
Utilise analytics on ASN vs. receipt mismatches to identify systemic issues with suppliers or packaging and make improvements over time.

International Trade Terms Simplified With WareIQ

WareIQ’s smart shipping solution helps eCommerce brands minimise cost leakages caused by RTOs, fake delivery attempts in NDR, weight reconciliation issues, and more. Our solution also offers prompt support for handling urgent client escalations, ensuring smooth operations at all times.

Our solution offers the following capabilities:

Multi-carrier engine enabling fast deliveries across 24,000+ pin codes
Control Tower & automated workflows to minimise NDRs & RTOs
Same/Next-day delivery courier options
Seamless Integration with your WMS, ERPs and Storefronts
Shipping Badges to display precise Estimated Delivery Dates (EDD)
Custom-branded tracking pages and notifications to enhance customer experience

Conclusion

To conclude, the full form of ASN, Advanced Shipping Notice, is not just like other paperwork needed in international trade. It is foresight in action. ASN provides a clear view of what is arriving and when, making it quite useful for the retail and e-commerce industry. It turns uncertainty into preparedness, making supply chains smarter, faster, and far more reliable.

FAQs About ASN – Advance Shipping Notice

Why is an Advance Shipping Notice important in supply chain management?

An Advance Shipping Notice is important because it provides buyers with visibility into incoming shipments, enabling them to plan labour, dock schedules, and inventory management.

What information does an ASN typically include?

An ASN usually includes shipment details such as purchase order number, carrier information, packaging hierarchy, item descriptions, quantities, weights, and expected delivery dates.

Who is responsible for sending an ASN?

The supplier, manufacturer, or logistics provider responsible for shipping the goods is usually the one who generates and sends the ASN to the buyer.

Can ASN improve warehouse efficiency?

Yes, ASN improves warehouse efficiency by allowing teams to pre-plan receiving, allocate storage space, and match items against expected shipments quickly.

Supercharge your fulfilment with WareIQ now, contact our team.

Author

Mariyam Jameela

Mariyam Jameela works as a content writer at WareIQ. With a proven track record of working with renowned brands such as GO Digit, Urban Ladder, Juspay, Hong's Kitchen, and many more. She actively contributes to the creation of blog posts centered on eCommerce operations, fulfillment, and shipping, in addition to providing insights on various strategies and techniques tailored for eCommerce sellers

Read all of Mariyam Jameela's Posts

CFR Full Form and Its Importance in International Trade (Cost and Freight)

Every industry has its own shorthand and abbreviations used to simplify work. International trade is no exception. If you have ever come across CFR in a shipping contract and wondered what it means, you are not alone. CFR, the full form being Cost and Freight, may seem like simple terms, but there is much to consider when it comes to global trade.About 11 billion tonnes of goods get transported by sea, according to UNCTAD. This volume makes maritime trade the lifeblood of international commerce. In this massive ecosystem, even a small misinterpretation of terms like 'CFR shipping' or 'what is CFR in shipping' can cost companies millions in freight cost overruns, insurance gaps, or delayed deliveries.In this article, we will break down the CFR's full form in the context of export, its meaning, and its significance in detail.What Is CFR? (CFR Full Form & Meaning in Shipping)CFR Full FormCFR's full form is Cost and Freight; CFR is an Incoterms full form, where Incoterms are essentially International Commercial Terms, which are published by the (ICC) International Chamber of Commerce. Under CFR, a seller is responsible for arranging and paying for the transportation of goods via sea. The consignment will be sent to the buyer's preferred port of destination. What Is Freight Cost, and What Is Its Role under CFR?Freight cost is at the core when it comes to CFR (Cost and Freight). In simple terms, freight cost refers to the charges imposed by a carrier for transporting goods from the origin to the destination.It typically covers fuel, vessel operations, port handling, canal/lock fees, etc. However, in the CFR shipping arrangement, the seller covers the freight cost up to the port of destination. Thus, freight cost is a significant component of the total price paid by the buyer.Why is Freight Cost Important in CFR?As the seller pays the freight cost, it is necessary for the seller to carefully estimate and include it in the selling price. If it is not included in the selling price, unexpected cost escalations can erode margins. From the buyer's perspective, even though freight is "paid", they face risks during transit. Hence, buyers may still opt to insure the goods from loading to unloading. As the buyer does not have to source the freight; the freight cost under CFR makes the offer much more attractive. However, the buyer must also manage downstream costs. It is therefore essential to understand the meaning of freight cost and to incorporate it correctly, as this matters to both buyers and sellers.CFR Shipping Terms: Key ObligationsSmooth international trade occurs when there is clarity about who pays for what and when. Under CFR shipping terms, these obligations are clearly divided between the seller and buyer. Knowing and understanding the roles will help to prevent costly disputes and will facilitate smoother trade operations. Here is the breakdown:Seller's Obligations under CFRWhile the seller covers the initial freight cost, the risk will shift once the goods get loaded into the vessel. Here are the obligations that have to be fulfilled by the seller:Export Packaging and DocumentationIt is the seller's responsibility to package the goods safely for international transport. Another necessity is to provide key documents such as the commercial invoice, bill of lading and packing list.Customs Clearance in the Exporting CountryThe seller also has to obtain a licence, permits and complete export customs clearance formalities.Inland Transport to Port of OriginThe seller must also arrange and pay for the movement of goods from the factory or warehouse to the loading port.Loading CostsThe handling and loading costs of goods from the port of origin are to be borne by the seller.Freight Cost PaymentA core part of the CFR shipping terms is that the seller books and pays the sea freight to the destination port.Shipment ProofThe seller must provide evidence (usually via a bill of lading or onboard certificate) that goods were loaded and shipped.Buyer's Obligations under CFRThe buyer's responsibilities under CFR shipping terms begin the moment the cargo is loaded on the vessel at the origin port. Here are the buyer's obligations:Insurance CoverageAccording to the CFR shipping terms, the buyer is required to take out marine insurance for the goods, which will help protect against loss or damage during transit.Risk Assumption at LoadingOnce the goods are on board at the port of origin, the buyer bears the risk, even though the seller still pays the freight charges.Cost of UnloadingThe unloading charges have to be borne by the buyer. Other charges include terminal handling fees and other port-related expenses.Import Customs ClearanceHandling import documentation, paying duties, VAT, and other taxes at the destination country are roles that have to be handled by the buyer.Inland TransportationThe cost of transporting the goods from the destination port to the final warehouse must be covered by the buyer. Communication & Documentation ComplianceThe buyer must ensure the timely receipt and handling of documents provided by the seller (such as the bill of lading) to facilitate the smooth collection of the shipment.Importance of CFR in International TradeSince a large portion of the goods is moved by sea, having clear CFR shipping terms leads to smooth transactions. One such essential term that importers and exporters must be aware of is the CFR full form in the context of export and import, along with the CFR shipping terms. Here is why CFR is essential in international trade:CFR shipping ensures the seller pays the freight cost up to the destination port, while the buyer handles insurance, unloading, and import duties. This transparency reduces disputes over hidden costs.By specifying that risk transfers when goods are loaded at the origin port, CFR shipping terms clearly define liability, enabling both parties to plan their insurance and risk coverage strategies effectively.As one of the official Incoterms, the CFR full form creates a universal standard recognised worldwide, making cross-border contracts easier to negotiate and enforce.Offering goods under CFR shipping can make sellers more attractive, as they simplify logistics for buyers and present all-in-one pricing (including freight cost).Since sellers manage the sea freight, buyers don't need to negotiate shipping themselves, saving time, especially in markets where sellers have stronger carrier networks.CFR allows buyers to choose their own insurance provider, rather than relying on the seller's coverage, giving them more control over risk protection.Suggested - ASN Full Form: What Is an Advanced Shipping Notice?Get Clarity Over CFR and Other Trade-related Terms With WareIQ's AssistanceWareIQ's smart shipping solution helps eCommerce brands minimise cost leakages caused by RTOs, fake delivery attempts in NDR, weight reconciliation issues, and more. Our solution also offers prompt support for handling urgent client escalations, ensuring smooth operations at all times.Our solution offers the following capabilities:Multi-carrier engine enabling fast deliveries across 24,000+ pin codesControl Tower & automated workflows to minimise NDRs & RTOsSame/Next-day delivery courier optionsSeamless Integration with your WMS, ERPs and StorefrontsShipping Badges to display precise Estimated Delivery Dates (EDD)Custom-branded tracking pages and notifications to enhance customer experienceConclusionThe shipping industry is growing steadily and is becoming increasingly complex, too, with new systems being incorporated. With rising freight costs, changing customs procedures, and increasing trade volumes, it is crucial to understand the CFR full form and its associated shipping terms. For sellers, it offers a way to stay competitive by managing freight on behalf of buyers. For buyers, it can provide cost transparency while maintaining control over insurance and post-arrival logistics. Knowing and understanding the CFR meaning and application is more than a legal requirement; it provides protection against risk, acts as a driver of trust, and, importantly, is a cornerstone for smooth international commerce.FAQs About CFR Full FormWhat is the full form of CFR in shipping?CFR stands for Cost and Freight, an Incoterm where the seller pays for shipping the goods to the buyer's destination port, but the risk will get transferred when the goods are loaded onto the vessel.Is CFR recognised globally?Yes, CFR is an official Incoterm which is published by the International Chamber of Commerce. It is widely used in international trade contracts.Can CFR terms be used for hazardous or oversized cargo?Yes, CFR can be applied, but additional planning is required. Sellers may need to coordinate specialised freight carriers or obtain permits, and buyers should consider insurance coverage due to higher risk. Proper documentation becomes even more critical in such cases.What documentation is critical for buyers to claim goods under CFR?Documents that a buyer must receive are:Bill of lading (a proof that goods were loaded on the vessel)Commercial invoiceExport clearance certificatesPacking listAll these documents facilitate smooth customs clearance while ensuring the timely receipt of goods at the destination port.

November 11, 2025

Dead Stock: Meaning, Causes, and How to Deal With It

Inventory is rightly called the backbone of a business, but what if the inventory stops moving? This is what businesses refer to as dead stock. Dead stock can be referred to as products that are not being sold or are sitting idle in warehouses or on shelves. It drains resources instead of generating revenue. According to reports, even well-run companies often report that about 20 to 30% of their inventory is dead or obsolete. This ties up capital that could be invested in faster-moving, profitable products. Hence, businesses must understand the dead stock meaning, its causes, and the strategies that can be adopted to reduce dead stock levels. Understanding the Dead Stock MeaningDead stock, also known as dead inventory or obsolete stock, refers to products or stock that fail to sell and are most unlikely to sell in the future. Unlike returned stock, dead stock has never been sold to a customer.Some examples include seasonal items, outdated tech products, or products with an expired expiration date. Maintaining a dead stock register is a crucial task in inventory management, enabling businesses to track unsellable inventory.Proper dead stock analysis enables companies to distinguish between slow-moving items and truly obsolete stock, thereby improving decision-making and resource allocation.Why Must Businesses Know About Dead Stock?Dead stock is more than just inventory that remains unsold; it is a profit killer that can have a significant effect on a business's revenue. Understanding why dead stock matters helps businesses take proactive measures to minimise losses. Here is why dead stock matters:Ties Up CapitalThe items that are not sold represent money that you have spent, but it is not generating revenue. This frozen capital could otherwise be used to stock high-demand items, invest in marketing, or expand operations.Increases Storage CostsTo store products, businesses have to spend money. Any item that remains in the warehouse incurs associated costs, which include warehouse rent, insurance, utilities, and labour. Dead stock will, over time, increase expenses while not generating any revenue, which will have a negative impact on profit margins. Operational InefficiencyManaging excess inventory can take valuable time as well as resources. Staff will be stuck in tracking, moving, and monitoring dead stock, thereby diverting attention from more important operations.Obsolescence RiskIn most cases, any product that remains unsold for an extended period creates a risk of being outdated, damaged stock, or even expired stock. For example, in the fashion and electronics industries, items can lose relevance quickly, rendering inventory worthless.Opportunity CostDead stock occupies the shelf space in a warehouse that could have been used to house a fast-moving or revenue-generating item. This limits your ability to respond to market demand and maximise sales opportunities.What Are the Common Causes of Dead Stock?There is no single cause for a stock item to become dead stock. From misjudgement to overstocking, here are some of the most common causes of dead stock.1. Misaligned Market FitIf businesses store items that do not match a customer's preferences, they will remain unsold for months. Here is why it can happen:Incorrect timing or seasonality (e.g., winter jackets in spring).Features or designs that don't appeal to target customers.Pricing not aligned with perceived value.2. Overstocking & Excess OrdersFrom the fear of being understocked, businesses can unknowingly overstock items that will ultimately end up as dead stock. Here is why it can happen:Overestimating customer demand.Fear of stockouts leading to bulk purchases.Lack of real-time sales data to guide orders.3. Sales CannibalisationWhen new products are introduced to the market, businesses may end up storing excess inventory, which can overshadow their existing offerings. Here is why it can happen:Launching similar products without differentiation.Poor analysis of product overlap.Promotions favouring new items over existing stock.4. Defective, Damaged, or Low-Quality ProductsAt times, there are damaged stocks that do not meet quality standards, leading to the accumulation of dead stock. Even expired stock amplifies the volume of dead stock. Here is why stocks are in the damaged category:Packaging defects or mishandling during shippingManufacturing flawsCustomer rejection due to poor quality5. Changing Consumer Trends or TechnologyCustomer preferences are dynamic and can change with new fashion trends or seasonal shifts, resulting in old and outdated inventory becoming dead stock. Here is why it can happen:New technology replaces older models, making them outdated (e.g., electronics).Fashion trends keep changing faster than stock turnover.Customers preferring an updated look, design or features of a product.6. Supplier LimitationsRigid supplier policies can force overstocking and contribute to dead stock.When a supplier has minimum order limitations. The limitations are more than what is actually needed.Long lead times are preventing flexible ordering.Inability to return or exchange unsold items.7. Expired Stock or Seasonal ItemsOne of the causes of dead stock is the accumulation of inventory which is seasonal or near expiration. For example:Perishable goods have near expiry dates.Holiday-themed items remain unsold after the season.Limited-edition products eventually lose relevance over time.8. Manual Inventory ErrorsReliance on spreadsheets and manual tracking can lead to errors in stock management.Miscalculating the order quantities.Not being able to track slow-moving items.Human errors in recording sales and stock levels.How to Deal With Dead Stock: Proven StrategiesTo save money, free up warehouse space, and create profit opportunities, businesses must actively manage dead stock. Here are proven strategies:Offering deep discounts encourages the sale of slow-moving items, freeing up warehouse space for more profitable inventory.Pairing dead stock with popular items or offering them as gifts increases customer interest and reduces unsold inventoryDonate items to charitable organisations or recycle them responsibly. This approach may offer tax benefits and enhance brand reputation.Automated systems like inventory management software provide real-time data, track product performance, and prevent overstocking, minimising the risk of dead stock accumulation.Have periodic reviews of the inventory to identify slow-moving products, plan timely markdowns, and adjust purchasing strategies accordingly.Better Inventory Management With WareIQ to Avoid Dead StockWareIQ is a Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfillment across D2C, Marketplaces, Quick Commerce, and B2B (General Trade & Modern Trade)Our solution offers:Pan-India network of Seller Flex & FAssured compliant across 12+ cities operated by WareIQ, and shipping partners for last-mile delivery across 27000+ pin codesMulti-Channel Fulfilment Platform with plug-and-play integrations across marketplaces (Amazon, Flipkart, Myntra, Nykaa, etc.), D2C platforms (Shopify, Magento, WooCommerce, etc.), WMS, and ERPs, to support fulfilment across distributors, flagship stores and eCommerce channels with analytics capabilities to assess operational performanceInventory LogIQ: AI-led multi-channel inventory planning solution to minimise stockouts and automate replenishmentLeverage the tech-enabled returns QC solution to capture, centrally store, and auto-index HD media evidence of damaged or missing returned products and eliminate marketplace claims rejections.A host of seller enablement and support – dedicated account manager, APOB/PPOB registrations, GST registration, NDR & COD verification, etc.ConclusionDead stock is not just inventory that is not being sold due to several reasons; it is a hidden cost that drains resources, reduces operational efficiency, and, more importantly, ties up capital, thus impacting profit margins. Proactively analysing inventory, staying tuned to market trends, and leveraging technology not only minimises dead stock but also transforms inventory management into a competitive advantage. Considering how fast-paced the retail industry is, managing dead stock effectively is not just a good practice but an essential task for sustaining profitability, improving cash flow, and ensuring that every product in your warehouse contributes to growth.FAQs About Dead StockWhy is it important to identify dead stock?Identifying dead stock helps businesses minimise financial losses, free up storage space, and improve inventory turnover by focusing on products that generate revenue.What is a dead stock register, and why is it used?A dead stock register is a systematic record of all unsellable inventory. It helps track, monitor, and plan strategies for the disposal, sale, or donation of surplus or obsolete items.What is dead stock analysis, and why is it important?Dead stock analysis involves reviewing inventory to identify unsellable or slow-moving items. It enables businesses to make informed decisions on clearance, disposal, or purchase planning.Does technology play any role in managing dead stock?Yes, technology like inventory management software can give real-time tracking, sales data analysis, and alerts for slow-moving items, helping prevent dead stock accumulation.

November 10, 2025

Step-by-Step Guide to the Customs Clearance Procedure in India

For businesses, one of the most dreaded statuses is "Held at Customs". It can make you quite anxious in such situations. Every day the shipment is held back, businesses suffer heavy losses due to lost sales, increasing storage charges, and damaged client relationships. As per the World Bank's Logistics Performance Index 2023, India has ranked 38th globally, with efficient customs clearance being one of the key performance indicators which influences trade competitiveness.It is therefore necessary for businesses to understand customs clearance procedures, irrespective of whether you are an importer, exporter, or a business dealing with imported or exported goods. In this article, we provide a step-by-step guide to the customs clearance process in India, as well as discuss other key aspects, including the role of customs clearance agents, customs clearance documents, charges, and best practices.What is Customs Clearance?Customs clearance is a process by which goods (imported or exported) are checked, documented, and cleared by government authorities. It ensures:Duties and taxes are correctly assessed and collected.The goods comply with trade, safety, environmental, and other regulations.Illegal, misdeclared, or restricted items are prevented from entering or leaving.The customs clearance guidelines are governed by the Customs Act, 1962. Moreover, they are administered by the CBIC (Central Board of Indirect Taxes and Customs).The customs clearance procedure involves a sequential set of steps, from the arrival of goods to their release. Which Are the Key Stakeholders in the Customs Clearance Process?Several parties are involved in the customs clearance procedure. Before we begin to follow the steps, it is necessary to know the key stakeholders, such as:Importer / Exporter: The party owning or commissioning the goods.Carrier / Shipping Line / Airline: Responsible for filing the manifest (IGM/EGM) and bringing the goods to port.Customs House Agent (CHA) / Customs Clearance Agent: Licensed intermediary who handles paperwork, liaison, and formalities on behalf of the importer/exporter.Customs Authority: The government entity (under the Central Board of Indirect Taxes & Customs) that inspects, evaluates, and clears goods.Custodian / Warehouse / Port Authority: Handles physical custody until clearance is obtained.Step-by-Step Guide to the Customs Clearance Procedure in IndiaNavigating customs clearance can be quite confusing; therefore, it is essential to understand the step-by-step customs clearance procedure. It can help save time, reduce costs, and mainly prevent delays. Below is a detailed stepwise path for import customs clearance. (Export clearance follows a parallel route with shipping bills and drawback mechanisms.)Step 1: Prerequisite — IEC, Registration & Compliance1. Obtain Import-Exporter Code (IEC)Before initiating imports or exports, you must acquire an electronic IEC from the Directorate General of Foreign Trade (DGFT). It is mandatory for customs clearance.2. Registration with ICEGATE / Customs EDIYou (or your CHA) need to register on India's ICEGATE portal for e-filing Bills of Entry, Shipping Bills, and other declarations.3. Check Regulatory Permits / LicencesSuppose the goods fall under a restricted or regulated category (such as drugs, hazardous chemicals, or defence goods). In such cases, it is important to gain permits from the governing authorities, such as the Drug Controller or the DGFT.4. KYC / Importer Identity DocumentsMandatory documents include:Proof of identityProof of addressCompany RegistrationPAN.Step 2: Arrival & Manifest Filing (IGM / EGM)1. Call of Vessel / Arrival NotificationThe carrier (ship, airline, or freight forwarder) is responsible for notifying Customs about the arrival of the vessel or aircraft at the destination Customs station.2. Filing of Import General Manifest (IGM)The IGM is a declaration listing all the goods on board. It must be submitted electronically before or shortly after arrival. Filing an IGM is a legal requirement under Section 30 of the Customs Act. Without a correct IGM, goods cannot be legally unloaded for customs processing.3. Goods Landed in Custody of CustodianUpon verification of the manifest once the vessel has arrived, the goods are then offloaded and placed under the custody of an approved custodian or warehouse until further customs clearance steps are completed.Step 3: Bill of Entry Filing & Declaration (Self-Assessment)1. File Bill of Entry (BoE) / Cargo DeclarationThe Bill of Entry has to be filed by the importer or the DHA for warehousing or home consumption in the prescribed form. Under the EDI system, the BoE is submitted electronically; no physical documents are required at the time of filing (but originals must later be produced at examination).The bill of entry contains all the necessary details, including the goods' description, value, HSN classification, tariff details, and details of origin.The importer must certify the correctness of the information. Any misdeclaration can lead to penalties.2. Noting / Registration of BoEOnce the BoE is registered or noted, it confirms that the goods are manifested as the IGM. In the EDI environment, much of this is automated. 3. Self-Assessment & Duty CalculationNext, the importer or the CHA calculates the applicable duties, such as:Basic Customs dutyIGSTAnti-dumpingSafeguardCessThe system then processes the calculation and assigns duties.The customs assessing officer verifies the classification, valuation, and eligibility of exemptions or notifications. In case of doubts, the office may seek clarification or even order a customs inspection.Step 4: Examination, Assessment & Out-of-Charge1. Physical Examination / SamplingDepending on the risk assessment, some consignments must be cleared via a "second check". If a first check (pre-assessment) is ordered, the goods are examined before final duty assessment.Examination involves verification of quantity, description, and valuation, along with checking compliance with necessary rules and regulations. Samples may be taken for further testing.2. Final Assessment & ConfirmationOnce the examination is complete, the assessing officer will then move on to finalise the classification, valuation, and duty. The BoE is confirmed, and duties are calculated while also including any applicable surcharges, IGST, or other charges. 3. Payment of Duty and Other ChargesIn the next step, the importer will deposit the due amount into the designated bank account or submit a treasury challan. Then the BoE is endorsed and cleared.4. Clearance Certificate/Out-of-Charge OrderOnce the duties are paid and all cheques are cleared, Customs will issue an "Out-of-Charge" or Let-Out" order. This will allow the goods to leave the customs premises. 5. Cargo ReleaseAs the final step, the CHA or the importer can take the delivery from the custody or the port warehouse. If goods are in a bonded warehouse, an ex-bond Bill of Entry is filed to remove the goods upon payment of duty at the time of removal.Role & Responsibilities of a Customs Clearance Agent (CHA)To complete the customs clearance process successfully, a customs clearance agent plays a crucial role. Here are the customs clearance agent's responsibilities:Preparing and filing declarations (BoE, Shipping Bill) via EDI.Making sure that classification, valuation and documentation are accurate.Liaising with customs officers, responding to queries, and securing examination orders.Ensuring the physical inspection or sampling is done successfully.Obtaining clearance orders.Coordinating duty payments.Movement of cargo from customs custody after clearance.Advising on regulatory compliance, classification, and tariff benefits.Managing amendments, appeals, and rectifications.Seamless Customs Clearance Assistance From WareIQWareIQ's smart shipping solution helps eCommerce brands minimise cost leakages caused by RTOs, fake delivery attempts in NDR, weight reconciliation issues, and more. Our solution also offers prompt support for handling urgent client escalations, ensuring smooth operations at all times.Our solution offers the following capabilities:Multi-carrier engine enabling fast deliveries across 24,000+ pin codesControl Tower & automated workflows to minimise NDRs & RTOsSame/Next-day delivery courier optionsSeamless Integration with your WMS, ERPs and StorefrontsShipping Badges to display precise Estimated Delivery Dates (EDD)Custom-branded tracking pages and notifications to enhance customer experienceConclusionMore often than not, customs clearance seems like a challenge considering the vast list of steps and documentation, but it does not necessarily have to be. If businesses understand the customs clearance procedure, they can make sure that the goods move seamlessly across borders. It is necessary to file in advance, follow regulatory updates and monitor duty requirements. Following the step-by-step guide can transform a complex bureaucratic process into a smooth, predictable, and cost-efficient part of your business.FAQs About the Step-by-Step Guide For Customs Clearance ProcedureWho is the responsible party for customs clearance?The importer or exporter is legally responsible for ensuring that goods are accurately declared and all duties are paid. A licensed customs clearance agent (CHA) can be appointed to manage documentation, liaison, and procedural compliance on their behalf.What are the necessary documents required for customs clearance?Essential documents include the commercial invoice, packing list, Airway Bill or Bill of Lading, Import Export Code (IEC), certificate of origin, applicable permits or licences, insurance certificate, and any testing or compliance reports.What is a customs clearance certificate?A customs clearance certificate is an authorisation issued by customs confirming that duties are paid, inspections (if any) are complete, and goods are cleared for delivery or further transportation.Can I clear customs without a customs clearance agent?Yes, importers and exporters can clear customs themselves if they understand the procedures and regulatory requirements. However, using a CHA is highly recommended to avoid errors, delays, and penalties, especially for complex shipments.

November 07, 2025