The humble postcode is in fact not as old as is commonly thought, with its origin dating to 1959 in the UK city of Norwich. The necessity arose from the increasing complexity of postal delivery due to growing populations and intricate city structures. Similarly, in response to the heightened intricacies of modern global supply chains, businesses have adopted the Global Location Number (GLN) as a standard.

A GLN is a universal code within the GS1 system of standards that simplifies the identification of companies and destinations by letting businesses know where goods are, and who else is taking part in the transaction along the global supply chain.

As part of the GS1 system, which is responsible for the introduction of the Universal Product Code (UPC) standard and maintains standards for Electronic Data Interchange (EDI), Barcodes, and Radio-Frequency Identification (RFID), the GLN sits within an organisation with over 1 million user companies in 150 countries, enhancing efficiency and accuracy in operations worldwide.

When did they start being used and why?

The GS1 standards, including the GLN, have been in use for several decades. GS1 was founded in 1974, and since then, its standards have become integral to supply chain management worldwide. 

GLN aims to enhance traceability and visibility throughout the supply chain. The goal is to facilitate more precise communication in computer-based supply chain processes.

What do they identify?

The GLN provides a clear and standardised way to identify parties and locations throughout the supply chain.

Key terms for GLN

Understanding how a GLN works can be tricky at first. Getting your head firmly around it involves knowing some specific terminology, such as:

Party: An entity engaged in a business-related transaction.

Legal entity: Any business, government body, department, individual, or institution recognised by law and capable of contractual agreements.

Functional entity: A department carrying out specific tasks within an entity like accounting or purchasing.

Physical location: A real-world location represented by an address or coordinates.

Digital location: An electronic, non-physical address, such as an (EDI) gateway.

When and where are they used? 

GLN is used whenever the identification of a party or location is essential and employed within databases and information technology systems to uniquely identify and organise parties and locations. They’re integral to business transactions, and accurately identifying involved parties and their respective locations.

What is the business impact?

The utilisation of GLN numbers brings about several impactful outcomes for businesses including consistent and standardised identification that enhances communication efficiency, in addition to accurate data exchange. This also results in cost reduction. GLNs also contribute to establishing reliable party and location information and are globally unique and interoperable, helping businesses meet regulatory requirements in a variety of sectors. 

All GLNs consist of a 13-digit number containing three constituent components. However, the GLN type varies depending on what it identifies. Although all GLNs begin with the Company Prefix, they may differ in identifying either a physical location (GLN-L) or a functional business entity (GLN-F). 

Company prefix

The GS1 standard company prefix is globally assigned to a business by a GS1 member organisation. Its length varies depending on the business’s needs.

Location reference

The location reference is not logic-based. Assigned by the user, it identifies either a function within an entity, a physical location, or a digital location. Its length varies based on the company prefix, which combined, totals 12 digits. 

Check digit

The final 13th digit in the GLN is the check digit, used to verify that the data is composed correctly. 

Peppol iD

In the Peppol (Pan European Public Procurement Online) network GLN is called Peppol ID. The Peppol IT network uses the same GLN identifier under the nomenclature of Peppol ID.

Trading partner identification and management

GLNs are extensively used for identifying and managing trading partners within the supply chain. Each trading partner, such as suppliers, manufacturers, distributors, and retailers, can be assigned a unique GLN.

Business partner identification and management

Similar to trading partners, GLNs are crucial for identifying and managing various business partners within an organisation. GLNs may be assigned to different business units, departments, or divisions, referred to as functions.

Digital location reference in electronic data interchange (EDI)

GLNs serve as digital location references in Electronic Data Interchange (EDI) systems. With EDI systems business documents such as purchase orders, invoices, and shipping notices are exchanged electronically between trading partners using the GLN.

Electronic business messages or addressing documents

When businesses communicate electronically, GLNs are used as part of the addressing system to specify the sender, receiver, and relevant locations involved in the transaction.

Postal address verification

Although distinct from traditional postcodes and addresses, in scenarios where accurate physical location identification is critical, GLNs may be used in conjunction with postal addresses to enhance address verification.

As discussed thus far the benefits of using GLNs are vast. Given how GLNs assign unique identifiers to entities and locations, they allow businesses to establish consistency in how they identify and refer to these elements within their operations, impacting many areas from data management to overall business efficiency. GS1, the organisation behind GLNs, ensures that these identifiers are globally unique and recognised promoting interoperability between trading partners and organisations. 

Standardised identification procedures also improve data quality helping to ensure that the data exchanged between different organisations is accurate and reliable. Having consistent means of identifying trading partners, locations, and entities is crucial in fostering trust among business partners and stakeholders and improving the speed of goods moving through the supply chain.

Optimizing Supply Chain Efficiency with GTIN and GDSN:

In addition to the foundational role of GLNs in supply chain management, the integration of Global Trade Item Numbers (GTINs) and the Global Data Synchronisation Network (GDSN) further enhances the efficiency and accuracy of global trade practices:

• GTIN: A critical element for product identification across the global supply chain, GTINs ensure that every product is universally recognized, facilitating smoother transactions and inventory management. Explore GTIN and its impact.
• GDSN: This network enables the real-time synchronization of product data between trading partners, ensuring that all parties have access to the same, up-to-date information, thereby reducing errors and improving supply chain efficiency. Learn about GDSN benefits.

By adopting these standards, businesses can significantly improve their operational efficiencies, reduce costs, and ensure compliance with global trade regulations, making them indispensable tools in the modern supply chain landscape.

As a cornerstone of the GS1 system, GLNs revolutionise supply chain management, offering standardised identification for entities and locations. With benefits like enhanced efficiency, consistent data exchange, and global recognition, GLNs play a vital role in building trust among trading partners and ensuring accurate and reliable transactions worldwide.