What is EDI?
Electronic Data Interchange (EDI) enables the exchange of business documents between organisations in a
standardised format. This brings many benefits and makes the process of document exchange between
businesses much simpler.
How EDI works
EDI enables companies with different hardware/software systems to exchange business documents in a common format. To facilitate this,a business needs access to an EDI solution.This allows the exchange of EDI transactions with customers and suppliers.
An example scenario:
- A sender business raises a Purchase order
- This is converted into an EDI format and then transmitted to their supplier electronically
- The supplier receives the data as a Sales Order in EDI format
- The Sales Order can be read, printed or processed into an accounting system
- The Order can now be turned into an invoice which can be sent back to the customer electronically using EDI
Benefits of using EDI
Electronic Data Interchange (EDI) has many benefits and operational advantages for supporting the exchange of business documents with trading partners.
Below are some of the biggest reasons you should be using EDI in your business.
- Using EDI is cheaper than traditional paper based methods
- Business can eliminate manual entry and reduce errors.
- A manual workload is lifted which can free up office resource
- Establishes better relationships with business partners
- Increases operational efficiencies and data accuracy
We’re alerted to when new orders are received which notifies us that it has been integrated to Sage. The automation does make life a lot easier.”
Colin Clitherow, Filippo Berio.
A business should ask the following questions when considering an EDI system
Who are my trading partners
A business will need to identify which customers and/or suppliers they will be trading electronically with. In addition, other business area and functions such as logistics providers, warehouse systems can also be streamlined by using EDI.
Which business documents do I want to exchange
A wide variety of business processes can be supported via EDI messages. Sales & Purchase Orders, Invoices, Despatch Advices, Payments. This question will depend upon which trading Partners will you be exchanging messages with.
Do I need to integrate my EDI or just turn around
A business can begin with a simple service to support sending/receiving messages with trading partners or an Integrated solution that will seamlessly link the business messages into a back office accounting system
Traditionally, EDI products have been on premise meaning a business will provide their own hardware on which an EDI application will be installed and operated. The business will generally operate their own EDI operation and maintain it day-to-day.
Over the last couple of years, more efficient and cost effective solutions have been introduced into the market helped by the dawn of cloud computing. As with other sectors, B2B is seeing an increasing shift towards cloud based platforms.
Most companies today increasingly prefer a Managed Service that allows a business to outsource their EDI operation to a third-party. The Managed Service provider will host the EDI infrastructure and provide their own expertise to ensure the day-to-day EDI operation can be maintained on the clients behalf. Read here for more.
At NetEDI, we provide cloud-based EDI Managed Services that enable a user to access the platform via the web. A user can view, print and process their business documents wherever there is access to an internet connection and browser.
Select a NetEDI Solution below to find out more
For smaller businesses seeking to gain the benefits of EDI without the investment, the Starter solution can receive and turnaround EDI data using only a web browser.
For businesses integrating EDI data into ERP and accounting systems. NeTIX Professional provides a fully managed cloud platform for your EDI and integration needs.
Designed with performance and reliability in mind, NetIX Enterprise is a fully managed, enterprise-class, cloud platform designed with high workload and security in mind.
Need assistance? We can help.
If you need any help with getting started, which product you need, or anything else, please let
us know. NetEDI are on hand ready to help.