Electronic Data Interchange, commonly referred to as EDI, is the integration set up between two businesses. While the retail and supply chain industries employ the use of EDI most frequently, EDI can be used to integrate an array of companies in a wide variety of industries.
Most EDI implementations are initiated by a supplier integrating their systems with the retailers (also referred to as trading partners) they trade with. Usually, a supplier becomes an approved vendor for a retailer and is required to set up an EDI connection in order to start trading products. This is standard practice, especially among larger retailers.
Can an API be used to achieve the same goal as EDI?
Yes, if the integration partners have an API available to connect with.
An Application Programming Interface, also known as an API, enables business systems to connect to each other in real-time. APIs and EDI can both be used to achieve the same goal of integrating vendors to the retailers they trade with, any business systems they use, and connecting them with third-party logistics (3PLs) if needed. Using an API to set up a new EDI integration is contingent on the ERP, Retailer, 3PL, etc. having an API available to connect with.
An API is considered to be a communication method that facilitates an EDI connection; however, APIs are capable of more than that. An EDI integration built with an API is flexible and offers companies more customization options that go beyond the scope of standard EDI.
If a vendor needs to set up a new EDI connection with a retailer that has an API available, and the vendor has unique requirements that require a customized setup, then finding an EDI solution provider capable of creating the integration with an API is paramount.
Is there any benefit to EDI?
Absolutely. EDI both improves the efficiency of your business, saves your staff time, and saves your company money. Some of these benefits include:
- Eliminate Chargebacks: Avoid costly chargebacks and dues because of EDI non-compliance and manual data entry errors.
- Improve Accuracy: Make your business more efficient by preventing data entry mistakes caused by human error.
- Reduce Labor Costs: Automate your data entry and management for a fraction of the time and cost.
- Real-Time Error Monitoring: An EDI service provider will be able to actively monitor functional acknowledgments to ensure documents are successfully transmitted.
- Lower your Overhead & Get Paid Faster: Improve your ROI and expedite your shipping and cashflow cycles with electronic invoicing.
Can I set up EDI myself?
Yes, but not easily. Setting up EDI internally is both very time-consuming and if set up improperly, your company will run the risk of incurring expensive chargebacks from the retailers your company trades with. By outsourcing EDI, your company will ultimately save a substantial amount of time and money. A fully-managed EDI provider will be able to properly complete the initial EDI setup and testing, as well as proactively handle the necessary ongoing error monitoring, maintenance, and updates mandated by retailers.
What should I look for in an EDI Solution Provider?
Your company should be looking for an EDI Solution Provider that meets the criteria listed below:
- Fully-managed EDI service that allows your company to focus on your own business.
- Support that will always be available anytime day, nights, weekends, or holidays.
- Training provided by a dedicated project manager during the EDI setup process.
- Flexible to the needs of your business, enabling your company to grow.
- Competitive and transparent pricing.
- Proactively implement EDI updates mandated by all retailers your company trades with no interruption or additional cost.
- Capable and proven record of servicing a wide range of industries, business systems, EDI documents, EDI standards, and company types from across the world.
- Experience setting up integrations with any communication method, such as API.
What do I need to get started?
A supplier will need to be approved as a vendor by a retailer to be able to complete the process of setting up an EDI connection, however, the overall process can be initiated much sooner. Selecting an EDI solution provider shows buyers on RangeMe that your company is committed to fulfilling their EDI requirements, avoiding delays from trying to find an EDI provider after having selected your product.
Specific requirements for an EDI setup beyond being approved as a vendor will differ by factors such as services being integrated, the retailers your company trades with, whether your company uses a third-party logistics warehouse for shipping or if you handle it yourselves, and more. To get a detailed idea of which specific requirements your company will need to get started, reach out to an EDI solution provider to learn more.
If I have an obscure, custom, proprietary Accounting Package / ERP, or no ERP, can I still get EDI?
Yes. The ability to set up integrations without an accounting package or alternative EDI integrations may vary among EDI solution providers in the industry.
In order to be sure your integration can be set up to your company’s needs, it’s important to research and vet EDI solutions providers. Speak with their staff to determine whether they’ll be able to accommodate you. While vetting EDI solutions providers, it’s worth looking for sales staff that are fully transparent about any limitations they may run into when integrating with an alternate system.
An exclusive discount is available for all premium RangeMe users:
When you select B2BGateway as your EDI solution provider through RangeMe, we’ll offer you an exclusive discount.
- Receive a 50% discount on the first EDI setup
- We’ll waive the first 2 months of the monthly support fee
Where can I learn more about EDI?
See below for some links to commonly requested information:
- What is EDI? (video)
- Learn about EDI
- EDI Frequently Asked Questions
- EDI Solutions for Suppliers
- EDI Definitions and Glossary
- EDI Documents
- EDI Standards
If you have any questions, please reach out to our expert sales staff by phone at (401) 491-9595 Ext. 5, or by email at Sales@B2BGateway.net.
About the Author:
Since 1999, B2BGateway has been providing organizations with EDI & API Connectivity solutions. B2BGateway has a proven record of providing clients with the hassle-free, on-time solutions that save companies time and money by eliminating costly mistakes that result from the manual rekeying of data. Read more about B2BGateway on our website.