What Is EDI?

what is edi software?

EDI is also known by its longer version – Electronic Data Interchange, but what is EDI and how can it impact your business? EDI is now the driving force behind the majority of B2B companies today. However, that doesn’t mean it’s only for large businesses. In fact, even SME’s now have access to the benefits of EDI, including:

  • Cost Saving
  • Faster Commerce
  • Greater Data Accuracy
  • Improved Productivity

And far more as you will learn soon!

With all of these benefits available for businesses of all sizes – it is no surprise why more and more companies are asking “What Is EDI?” We’ll break it down to the absolute basics and explain exactly what it is.

What Is EDI Software?

The Benefits Of EDI Software

Common Misconceptions Of EDI

Find The Right EDI Software

business software

What Is EDI Software?

Our technology advances and adapts at astonishing speeds. This provides an enormous advantage, but can leave people a little… confused. For example, computers made theses and essays far easier to create than a typewriter, but to this day hopeful graduates still struggle with formatting documents into pages or docx.

But for B2B companies there is a whole smorgasbord of technological options available – and no understanding professors to grant leniency.

In business there is no room for confusion, delay or miscommunication. Your business needs to process orders, collate invoices, stay up-to-date on inventory and manage shipping notifications. Delays and mismanagement are unacceptable as they can damage your business.

This is where Electronic Data Interchange comes in. So what is EDI software used for?

In layman’s terms Electronic Data Interchange (or EDI for short) is an efficient computing translator. It sets up a “conversation” between two endpoints, regardless of the language each system uses. This means that between businesses it:

  • Establishes protocols, documents, transactions and endpoints for data exchange
  • Converts data into your own back-end formats for company use

In summary, an interaction without EDI would look something like this:

Without EDI Integration

While this is a potential way to run a business, it isn’t exactly the most efficient is it? That’s why the right software transforms it into this:

B2B process with EDI software

What Are The Benefits Of EDI Software

When you asked “what is EDI?” We told you that the software sets up a “conversation” between two different B2B businesses. However, that was a mild simplification of the process. The truth is that this simple little tool comes with a whole host of benefits that directly impact your business.

That’s right – measurable effects that can streamline your workflow and boost productivity. So let’s take a quick look at those.

Cost Saving

Every business, from large chains to small independents, has administrative costs. Paper, printing, postage, storage, filing, document management etc.

When EDI software is involved, that all changes. You immediately reduce your overhead and administrative, resource and maintenance costs.

Faster Commerce

An EDI integration completely revamps your entire business process. Due to the near instantaneous information processing, your business immediately becomes more efficient.brand building

No more back-and-forth emails, follow-up messages, chasing down staff members and tedious manual input. You now have zero last-minute deadlines on hold to confirm with partners. In fact, Matson Logistics is a well-known example – they actually lowered their transaction costs by 35% by using EDI alone!

Simply the power of automated business tools across all of your business dealings. 

Greater Data Accuracy

EDI removes the need for manual data entry immediately. This means that human fallibility is removed, but it doesn’t stop there. It goes much further.

Your employees can print out invoices and shipping orders perfectly with no numerical mishaps. However there are still some crucial data points that can cause serious issues between different B2B companies. These include:

  • Inconsistent Formats 
    • Dates as DD/MM/YYYY or MM/DD/YYYY)
  • Numerical Disagreements 
    • Values are in alternate decimal places, or use commas instead of full-stops
  • Formatting Errors
  • Disparate technologies now work as a single application network

 EDI is what can solve these issues in a single stroke!

Improved Productivity

Suddenly, the work schedule became a great deal less hectic.

Now your business lacks the need for manual data entry. You don’t require staff to double and triple-check the manual data. Not to mention, you don’t have to be ready for any extra hours to deal with the surprises that come from these mistakes.

You could of course give everyone a break, have some coffee and catch up on the latest celebrity gossip with this extra time.

Or, you and your team can invest those hours into more productive and vital aspects of your business. Now your workforce no longer have to deal with the mundane, time-consuming tasks that have otherwise taken over their daily work schedule!

Common Misconceptions of EDI 

There is a huge amount of misinformation online about EDI. Some say that it EDI is outdated, it’s cumbersome and a huge drain on resources. We’re here to set the record straight.

We have compiled some of the most common “drawbacks.” So let’s clear up these myths once and for all.

Myth #1 “It requires an enormous amount of experience in coding and a large team to maintain”

Truth: Anything is difficult if you don’t choose the right software. A fully integrated EDI solution does not require this. The tool is designed to make businesses run smoother and provides much needed support for your workforce!

Myth #2: “EDI solutions need constant changes to maintain scalability”

Truth: The right EDI solution is fully scalable with your business, and this is the first item that you should check when reviewing a new software. As your business grows, so too should the EDI automatically adapt to your needs.

Myth #3 EDI software is outdated and only a few companies use it!

Truth: Currently, around 60-85% of businesses use EDI solutions regularly – that doesn’t sound like a minority to us.

What Is The Best EDI Software?

EDI solutions only offer benefit after benefit to your business, it’s what you do with the extra time on your hands after that, that will define your business. With the amount of advantages on offer to both B2B and small businesses, you need a solution that not only integrates easily, but is flexible and will scale up as your business grows.

Not to mention, that you also need a software that provides top-level security for all your communications!

That is where this EDI solution comes in.

Our EDI software one of our top-performing products and helps businesses across the globe make the most out of their company. Data errors, delays and miscommunications in your day-to-day business endeavours are a thing of the past. Once you’ve integrated it, simply strategise to scale up your business in no time at all!

Simply get in touch with a member of our team today to discuss your needs and questions! Don’t forget to check out our resources to find other guides and tips for your eCommerce business!

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