The EDI Basics

On October 17, 2008. By Fran, under Tech Talk.

EDI: Electronic Data Interchange. EDI is computer-to-computer exchange of business documents between companies. It replaces faxing and mailing of paper documents. EDI is used in a variety of industries. In fact, over 80,000 companies have made the switch to EDI to improve their efficiency. Many of these companies require all of their partners to use EDI.

Why does my trading partner now require EDI technology?

Computer-to-computer exchange of information through EDI is much less expensive than the manual operating of paper documents. Fewer errors occur because computer systems process the electronic order documents instead of manually processing the documents by hand. Think about it, the “paper trail” is a very unsafe way of doing business, and keeping records and files is practically obsolete.

In the age of internet, a superhighway of electronic tools has advanced business to greater levels. Transactions between companies work faster and more efficient than using paper documents. Electronic transactions help reduction in inventory, better use of warehouse space, fewer out-of-stock problems, and lower freight charges. EDI orders can take as little as one day to process and exchange business transactions.

What do I need to use EDI?

To become EDI capable you will need some type of computer. Many types of computers can be used to become EDI capable, from a personal computer to a mainframe system. You will need to select the computer that best meets your business needs.

• A Windows based computer
• Internet communication
• Laser printer
• Remote access software

What does the term EDI compliant mean?

EDI compliance, or compliant, is the ability to send and receive EDI documents in the way that your partner requires it.

Pretty simple right?

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