What is EDI?

Electronic Data Interchange (EDI) is the computer-to-computer exchange of business documents in a standard electronic format between business partners. 

What documents can be exchanged via EDI?

The most common documents exchanged via EDI are purchase orders, invoices and advance shipping notices. But there are many others such as bill of lading, customs documents, inventory documents, shipping status documents and payment documents. 

What EDI standards are there?

There are several EDI standards in use today, including ANSI, EDIFACT, TRADACOMSand ebXMLFor each standard there are many different versions such as ANSI 5010 or EDIFACT version D12, Release A. 

Why are EDI standards needed?

Since EDI documents are processed by computers instead of humans, a standard format must be used so that the computer will be able to read and understand the documents. A standard format describes what each piece of information is and in what format (e.g. integer, decimal, mmddyy). 

How does EDI work?

Sending EDI documents involves three steps:  

Step 1: Prepare the document 

Step 2: Translate the document into EDI format 

Step 3: Connect and transmit your EDI document to your business partner 

Main disadavantages of EDI

  • Lack of flexibility: Restrictive standards and formats 
  • Expensive for businesses and their connected partners 
  • Not all trading partners can connect to EDI 
  • Complex technology 

Alternative to EDI: The Netfira Platform 

EDI solution vs. the Netfira Platform

 

EDI 

Netfira Platform  

Basic functions  

Transmission of standardised data  

Automatic document and data processing including all document types  

Flexibility  

Document exchange based on restrictive standards and formats  

No standards or formats  

Costs for connected business partners  

Too expensive for a lot of suppliers 

No costs for connected trading partners 

Project costs  

Time-consuming and costly to set up  

SaaS solution: quick implementation and low costs  

Connection of business partners 

Not all partners can connect, high barriers 

All important partners can connect easily and quickly 

Technology  

Complex, IT or external EDI service provider needed 

Netfira Onboarding App: business partners can be connected without IT or external service providers  

Blog

The challenge with unstructured order confirmations

Purchasing departments are met with a flood of order confirmations and need to manually enter this important but often unstructured information into their system. Intelligent digital solutions help automating this process.