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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 ebXML. For 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
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EDI |
Netfira Platform |
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Basic functions |
Transmission of standardised data |
Automatic document and data processing including all document types |
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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 |
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Project costs |
Time-consuming and costly to set up |
SaaS solution: quick implementation and low costs |
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Connection of business partners |
Not all partners can connect, high barriers |
All important partners can connect easily and quickly |
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Technology |
Complex, IT or external EDI service provider needed |
Netfira Onboarding App: business partners can be connected without IT or external service providers |