What Does it Mean to be EDI Capable?

EDI is a method of exchanging data between different organizations. It’s a way to automate processes so that they happen automatically.

What Does it Mean to be EDI Capable

What Is EDI Capable?

EDI capability refers to the ability of a business to use EDI to send and receive EDI documents electronically. This includes things like whether the company has the software needed to send and receive EDI messages.

To become EDI capable there are two options, either running an EDI solution on-premises in an own or 3rd party data center or buying the EDI capability as an EDI cloud service.

It’s crucial for an enterprise to be able to send and receive electronic documents like EDI X12, VDS, Tradacoms, and more. When your organization is EDI capable, you are at an advantage in the business world with a greater chance for success. Utilizing these standard data formats is the most significant aspect of EDI since the exchange of documents will be effective only if both, the sender as well as receiver systems are working with similar data formats.

Being EDI capable means the ability for businesses to exchange business documents/data with their trading partners electronically such as,

  • Invoices
  • Purchase orders
  • Advanced ship notices
  • Bills of lading
  • Inventory documents
  • Customs documents
  • Shipping documents
  • Payment documents

 

Why Should You Care About being EDI Capable?

If you work with any type of business, you should care about EDI because it allows companies to communicate more efficiently. EDI helps businesses save money and time by reducing errors and increasing efficiency.

How Does EDI Capable Work?

EDI works by exchanging documents electronically. This means that instead of sending paper copies of contracts, invoices, and other documents, businesses send them digitally through email or online portals.

There is a 3-step process for EDI Capability,

  1. Connection to ERP - Receive messages in internal format from the ERP system
  2. Conversion - Transfer messages from the internal format to the message standard
  3. Communication - Technical dispatch via the agreed communication protocol

ANSI ASC X12 EDI Standard - Commport Communications

How Does Making your business EDI Capable Benefit Your Business?

EDI has been around since the 1970s, but its use has only increased in recent years. In fact, according to a study conducted by the U.S. Census Bureau, more than half of all companies now use EDI. That number is expected to continue increasing as more businesses adopt new technology.

Being EDI capable is an advantage. Retailers seek out EDI-capable suppliers when considering new items. They focus on relationships with those who are ready with EDI. And you’ll fast-track the onboarding process, so your products are in stores and online sooner.

Generally, pretty much any organization, substantial or little, can receive the rewards of EDI Capable. Other than offering an institutionalized communication for regular business report exchanges (functional acknowledgments (EDI 997), freight receipts (EDI 310), payment order/remittance advice (EDI 820), and inventory inquiry (EDI 849)) that can streamline business work processes and locally available accomplices rapidly, we know EDI solutions have the innovation to convey in five imperative ways: Funds savings, speed, precision, effectiveness, and security.

Here are the benefits of becoming EDI capable,

  1. Increase efficiency and accuracy through automation
  2. Be ahead of your competition
  3. Pack and ship orders faster
  4. Ability to transact with more partners
  5. Heightened security
  6. Faster processing speed
  7. Better for the environment
  8. Reduce cost

 

EDI is the future. It represents automation at its finest, allowing you to save time and money. An EDI-capable enterprise can process data interchange almost instantly and without error. A human in the same role simply cannot complete.

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