What Is EDI and How Is It Used?


What Is EDI and How Is It Used?

Is Your Current Warehousing Provider Utilizing the Latest Electronic Data Technology?

Electronic Data Interchange (EDI) refers to a means by which businesses replace paperwork and the sharing of physical documents with the use of electronic documents.

The use of this technology has found its way into the logistics industry. Let’s look at how this solution is used in logistics and its benefits.

What are the standards of EDI?

EDI standards is a broad term used by software developers to describe templates used in EDI. These are standard across all platforms on which they are to be used or, if not, can easily be suited to the businesses that use them. EDI standards are necessary if business communication is to be effective, especially for logistics companies.

What are the types of EDI?

There are several types of EDI that a logistics company can work with. The following is a list of some of the most common EDIs.

  • Direct EDI – Also known as point-to-point EDI, this is a prominent EDI that allows a business to deal with each of its partners as separate individuals. This is very beneficial for a business that partners with several logistics companies or a logistics company that partners with many businesses. Each business can book work, manage its account, and send invoices without interfering with another business on the same platform.
  • EDI via AS2 – This is a type of EDI that allows documents and data to be shared over the internet. It continues to gain market in the logistics industry because of its ability to connect with several computers.
  • Web EDI – This is an even better form of the EDI via AS2. This type of EDI allows access of documents via an ordinary browser.
  • EDI outsourcing – Here, a firm chooses to hire another one to help it manage its EDI systems. This is common for many businesses that may need EDI services without the capacity to set up in-house teams.

What is the Importance of EDI?

If you are asking yourself, what is the importance of EDI, anyway? Then, to answer your question, the word ‘efficiency’ comes to mind.

EDI helps to streamline logistics services and allows easy record keeping and sharing of files. This allows for more efficiency in the handling of value tasks that help make logistics more possible.

What are the Benefits of EDI?

Aside from its importance in improving the efficiency of a logistics company, EDI also benefits a company in other many ways.

  • Saving on costs – Logistics firms don’t need to set aside a massive budget for printing and mailing of documents. With EDI, the files can be shared with clients instantaneously.
  • Time-saving – Compared to the past, when the document had to be crafted from scratch and then submitted to clients, EDI increases efficiency and cuts down on lost time. EDI systems have in-built templates that help make work easier.

Why EDI?

EDI is an aspect of technology that can’t be left behind in today’s logistics industry. If a  logistics company is to streamline its transactions with clients, EDI is necessary.