What is Electronic Data Interchange

Jun 22, 2017

What is Electronic Data Interchange (EDI) and will it benefit my business?


What is Electronic Data Interchange and will it benefit my company? Electronic Data Interchange (EDI) utilizes a standardized formatting of information in order to successfully exchange documents securely between businesses. Gone are the days of using paper copies to exchange data between companies. Implementing EDI into your business processing model offers many benefits and streamlines the process of document exchange between businesses.

Some of the most valuable reasons you should be using EDI in your business include:

EDI provides businesses with better decision-making capabilities

EDI enables your business to gain real-time access to vital business information, such as the transaction status of orders, cancellations, and even issues within the system. EDI affords your business the capabilities to make better and faster decisions. This is especially true when handling orders that may need changes at the last minute.

EDI offers businesses more positive relationships with business partners

Company priorities often include maintaining solid relationships with various business partners. Keeping these relationships is typically based on whether or not the partnership is beneficial for both parties. Using EDI within your business allows clear communication channels to partners, keeping orders organized and on-time. When orders are incorrect, delayed, or lost, this can easily lead to partner disputes and dissatisfaction, which can irreversibly damage the reputation of your organization, and end business partnerships.

Using EDI offers your business a very easy way to avoid this type of end-result. Using EDI within your business allows both partners to choose the appropriate formats for documents being exchanged, so there are no issues with compatibility.

EDI offers increased efficiency and productivity within your business

Implementing EDI into your business greatly increases efficiency in your business. Many businesses waste time working with software their business partners do not. Having to go back and forth to try and correct a problem or approve new details can be an enormous waste of time and something that can be completely avoided when using EDI. In fact, compatibility problems are often times a huge issue when EDI is not being used within a business. When your business sends a document to a business partner (e.g. invoice, advance ship notice or custom document) it is important to know they’re going to be able to receive it securely, open it and use it.

EDI is cost-effective

Finally, one of the biggest benefits of using EDI is the money it can save your business.

According to current industry research, implementing EDI costs only a fraction (1/3) of what using paper-based exchange costs. There are many ways using EDI in your business can save your company money:


  • EDI offers an immediate savings on the use of paper and postage, which can add up quickly and in large volumes, especially in larger companies.


  • EDI saves businesses a great deal of time by streamlining the order processing system, which includes sending documents back and forth between business partners.


  • Using EDI allows businesses to drastically reduce inventory levels. Not only is your business able to save on stocking inventory, but your business may also be able to consider utilizing a smaller warehouse for inventory to be housed.

To find out more about how EDI can increase your business productivity in a cost-effective way, while improving your business partner relationships, contact Integration, Inc. today.

Integration, Inc. is an industry-leading business process automation provider specializing in business process automation services, such as Electronic Data Interchange (EDI), check writingcheck printingcheck processingrebate processingbarcode labels and third party billing to thousands of companies across the globe.

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