Electronic Data Interchange: Its History & Future

When you hear the phrase “electronic data interchange,” it sounds like it’s a new and cutting-edge technology. True enough, EDI has grown to include batch document processing for businesses ranging from parts suppliers to grocers. However, EDI has been around for decades. Electronic data interchange has its origins in military supply chains. In the 1960s, a gentleman named Ed Guilbert introduced this technology in the US Army. Then, in the 1990s, EDI began taking off as a significant way for businesses to communicate transactional documents. Today, it is the way businesses interact regarding documents such as purchase orders, invoices, and other documents that would traditionally be sent in the mail.

EDI compliance: What this means in 2022

There is a trend that has been around for quite some time called “EDI compliance.” Retailers such as Home Depot, Walmart, and Costco require that their vendors be EDI compliant. Large companies keep EDI compliance as one of their requirements because EDI:

• Reduces cost
• Makes accounting easier
• Makes inventory management more effortless.

If your business wants to attract new large partners, then EDI will be a requirement in the future. 

Why is EDI so important? 

Retailers insist on EDI compliance because it makes their business run more efficiently. First and foremost, it reduces the likelihood of human error. For example, a retailer can communicate inventory needs, ensuring that they get the exact number of a specific item, eliminating the potential for out-of-stocks. Additionally, EDI means faster inventory replenishment. When a major retailer such as Walmart sells a high volume of a particular product, EDI helps them get more of that product quickly. 

What are the requirements for businesses to use EDI? 

Any business can use an outsourced EDI partner like Integration, Inc. Outsourcing your EDI is affordable and scalable. For example, let’s say you start with one trading partner and seek to expand in the future to include more; Integration, Inc. will help you comply with their EDI requirements. A standard called ANSI X12 is considered pretty standard in the industry. We ensure that your business can map all its documents onto what each business partner is doing. 

Choose Integration, Inc. as your EDI partner

EDI is not a new concept. Integration, Inc. has been helping businesses of all sizes with EDI for about 30 years. EDI was a significant force behind globalization, and Integration, Inc. strives to help companies to move into the 21st century. So if you are looking for a trusted EDI partner, look no further than Integration, Inc.

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