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All You Need to Know About EDI 943 – Warehouse Stock Transfer Shipment Advice

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EDI 943 – Warehouse Stock Transfer Shipment Advice

EDI 943: Introduction

This article has been created by the expert team at EDI2XML, a trusted EDI provider with 20+ years of experience. Its purpose is to help companies understand the EDI 943 Warehouse Stock Transfer Shipment Advice better. Our goal is simple: we want to give businesses accurate information and show them how to exchange this important EDI document and improve their supply chain and inventory management.

What is EDI 943?

The EDI 943 Warehouse Stock Transfer Shipment Advice is an electronic data interchange (EDI) transaction set used in supply chain, logistics, and 3PL to transmit information about the shipment of goods from one warehouse or location to another.

What is EDI X12 943 Format?

The EDI 943 format refers to the structured layout or template used for creating and exchanging the EDI 943 Warehouse Stock Transfer Shipment Advice document electronically. It defines the specific arrangement of data elements and segments within the document.

The format typically follows a standardized EDI format, such as those established by ANSI (American National Standards Institute) and ASC X12 (Accredited Standards Committee X12). These formats outline the exact sequence and structure of data fields, including sender and receiver information, item description, quantities, shipping instructions, and other relevant information.

What is EDI X12 943 Specification?

Specifications for the EDI 943 outline the specific data elements, segments, and syntax rules that must be followed when creating and exchanging an EDI 943 document.

Here are some key components typically covered in an EDI X12 943 specification:

Message Structure: It defines the overall structure of the EDI 943 message

Segment Definitions: The specification lists all the segments used in the EDI 943

Data Element Definitions: For each data element within the segments, the specification provides information about the data type, length, and usage requirements (mandatory or optional).

Code Sets: It includes code lists and values for specific data elements.

Syntax Rules: The specification outlines syntax rules for delimiters, segment terminators, and other technical aspects of the X12 format to ensure proper parsing and interpretation of the message.

Data Elements in an EDI 943 Warehouse Stock Transfer Shipping Advice

In an EDI Warehouse Stock Transfer Shipping Advice (EDI 943) document, several key data elements are essential for accurately conveying information about the shipment of goods between warehouses or locations within the supply chain. These data elements help trading partners understand and process the shipment effectively. Here are the key data elements typically included in an EDI 943:

Transaction Set Header (ST)

Transaction Set Control Number: A unique identifier for the transaction set.
Transaction Set Identifier Code: Indicates that it is an EDI 943.

Warehouse Information (W06)

Warehouse ID: A unique identifier for the warehouse or location sending the shipment.
Shipment Identification: A reference number or code for the shipment.
Shipment Date: The date when the shipment is prepared.

Name Segments (N1)

Ship To (ST): Information about the receiving warehouse or location.
Ship From (SF): Information about the sending warehouse or location.

Reference Numbers (N9)

Customer Order Number (CO): The customer’s order reference.
Location (LU): Internal location or facility code.

Date Segment (G62)

Requested Ship Date: The date when the shipment is requested or expected to be shipped.

Carrier Information (W27)

Carrier Code: Code representing the carrier or transportation mode

Item Detail (W04)

Quantity Shipped: The quantity of items being shipped.
Unit of Measure (UIT): The unit of measure for the quantity (e.g., “EA” for each).
Item Identification: Product identifier (e.g., UPC or SKU).
Product Description: Description of the item being shipped.
Vendor Item Number: The supplier’s item number.
UPC/EAN/GTIN: Global Trade Item Number or barcode.
Product Condition: Indication of item condition (e.g., new or used).

Return Management (N9)

Return Instructions (RM): Any specific instructions or information regarding returns.

Item Warehouse (W03)

Additional item or shipment details specific to the warehouse.

Transaction Set Trailer (SE)

Number of Included Segments: Total number of segments in the transaction set.
Transaction Set Control Number: Repeats the control number from the ST segment.

Functional Group Trailer (GE)

Number of Transaction Sets Included: Total number of transaction sets within the functional group.
Group Control Number: Repeats the control number from the GS segment.

Interchange Control Trailer (IEA)

Interchange Control Number: Repeats the control number from the ISA segment.
Number of Included Functional Groups: Total number of functional groups in the interchange.

These data elements collectively provide comprehensive information about the warehouse stock transfer shipment, including sender and receiver details, item specifics, shipment dates, and any relevant references or instructions. Trading partners rely on these elements to process, track, and manage inventory transfers efficiently within the supply chain.

EDI 943 Example Transaction

ISA*00**00**ZZ*SENDER ID *12*RECEIVER ID*230330*1549*|*00401*100000008*0*P*}~
GS*AR*SENDER ID*RECEIVER ID*20230330*1549*1008*X*004010~
ST*943*1080~
W06*1*123456789012*20220316*RA-100179**Test-12345~
N1*ST*Warehouse – GXO*91*MPD001~
N1*SF*Supplier Inc.~
N9*CO*US300008521~
N9*LU*MPD001~
G62*04*20220409~
W27*A*FED~
W04*1*EA*123456789***ABCD12345*******UP*689122008877~
N9*QA*QA Hold~
W03*1~
SE*12*1080~
GE*1*1008~
IEA*1*100000008~

Please note that this example contains generic placeholders and serves as a simplified illustration of an EDI document’s structure. In a real-world scenario, the data content would be specific to the business transaction.

Practical Applications of the EDI 943 Warehouse Stock Transfer Shipment Advice

The EDI 943 Warehouse Stock Transfer Shipment Advice is used to facilitate and streamline the transfer of stock or inventory items between different warehouses or locations within a business’s supply chain. Here’s how it is typically used:

Initiating a Stock Transfer

The process usually begins when one warehouse or distribution center (the sender) decides to transfer a specific quantity of goods to another location within the same company or to a different company (the receiver). This transfer may be due to various reasons, such as optimizing inventory levels or redistributing stock to meet demand in different regions.

Generating the EDI 943

Once the decision to transfer stock is made, the sender’s internal systems (ERP/CRM) or EDI software generate the EDI 943 Warehouse Stock Transfer Shipment Advice document. This document contains all the necessary information about the planned stock transfer, including item details, quantities, shipping instructions, and relevant dates.

Transmission to the Receiver

The sender electronically transmits the EDI 943 document to the receiver using a secure and standardized EDI communication method, such as AS2, FTP, or VAN (Value Added Network). Important: Both the sender and receiver must have compatible EDI systems in place to send and receive EDI transactions.

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Receiver Acknowledgment

Upon receiving the EDI 943, the receiver’s system acknowledges the document, confirming its receipt with EDI 997 Functional Acknowledgment. This acknowledgment helps ensure data integrity and that both parties are aware of the upcoming stock transfer.

Preparing for Shipment

After acknowledging the EDI 943, the receiver (warehouse) prepares to receive the stock. This may involve making space, arranging for the shipment’s arrival, and ensuring that the information in the document matches their own records.

Stock Shipment

The sender ships the specified inventory items according to the details provided in the EDI 943, including the shipping method and carrier information.

Receiving and Confirmation

Once the goods arrive at the receiving location, the receiver checks the incoming inventory against the information in the EDI 943 document then, send an EDI 944 Receipt Advice as confirmation. This document includes shipment details, discrepancies, and notes about damaged or defective products.

Inventory Updates

After the successful receipt of the stock transfer, both the sender and receiver update their inventory records to reflect the changes. This ensures accurate inventory management and visibility throughout the supply chain.

Keep in mind, that the EDI 943 is not limited to a specific type of business entity and can be used by various parties within the supply chain, including manufacturers of goods when a manufacturer needs to transfer goods from its production facility to a warehouse for storage, distribution, or order fulfillment.

What is The Difference Between EDI 943 and EDI 944?

The primary difference between EDI 943 (Warehouse Stock Transfer Shipment Advice) and EDI 944 (Warehouse Stock Transfer Receipt Advice) lies in their purpose and the direction of information flow:

EDI 943 (Warehouse Stock Transfer Shipment Advice)

Purpose: As we discussed early, the EDI 943 is used to notify a receiving warehouse or location about the impending shipment of goods from a sending warehouse or location within the supply chain.

Direction: Information flows from the sender (the warehouse or location shipping the goods) to the receiver (the warehouse or location receiving the goods). It serves as a notice of what is being sent and provides shipment details.

EDI 944 (Warehouse Stock Transfer Receipt Advice):

Purpose: The EDI 944 is used to confirm the receipt of goods at the receiving warehouse or location, acknowledge the receipt of the shipment, and provide additional information such as any discrepancies or the condition of the received goods (e.g., if there are damaged or defective products).

Direction: Information flows from the receiver (the warehouse or location receiving the goods) back to the sender (the warehouse or location that shipped the goods). It serves as a confirmation and acknowledgment of the receipt of the goods and may include quality and condition-related information.

In summary, EDI 943 is about informing the receiving warehouse of an upcoming shipment, (similar to EDI 856 ASN), while EDI 944 is about confirming the receipt of the goods and providing feedback on their condition.

Both documents are crucial for effective inventory management and supply chain operations, ensuring that all parties involved have accurate information about stock transfers.

What are the Benefits of EDI 943?

Implementing EDI 943 (Warehouse Stock Transfer Shipment Advice) offers several benefits for businesses involved in supply chain and inventory management. Some of the key advantages include:

Efficient Inventory Management: EDI 943 allows for real-time or near-real-time communication between trading partners, enabling better control over inventory levels. This leads to reduced overstocking or understocking of products, resulting in cost savings.

Improved Accuracy: Automating the exchange of stock transfer information through EDI reduces the risk of manual errors, such as data entry mistakes and misinterpretations.

Enhanced Visibility: EDI 943 provides visibility into upcoming stock transfers. Warehouses can plan and allocate resources efficiently, ensuring that they are prepared to receive and process incoming shipments.

Streamlined Processes: Automation of stock transfer notifications streamlines workflows and reduces paperwork. This leads to faster order processing, reduced administrative costs, and improved overall operational efficiency.

Cost Savings: The automation and efficiency gained through EDI 943 can lead to cost savings in terms of labor, paper handling, and reduced errors.

Environmental Benefits: EDI reduces the need for paper-based documentation, contributing to environmental sustainability by minimizing paper waste and reducing the carbon footprint associated with document printing and transportation.

Thus, EDI 943 brings operational improvements, cost savings, and better supply chain management.

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October 11, 2023/0 Comments

The Importance of EDI 862 Shipping Schedule in Streamlining Supply Chain Management

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Introduction: What is EDI X12 862 Shipping Schedule?

In today’s digital world, efficient communication and streamlined processes are paramount for successful supply chain management. One of the key tools that facilitate this seamless exchange of information is Electronic Data Interchange (EDI).

Among the various EDI transaction sets, the EDI 862 transaction, also known as the Shipping Schedule, plays a crucial role in coordinating shipments and ensuring timely delivery.

The Shipping Schedule (EDI 862) provides essential data related to the delivery of goods, allowing suppliers and customers to efficiently plan and manage their inventory and logistics operations.

Let’s explore the definition, structure, standards, processing, and benefits of the EDI 862 Shipping Schedule.

EDI 862 Shipping Schedule – Definition

The EDI 862 Shipping Schedule is a standardized electronic document sent from a supplier to a buyer; it contains specific details regarding the shipping requirements for a particular order or set of orders. It typically includes information such as:

shipment dates,
quantities,
packaging instructions,
carrier details, and other relevant logistics data.

EDI X12 862 (EDIFACT DELJIT) – Structure & Standards

The structure of an EDI 862 document follows the ANSI ASC X12 standard. In the UN/EDIFACT standards, the DELJIT (Delivery Just-In-Time) message performs a similar function. It consists of data segments, elements, and sub-elements arranged in a hierarchical format.

The structure defines the order and format in which the information is transmitted, ensuring compatibility and interoperability between different systems.

ANSI ASC X12 standard is prevalent in North America, while UN/EDIFACT is widely adopted globally.

These standards provide a common language for data exchange, ensuring consistency and compatibility between trading partners.

EDI 862 Shipping Schedule – Processing

The processing of the EDI 862 Shipping Schedule involves the exchange of structured electronic data between the sender and the receiver. Here’s a general overview of the processing steps:

Data Preparation: The shipping schedule data is collected and formatted according to the specific EDI standard, such as ANSI ASC X12 or UN/EDIFACT.

Translation: Data is translated into the appropriate EDI format, usually companies use the services of an EDI Provider. This can be either a Fully Managed EDI Service or an EDI Web Service.

This step ensures that the information is correctly encoded and compliant with the selected standard.

Learn more about how to choose the right EDI solution for you in this article: Business Automation: How to Choose the Right EDI Solution

Transmission: The translated EDI document is transmitted securely by the EDI Provider to the trading partner using a communication protocol such as AS2, FTP, or VAN (Value Added Network).

Receipt and Validation: The recipient’s system receives the EDI 862 document and performs validation checks to ensure the data integrity and compliance with the standard.

Processing and Integration: The received shipping schedule information is processed and integrated into the recipient’s internal systems, such as enterprise resource planning (ERP) or warehouse management systems (WMS).

Acknowledgment: A functional acknowledgment (e.g., EDI 997) is generated and sent back to the sender to confirm the successful receipt and processing of the EDI 862 document.

Sample EDI 862 Data for the Shipping Schedule Transaction Set

The EDI 862 document represents a Shipping Schedule, which provides information about scheduled shipments.

ISA*00* *00* *12*Sender *ZZ*Receiver *210429*0402*U*00401*000000003*0*P*>

GS*SS*Sender*Receiver*20210429*04024783*1*X*004010

ST*862*0001

BSS*00*2019-12-17 13:15:19*20191217*DL*20210429*20210429****P302289

N1*BT*JOHN BLUEINDUSTRIES INC.*92*59940

N3*ATTN: ACCOUNTS PAYABLE DEPARTMENT*PO BOX 47200

N4*HAMEL*MN*55340*US

N1*ST*JOHN BLUEINDUSTRIES INC.*92*WXY5L559

N3*ATTN: RECEIVING*989 Q AVE.

N4*MILFORD*IA*12345*US

N1*SU**92*744551A

LIN*1*BP*MISC

UIT*EA

REF*RE*0**YN>5>ZY>PSS001

PER*EX*Company’s Help Team*EM*email@lcopany.com*TE*1-800-123-123

FST*2*C*D*20210429****RE*0

DTM*017*20200108*0500*CS

DTM*150**1600*CS

DTM*151**1700*CS

DTM*118*20210429

DTM*011*20200107

SHP*38*2*112*20210429

TD3***SHIP DIRECT******1783662

TD5**US*734870*P*17836671780792**59*766736

SE*23*0001

GE*1*1

IEA*1*000000003

Let’s break down the segments and elements within the provided EDI 862 file:

ISA: Interchange Control Header segment. It contains information about the sender and receiver of the interchange, along with control information such as the date and version of the EDI standards used.

GS: Functional Group Header segment. It provides information about the sender and receiver. The segment also includes a group control number and the version of the EDI standards used.

ST: Transaction Set Header segment. It indicates the start of a specific transaction set, in this case, the Shipping Schedule (862).

BSS: Beginning Segment for Shipment Schedule. It contains general information about the shipment, such as the scheduled shipment date, the delivery date, and other relevant details.

N1: Name segment. It provides information about the entities involved in the transaction.

LIN: Item Identification segment. It identifies a specific line item or product being shipped, including details like the item number and item type.

UIT: Unit Detail segment. It provides information about the unit of measure for the item being shipped.

REF: Reference Identification segment. It includes additional references related to the shipment.

PER: Administrative Communications Contact segment. It specifies the contact person or department responsible for communication-related to the transaction, including their name, email, and phone number.

FST: Forecast Schedule segment. It contains forecast information related to the shipment.

DTM: Date/Time Reference segment. It provides date and time information associated with the shipment, such as order dates, delivery dates, and ship dates.

SHP: Shipped/Received Information segment. It includes details about the shipment, such as the number of units shipped, the packaging code, and the shipment date.

TD3: Carrier Details (Equipment) segment. It provides information about the transportation equipment used for the shipment, including any special handling requirements.

TD5: Carrier Details (Routing Sequence/Transit Time) segment. It specifies details about the carrier, such as the carrier code, routing information, and transit time.

SE: Transaction Set Trailer segment. It marks the end of the transaction set (Shipping Schedule in this case) and includes a control number and the number of segments in the set.

GE: Functional Group Trailer segment. It marks the end of the functional group and includes a control number and the number of transaction sets within the group.

IEA: Interchange Control Trailer segment. It marks the end of the interchange and includes a control number and the number of functional groups within the interchange.

Each segment is composed of elements separated by asterisks (*). The elements

What is the Difference Between EDI 830 and EDI 862? (EDI 862 vs EDI 830)

The EDI 830 and EDI 862 are both important EDI documents used in supply chain management, but they serve different purposes and convey different types of information. Here’s a breakdown of the differences between the two:

EDI 830 – Planning Schedule with Release Capability

The EDI 830, also known as the Planning Schedule with Release Capability, is used by the customer (buyer) to communicate their long-term production to the supplier. It provides a forecast of the customer’s anticipated demand for goods over a specific period, typically weeks or months in advance. The EDI 830 includes information such as item quantities, delivery schedules, and any changes or updates to the forecasted demand.

The main purpose of the EDI 830 is to help suppliers plan their production schedules, capacity requirements, and raw material procurement based on the anticipated demand from the customer. It allows suppliers to align their resources and inventory levels to meet the customer’s needs efficiently.

EDI 862 – Shipping Schedule Transactions

On the other hand, the EDI 862, also known as the Shipping Schedule, is used to communicate detailed shipping information to the supplier. It provides specific instructions regarding the shipment of goods. Thus, the purpose of the EDI 862 Shipping Schedule is to convey specific shipping instructions (delivery date, carrier info, destination facility…). It’s important to note that the 862 does not replace the 830; rather, it complements it.

The primary purpose of EDI 862 is to inform the supplier about the planned shipping activities and enable the customer to efficiently plan their inventory and logistics operations. It helps the customer prepare for the receipt of goods, allocate warehouse space, and coordinate their internal processes accordingly.

In summary, the key differences between the EDI 830 and EDI 862 are:

Content: The EDI 830 focuses on providing forecasted demand and long-term production requirements, while the EDI 862 provides detailed shipping information and instructions.

It is important to note that the specific roles and responsibilities for sending and receiving EDI 862 can vary depending on the business relationship and agreement between trading partners. It is ultimately determined by the specific arrangement and practices between the buyer and supplier.

Planning vs. Execution: The EDI 830 is more related to production planning and demand forecasting, whereas the EDI 862 is more focused on the execution and coordination of shipments and deliveries.

Both documents play crucial roles in supply chain management, helping trading partners effectively plan, communicate, and coordinate their production and logistics activities.

EDI 862 Shipping Schedule Benefits

The EDI 862 Shipping Schedule offers several benefits to trading partners in the supply chain:

Improved Efficiency

By automating the exchange of shipping information, the EDI 862 reduces manual data entry and paperwork, resulting in faster and more accurate processing of shipping schedules.

Enhanced Visibility

The shipping schedule provides real-time visibility into upcoming deliveries, enabling better planning and coordination of resources.

Reduced Errors

With standardized data formats and automated validation, the EDI 862 helps eliminate errors and discrepancies that can occur during manual data entry or paper-based processes.

Streamlined Logistics

The timely and accurate transmission of shipping information allows suppliers and customers to optimize their logistics operations, reducing lead times and improving order fulfillment.

Inventory Optimization

By having access to precise shipping schedules, organizations can manage their inventory levels more effectively, minimizing stockouts and excess inventory.

Stronger Trading Partner Relationships

EDI 862 promotes collaboration and trust between trading partners by enabling seamless information exchange, leading to improved business relationships.

Overall, the EDI 862 Shipping Schedule plays a vital role in supply chain management by facilitating efficient communication of shipping requirements, reducing errors, and enhancing operational effectiveness for businesses involved in the movement of goods.

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June 7, 2023/0 Comments

All You Need to Know About Value-Added Network (VAN)

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What is a Value-Added Network (VAN)?

A Value-Added Network (VAN) is a third-party service provider that enables companies to exchange business-to-business (B2B) electronic transactions (EDI), such as purchase orders and invoices, with their trading partners.

In simple terms, a VAN acts as a middleman between businesses and ensures that the data exchanged between the parties, is transmitted securely and accurately.

In addition to basic transmission services, VANs may also offer value-added services, such as translation between different data formats, data mapping, and data validation. Moreover, VANs often provide security features, such as encryption and digital signatures, to ensure the confidentiality and integrity of the data being transmitted.

VANs are particularly useful for businesses that have numerous trading partners and need to exchange a large volume of electronic documents. By using a VAN, businesses can reduce the complexity of managing multiple connections to their trading partners, as well as reduce the costs associated with setting up and maintaining their own EDI infrastructure.

Dive into the world of EDI (Electronic Data Interchange) with our insightful video explanation.

Explore the video now

The History of VAN

VANs have been around since the early 1970s, when they were first used to connect large corporations with their suppliers and customers. These early VANs were typically owned and operated by telecommunication companies, such as AT&T and MCI.

Over time, the industry evolved to include third-party VAN providers, which offered a wider range of value-added services to businesses. Today, VANs are an essential part of the global supply chain, facilitating the exchange of electronic documents between companies in different industries and countries.

How VANs Work

VANs allow companies to exchange EDI documents and other data electronically.

Here’s a simplified step-by-step breakdown of how a business partner exchanges EDI via a VAN:

Let’s look at a simple example: Two business partners – partner A and partner B – want to exchange EDI messages via a value-added network (VAN).

– Partner A needs to purchase something from Partner B, so he will send a Purchase Order (PO) to Partner B and Partner B will send back an Invoice.

– Partner A has an ISA Qualifier/ID: 12/123456789 and owns a mailbox at VAN Provider “X”, which is their chosen VAN. Within their mailbox, there can be two sub-folders: “in” and “out”.

– Partner B has an ISA Qualifier/ID of 12/987654321 and they own a mailbox at VAN Provider “Y”. Within their mailbox, there are also two sub-folders: “in” and “out”.

– When partner A needs to place an order, he creates an electronic document in X12 format (such as purchase order P/O – EDI 850) that needs to be sent to Partner B.

– Partner A connects to the VAN using a secure login, and uploads the EDI X12 document into their own mailbox at VAN Provider “X”, in the “out” sub-folder. The PO message will contain the ISA segment, which looks like the following:

ISA*00* *00* *12*123456789 *12*987654321 *170526*1121*|*00403*100000000*0*P*>~

– The VAN “X” processes the document, checking it for errors and ensuring that it meets the agreed-upon data formatting standards.

– The VAN reads the EDI message envelop (ISA segment above), and finds to whom it is destined to (in this example to *12*987654321). They have a conversion table where they will lookup this address, to find out it is at VAN “Y”. They will connect to VAN “Y” either via a direct connection or through a partner VAN network, then connect to Partner B’s mailbox at the address specified and drop the message in the “in” sub-folder.

– Partner B can then connect to their own mailbox, navigate to the “in” sub-folder, and pick up the P/O to process it.

The same process works in the opposite direction for an incoming message. In this scenario, the envelop looks like:

ISA*00* *00* 12*987654321 **12*123456789 *170526*1121*|*00403*100000000*0*P*>~

It’s important to note that regardless of how many clients each business Partner has or whether they use different VANs, each partner only needs to connect to their own mailbox to pick up or deliver any EDI message.

The VAN will handle the delivery to the destination mailbox. Interconnectivity between VANs is standard practice, so partners generally do not need to have mailboxes on multiple VANs. Partners should inquire with their VAN to determine if there are any VANs they cannot connect to, but this is a rare occurrence.

The VAN that a partner joins will connect to other VANs where their suppliers are located to deliver/pick up messages.

Throughout this process, the VAN may provide additional services such as message tracking, error handling, and notification of message delivery. These additional services help to ensure that messages are transmitted securely and accurately, and that any issues are resolved quickly.

What Are the Types of Value-Added Networks (VANs)?

Value-Added Networks (VANs) come in different types, with the most common being one-to-one, many-to-many, and one-to-many. Businesses choose the type of VAN that integrates best with their trading partners, data requirements, transaction volumes, and industry.

A one-to-one VAN (Value-Added Network)

A one-to-one VAN (Value-Added Network) is a type of electronic data interchange (EDI) network where two trading partners or businesses use a single VAN to exchange EDI messages and documents directly with each other.

In a one-to-one VAN, the VAN acts as a facilitator, providing a secure and reliable platform for businesses to transmit their EDI transactions without the need for establishing and maintaining multiple individual connections. This simplifies the EDI process, reducing the complexity and cost associated with managing multiple connections and data transfer protocols.

One-to-one VANs are often used by companies with high transaction volumes and a need for frequent and rapid exchange of information, such as those in the retail, healthcare, and manufacturing industries. By using a one-to-one VAN, these companies can streamline their supply chain operations, improve efficiency, and reduce errors and delays in the order fulfillment process

Many-to-Many VAN (Value-Added Network)

A many-to-many VAN (Value-Added Network) is a type of electronic data interchange (EDI) network where multiple trading partners or businesses can exchange EDI messages and documents with each other through a shared VAN.

In a many-to-many VAN, the VAN acts as a central hub or intermediary, allowing businesses to connect with each other and exchange EDI transactions in a secure and standardized way.

Many-to-many VANs are particularly useful for businesses with complex supply chains involving multiple trading partners, as they allow for seamless integration and communication between different systems and platforms. They are also widely used in industries such as healthcare, retail, and finance, where data privacy and security are critical considerations.

Overall, many-to-many VANs provide a scalable and flexible solution for businesses to manage their EDI transactions, enabling them to streamline their supply chain operations, reduce costs, and improve their overall efficiency and competitiveness.

One-to-Many VAN

A one-to-many VAN (Value-Added Network) is a type of electronic data interchange (EDI) network where a single business or trading partner uses a VAN to communicate with multiple other trading partners.

One-to-many VANs are particularly useful for businesses that need to communicate with multiple suppliers or customers, as they provide a standardized and secure platform for exchanging data and messages. They are also widely used in industries such as retail, manufacturing, and healthcare, where frequent and rapid communication with trading partners is critical to the supply chain.

One-to-many VANs provide a cost-effective and efficient solution for businesses to manage their EDI transactions, enabling them to streamline their supply chain operations, reduce errors and delays, and improve their overall competitiveness.

Which Companies Use the Value Added Network (VAN)?

Many companies across different industries still use Value Added Networks (VANs) to exchange business-to-business (B2B) electronic transactions (EDI X12/EDIFACT) with their trading partners. Here are some examples of companies that use VANs:

General Motors: The automobile manufacturer uses a VAN to exchange electronic transactions with its suppliers.

Kaiser Permanente: The healthcare provider uses a VAN to exchange electronic healthcare transactions with its partners.

Procter & Gamble: The consumer goods company uses a VAN to exchange electronic transactions with its suppliers.

FedEx: The logistics company uses a VAN to exchange electronic transactions with its partners.

These are just a few examples, but many other companies in various industries use VANs to exchange EDI with their trading partners.

Choosing a VAN Provider

When choosing a VAN provider, businesses should consider a variety of factors, including the provider’s experience, pricing, reliability, and range of value-added services. It’s also important to choose a provider that offers a high level of security for data exchange, including encryption and digital signatures. Businesses should also consider the provider’s ability to integrate with their existing systems and processes, as well as their customer support and training resources.

How EDI2XML Can Help

Understanding the importance of a Value Added Network (VAN) is crucial for businesses looking to streamline their EDI processes. Choosing the right VAN provider is essential to ensure that your EDI transactions are secure, reliable, and efficient.

As a trusted EDI supplier for over 20 years, we have the expertise and experience to help you navigate any EDI issues you may face. We are committed to providing the highest level of service to our clients and offer a free 1st consultation to help you get started.

May 1, 2023/0 Comments

How Do Companies Send EDI Files?

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Introduction: What is EDI?

The Electronic Data Interchange (EDI) standard was developed by the American National Standards Institute (ANSI). It allows companies to exchange information about products, services, orders, and payments electronically in a standardized format.

Therefore, EDI is a technology that replaces the exchange of paper/file information between business partners with an automated exchange between their computer systems.

EDI is used by many different types of organizations, including banks, insurance companies, healthcare providers, manufacturers, and retailers.

Benefits of EDI for B2B Communication

EDI (Electronic Data Interchange) implementation is a great way for automating business-to-business (B2B) processes. EDI allows companies to exchange business documents such as purchase orders, invoices, etc. in a standardized electronic format, eliminating the need for manual data entry and reducing the risk of errors.

By automating these processes, EDI can help companies to improve efficiency, reduce costs, and increase accuracy in their B2B operations. Furthermore, implementing EDI can help companies to streamline their supply chain, and improve communication with business partners.

Here are some key advantages:

Efficiency and Speed:

Faster Transactions: EDI enables the exchange of business documents in a standardized electronic format, reducing the time required for processing orders, invoices, and other documents.

Real-Time Processing: EDI facilitates real-time data exchange, minimizing delays associated with traditional paper-based methods.

Accuracy and Error Reduction:

Automated Data Entry: With EDI, data is entered automatically into the recipient’s system, reducing the likelihood of manual errors associated with manual data entry.

Data Validation: The EDI 997 (or EDI Functional Acknowledgement), ensures that data is accurate and ensuring the integrity and reliability of EDI transactions.

Cost Savings:

Reduced Paper and Printing Costs: By eliminating the need for paper documents, printing, and manual handling, EDI helps businesses save on material and operational costs.

Lower Administrative Costs: Automation of document processing reduces the need for manual intervention, leading to cost savings in terms of labor and resources.

Enhanced Visibility and Tracking:

Transaction Visibility: Businesses can track the status of transactions in real-time, providing better visibility into the supply chain and allowing for proactive management of processes.

Audit Trails: EDI systems often maintain detailed audit trails, which can be valuable for compliance purposes and resolving disputes.

Improved Customer Relationships:

Faster Response Times: Quicker order processing and communication lead to faster response times, enhancing overall customer satisfaction.

Reduced Errors: Fewer errors in order fulfillment and invoicing contribute to positive customer experiences.

Compliance with Industry Standards:

Regulatory Compliance: EDI often adheres to industry-specific standards and regulations, ensuring that businesses comply with relevant requirements in their sector.

Environmental Impact:

Reduced Environmental Footprint: The move from paper-based to electronic transactions contributes to environmental sustainability by reducing paper usage and waste.

In summary, EDI in B2B communication offers a range of benefits, including increased efficiency, accuracy, cost savings, security, and improved relationships with trading partners. It has become an integral part of modern supply chain management and business operations.

B2B Automation Via EDI Implementation

If your company decides to implement EDI in order to exchange EDI files with your business partners, there are several important parameters to help in this decision:

1. What EDI Standard Will You Use?

The EDI standard prescribes mandatory and optional information that must be contained in each document, as well as established rules for the structure of the document.

In most cases, an EDI standard is selected based on the location of the company or its industry. It is more common in North America to use the X12 standard. European Union companies mostly use EDIFACT. HL7 is a standard used for processing medical data. RosettaNet is used in the electronics and semiconductor industry.

These articles can help you learn more about standards:

2. What Kind of EDI Documents Will You Exchange with Your Business Partner?

Typically, large companies dictate which EDI documents they require. Thus, if your business partner requires the exchange of documents in electronic format, most likely he already has a specific list of documents. An EDI document typically contains the same information as a paper document.

The following are some of the main documents that are exchanged electronically:

However, EDI is not limited to business data related to trade but covers all areas such as medicine (for example, laboratory test results), transportation (container information), insurance, etc.

Take a look at the full list of EDI documents that you can exchange with your business partners. List of EDI documents in X12 standard and EDIFACT.

3.Which Communication Protocol Will You Use?

Unlike an EDI standard or a list of EDI documents that your trading partner may require you to comply with, you will most likely be able to choose which EDI communication protocol you will use.

One of the most critical aspects of exchanging EDI documents is the way information is transferred. Thus, you need to decide how you will send and receive EDI files.

There are several different methods for sending EDI files. Here we will take a closer look at the most frequently used EDI protocols: FTP and SFTP, AS2 and VAN.

What is EDI Communication Protocol?

EDI communication protocols are the methods and technologies used to send and receive electronic data interchange messages. They are used to transfer data between businesses.

EDI Direct Connection (Point-to-Point Connection)

Direct connection allows you to transfer your EDI data directly from your computer to the computer of your business partner. A direct EDI connection can be made via VPN (Virtual Private Network), FTP (File Transfer Protocol), SFTP (Secure File Transfer Protocol), and AS2, which encrypts data before it is sent over the Internet.

FTP and SFTP to Exchange EDI files

FTP/SFTP – File Transfer Protocol/Secure File Transfer Protocol. In order to exchange EDI documents, businesses use these file transfer protocols to connect with their partners over the Internet.

There are a lot of benefits to using SFTP for transferring encrypted files since it is an easy-to-use protocol. Encryption calculations and public/private keys protect data transferred between the SFTP server and the client. The combination of these two elements provides robust protection known as public-key authentication. It is also possible for users to authenticate transmissions using an SSH key or a password.

AS2 (Applicability Statement 2) for EDI Communication

By encrypting EDI data and using digital certificates, AS2 provides a secure method of exchanging documents over the Internet.

The AS2 protocol has become widely adopted and implemented because of the internet’s popularity and HTTP’s leveraging.

AS2 uses a secure HTTPS connection and encrypts messages. The AS2 protocol allows enterprises to exchange EDI data in real-time and directly between their systems.

Walmart was one of the first companies to adopt AS2 for EDI communications. All of its suppliers were required to use the same protocol.

VAN (Value Added Network)

VANs (value-added networks) are private, hosted services that are designed to provide companies with a secure way to exchange EDI information with their business partners.

VAN can be compared to a “post office” where business partners can collect and sort incoming EDI documents.

It is estimated that only a small number of businesses currently use VANs. It is because of the low cost of the Internet and the level of security that can be achieved using Internet communication protocols. Point-to-point communications have become the norm for most of the “big players” in retail.

Conclusion: How Do Companies Send EDI Files?

Does your partner require an EDI document exchange?

If you do not know where to start, don’t hesitate to get in touch with us. Our EDI experts will be happy to help you make the right decision and answer all your questions.

December 5, 2022

Business Automation: How to Choose the Right EDI Solution

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Business Automation through EDI Solution

Most entrepreneurs who have never experienced EDI before, feel overwhelmed when it comes to selecting an EDI provider or solution, to start exchanging business documents with their trading partner.

There are multiple EDI solutions from different big and small EDI Providers. At first blush, each EDI solution looks better than the other, but how do you choose the best EDI solution for your business?

The Electronic Data Interchange (EDI) is the exchange of business documents electronically between business partners.

In this article, I will review the main EDI solutions on the market, using the solutions from EDI2XML as an example, additionally, I will give you useful tips on how to choose an EDI provider without losing sight of key points that will affect the long-term success of EDI.

Why You Should Be Careful When Choosing an EDI Solution?

For many organizations, EDI is a mission-critical application whose failure can lead to a complete stoppage of activity, therefore, the choice of an EDI solution, as well as EDI provider, must be approached carefully.

EDI is responsible for supporting a wide variety of business processes – inventory management, orders, purchasing, logistics, tenders, etc.

Perhaps there is no such field of activity where you can run, without the exchange of documents at all, which means that EDI solutions can be needed everywhere.

Choosing the Right EDI Solution to Automate Your Business

EDI is used for B2B communication in all industries by both large corporations and the smallest companies. That is why there are different EDI solutions designed for different markets and companies.

EDI allows businesses to exchange documents quickly since it eliminates the need to prepare and process mail or to make phone calls, faxes, or paperwork when ordering or selling.

By choosing the right EDI solution, you will make it easier to communicate with your business partners and bring value to your business.

For example, if you are a small company that has only one trading partner that requires EDI exchange, you need a simple EDI solution that does not require a large initial investment, which will allow you to quickly start exchanging EDI documents with your business partner.

Continuing on the topic of EDI solutions, let’s take a look at the different options of EDI solutions on the market, using the example of EDI2XML as EDI service provider.

It should be remembered that the details of EDI solutions from different EDI providers always differ. However, the description below will give you a general idea of the existing EDI solutions.

Fully Managed EDI Services

EDI fully managed service refers to a service where the EDI provider takes full responsibility for managing EDI operations and integrating them on behalf of the client.

With Fully Managed EDI Service, there is no need for the customers to install any software or hardware on their computers. The EDI provider will take care of the implementation and configuration of the process flows. He will be in charge of handling the data routing and will be responsible for the data format conversion and integration.

Through the fully managed EDI service, an EDI provider will take on a wide range of responsibilities that are usually handled by an internal IT department. With a fully managed EDI solution, EDI2XML delivers a turnkey project to connect your business partners.

Which Companies Can Benefit From a Fully Managed EDI Service?

Companies that need to use EDI but don’t want to spend the time and effort on the EDI implementation themselves, or who don’t have the necessary EDI skills and specialists who can do it, need an EDI service provider to handle all the configuration and integration of EDI. In this case, a fully managed EDI service is the ideal solution.

Find out more about Fully Managed EDI Services its process flow, features, technical details and pricing.

EDI Web Service

The EDI Web Service is an HTTP service from EDI2XML that works over the internet on the private platform. This HTTP EDI Web Service (REST API) can receive HTTP requests to convert EDI messages to XML and XML messages to EDI (based on EDI2XML’s proprietary format).

There are many reasons why EDI2XML Web Service is the right choice:

1. Solution based on self-service

2. An affordable price

3. Our free trial period lasts for 15 days without any obligation, so you have nothing to lose.

4. Getting started will take you less than an hour

5. There is no contract with us, and no commitment.

6. We charge on a month-to-month basis; you can cancel at any time with 30 days’ notice.

7. There is a very simple and dynamic pricing scheme that is easy to understand and use

8. The availability and reliability of the service

9. Using proven technologies that are backed by a wealth of experience

10. Support from a highly skilled technical team is outstanding

It is very simple and quick to get started with the EDI2XML Web Service. Within less than an hour, you can make the first Call to the Web Service and see the response.

We offer a well-documented HTTP EDI Web service, and each subscription includes instructions.

Who is the EDI Web Service For?

The EDI web service is intended for developers and enterprises who want to create their own EDI (Electronic Data Interchange) integrations.

Typically, these users can interact with external APIs and web services to convert EDI to XML and XML to EDI. Additionally, they have the expertise and resources to work with web services and HTTP requests.

EDI2XML Web Service is a reliable service for IT professionals who need to perform such integration projects.

We suggest EDI Web Service to companies that have their own technical resources to work with REST APIs (calls and consumptions of HTTP Rest Web services).

Request EDI2XML Web Service Price List

On-Premises EDI Solution

On-premises EDI refers to the implementation of EDI software that is installed and operated through the customer’s own server and computing infrastructure.

On-premises EDI deployment from EDI2XML involves two components that will be deployed on-premises:

1. EDI2XML translation and transformation engine to convert X12/EDIFACT messages to XML and vice versa.

2. A license of Magic xpi a third-party integration and automation platform.

Features of the EDI2XML service “on premises”

1. The application is deployed on the customer’s server

2. Service that is based on a subscription

3. There is a standard XML format for incoming EDI messages

4. Standard XML format for Outgoing X12

5. XML schemas (.xsd) are also provided

6. SMTP/FTP/sFTP protocols are included in the package

When On-Premises EDI is is Right for You?

On-premises EDI is suitable for companies that have strict IT management rules and procedures that they can only deploy software solutions on their own premises.

You should also consider how much EDI data you want to exchange with your business partner. If you expect a very large volume of data, you might consider an on-premises EDI solution. A company’s IT architecture and its team play a vital role in implementing EDI on-premises. Make sure the company has the proper hardware infrastructure, and that the IT department is ready to tackle this project.

Request EDI On-Premises Pricing Plans

Choosing an EDI Provider: What to Look For

Now that we’ve discussed the main types of EDI solutions, let’s talk about what to look for in an EDI provider. There are several different kinds of EDI service providers available.

In developed markets, as a rule, a large service provider gets almost everything – the vast majority of customers start using its product because they do not bother with in-depth analysis of technologies and services, but use the same thing that other companies or business partners utilize.

It is for this reason that demonstrations of a large number of customers are one of the most popular marketing techniques. Of course, a large customer base may indicate the reliability of the EDI provider (which does not always correlate with the quality of the EDI solution, price flexibility, service, and technical support) that you can get from smaller EDI providers.

The following are some basic recommendations about what you should look for when choosing an EDI provider for your company.

– Exclude sales and market share statistics from your list of EDI provider criteria.

– Rely on relatively new projects that are comparable in scope to your organization as references.

– It is critical to pay attention to how quickly the company responds to your requests when you contact them.

– A provider of EDI services should be able to connect you with technical experts for a personalized consultation.

– If you need a customized quote, how quickly will they be able to provide it to you?

– How does an EDI provider support its customers? When it comes to technical issues, how quickly can they resolve them?

– Check if the prices of the company can be adjusted based on your needs.

Remember that a big EDI provider doesn’t always mean the best.

Conclusion: How to Choose the Right EDI Solution

The use of EDI has become a necessity for most companies today. Meanwhile, the choice of an EDI solution has become very difficult for companies. This is because the market for EDI solutions is currently quite large, in addition, EDI solutions in terms of technical characteristics and functionality have become quite similar to each other.

Therefore, factors such as the reliability, experience, and flexibility of the EDI provider often become the last argument when choosing an EDI solution.

If you are not completely satisfied with your EDI provider, then read this helpful article How to Change Your EDI Service Provider

Are you looking for ways to improve your business processes? Then look no further! Our EDI services are here to help! Our EDI experts are available to give you a free consultation if you are still unsure which EDI solution is right for you.

July 12, 2022/0 Comments

EDI Integration for B2B Exchange to Optimize and Grow your Business

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What is B2B EDI?

B2B (Business-to-Business) Integration, also known as Electronic Data Interchange EDI, is the process of exchanging business documents electronically either internally or amongst external business partners.

Electronic data interchange (EDI) has become a standard data exchange practice in modern business. EDI allows companies to automate their business processes leading to greater efficiency. Automated data exchange allows to avoid errors, reduce order processing time, and achieve accuracy.

What is meant by EDI?

EDI (Electronic Data Interchange) is the process of exchanging documents electronically through secure communication channels from one software information system to another. In other words, from one business partner to another.

In a fully automated process, the exchange of electronic documents (for example, receiving and processing orders), can take place at the application level, without the direct involvement and participation of employees.

Who typically uses EDI?

EDI standard and connected technologies are used in a B2B data exchange protocol, of any type of businesses in different industries. These can be large, medium, or small enterprises operating in retail, manufacturing, healthcare, pharmaceutical, or any other industry. EDI is also used in international trade such as air, sea, and road transportation. Not surprising, to see customs in most of the countries using EDI heavily in their cross-border operations.

Experience shows that large retailers such as Walmart, Costco, Kroger, Home Depot, Target, etc. are always the initiators of electronic data exchange. Moreover, almost all retailers, having evaluated the advantages of using EDI, force their suppliers to exchange documents only through EDI.

EDI Integration with Business Systems (ERP/CRM)

EDI integration allows to automate the creation, sending, receiving, and processing of any business documents in electronic format with a trading partner, existing backend business systems, or applications, to provide a greater level of efficiency and complete automation.

With over 21 years of experience in EDI and the integration marketplace, our company EDI2XML has a proven experience in integrating EDI, with the most frequently used systems:

EDI Integrations and eCommerce Businesses

EDI is also becoming a vital element of the e-commerce business; we are receiving more and more requests for e-commerce integration with EDI.

Especially, requests for connecting online stores running on one of the major e-commerce platforms. The most frequent EDI e-commerce integration are:

Shopify EDI Integration
Magento EDI Integration
BigCommerce EDI Integration
Amazon Vendor Central EDI integration
Amazon Seller Central EDI integration
Walmart EDI Integration
And much more…

This means that orders from an online store will be automatically converted into an EDI document (for example X12 EDI 850 Purchase Order) and pushed into a supplier’s business system. This is the most common scenario in an eCommerce dropship business.

However, it is worth mentioning the very common request for e-commerce integration with ERP / CRM systems. This means syncing data between business software systems (SAP, Salesforce, JDE, etc.) with your e-commerce store.

Fully Managed EDI Services to automate data exchange with business partners

Our company offers a fully managed EDI service that includes transformation and connectivity services for companies of all sizes.

Our customers do not need to install any software or hardware because all EDI file conversions and transformations, are done from our side. We carry out all stages of an integration project from project planning to testing with the trading partner.

Our integration platform receives EDI files (for example x12 or EDIFACT) from the trading partner, then converts them into the required format (i.e. XML, CSV, TXT) and sends them to you (see the picture below).

EDI2XML platform will sit in the middle between you and your trading partner to convert, send and collect all EDI documents.

Request Fully Managed EDI Service Pricing Plans HERE for more information.

Benefits of using EDI for B2B exchange

Currently, using the latest technologies, EDI implementation is not so expensive (as many business leaders might think), but the benefits of EDI integration allow companies to significantly speed up document flow and increase sales. Besides, EDI has many advantages, namely:

EDI enables companies to optimize all processes in the enterprise, from planning to production management and control.
EDI allows increasing the speed and efficiency of data processing. Mandatory use of standards (for example X12 or EDIFACT) helps to avoid errors and improve accuracy.
EDI helps manufacturers to quickly respond to the requests of their wholesalers’ customers.
EDI document exchange allows retailers and wholesalers to improve the efficiency of logistics and procurement as well as improve inventory management. For example, using EDIFACT messages such as INVRPT, DELFOR, DELJIT, and DESADV allows reducing warehouse storage costs.
EDI integration allows companies to reduce the number of employees who enter data into the business system received on paper or by e-mail.
EDI increases the accuracy of information processing because as practice shows, errors are inevitable with manual data entry.

B2B / EDI Integration – find the best Solution

EDI2XML offers various EDI integration solutions.

Whether you are a buyer, supplier, manufacturer, retailer, 3PL Warehouses, or Logistics – using our advanced EDI technology, you can exchange data electronically with all your partners quickly, reliably, and efficiently.

We’ve got an EDI solution that really makes your day-to-day tasks easier and faster!

June 22, 2021

The Top 6 EDI Documents for Retail Suppliers

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In this post, I’ll give a brief overview of the top 6 EDI transactions used in the Retail industry, the main differences between documents exchange via EDI and email, and how you can quickly satisfy the request of a large retailer (such as Walmart, Target, Costco) about EDI compatibility and start exchanging EDI documents fairly quickly.

What is Electronic Data Interchange (EDI)?

EDI is a protocol to exchange business information between two organizations electronically based on a predefined standard. EDI has replaced the use of paper documents or the exchange of business information by email.

EDI in the Retail Industry

Electronic Data Interchange (EDI) has been widely adopted in the retail industry to facilitate efficient and accurate communication between trading partners. EDI is the electronic exchange of business documents between two or more organizations in a standardized format.

The retail industry has been using EDI for over 30 years. Can you imagine the volume of business documents flow at large retailers? They have thousands of transactions every month with hundreds of suppliers and tens of thousands of products.

For such large trading companies, it is simply impossible to do business without exchanging EDI. That is why they force their suppliers to exchange documents through EDI.

What is a Retail Supplier?

Supplier is any legal entity (organization, enterprise) or individual that provides goods to another entity. Retail suppliers are business-to-business (or B2B); they sell products to other companies, and not directly to the consumer.

Suppliers can be manufacturers, as well as various resellers (including wholesalers).

The supplier carries out business activities by the terms of the concluded supply agreement.

Giant retailers such as Best Buy, Wal-Mart, Costco, and Target have supply agreements with many different suppliers from whom they buy goods in bulk and then sell them to the final consumer in their stores or online stores.

What is the Difference Between EDI and Email?

Let us make a comparison between sending a purchase order from a Retailer to a supplier by email and another one by EDI. Here are some major differences:

1. Transfer or exchange of business information

Both methods have secure communication channels, however, EDI communication channels use higher security standards.

2. Standards and structure

The content of the email is not structured at all. There is no standardization when placing a purchase order via email. Thus, the supplier needs to check many elements such as subject, message body, attachments, because the information about the purchase order can be either in the body or in one or multiple attachments.

The content of an EDI Purchase Order (EDI 850) is very well structured, and it conforms to a specific standard (i.e. X12, EDIFACT, …). Each element and loop have a pre-defined purpose.

3. The ability to integrate with business systems (ERP/CRM)

Extracting the data “automatically” from an order coming by email is very difficult (not to say extremely difficult), while extracting the purchase order information from an EDI X12 850 for example, or a UN/EDIFACT ORDER is much more standard.

As a conclusion: exchanging business documents complying with EDI standards, enables companies and business partners in the retail to automatically integrate data into their internal business systems, efficiently and with great accuracy without human intervention.

Commonly used EDI Documents in Retail

Large retailers using EDI can standardize the process with their trading partners, thereby improving all business processes, increasing profits and customer satisfaction. For all size suppliers, the use of EDI gives access to large retailers and therefore a stable volume of orders. Let us look at the main EDI transactions used in B2B trading between retailers and suppliers.

1 – EDI 846 – Inventory Inquiry/ Advice | EDIFACT INVRPT

EDI 846 (EDIFACT/INVRPT – Inventory Report) is a notification that the supplier usually sends to the retailer, which contains information about the availability of goods. This EDI transaction is used to inform your trading partners (retailers) about stock levels but does not oblige them to make a purchase. Usually, EDI 846 also includes pricing information.

For more information about EDI 846 read our article: What is EDI 846 document?

2 – EDI 850 – Purchase Order | EDIFACT ORDERS

EDI 850 (EDIFACT/ORDERS) is an electronic document that is used to place an order for goods.

EDI 850 is usually sent by retailers to their supplier of goods. This document indicates the quantity of the required goods as well as all the details regarding the order (Item description, price, and quantities, shipping details, requested delivery date, and location(s) of delivery).

If you want to know more about EDI 850 read the article: All you need to know about EDI ANSI X12 Transaction Set 850 Purchase Order

3 – EDI 855 – Purchase Order Acknowledgement | EDIFACT ORDRSP

The EDI 855 (EDIFACT/ORDRSP – purchase Order Response) is a reply to the message (EDI 850). It is sent by the supplier after receiving the order from the retailer.

By returning the 855 messages, a supplier agrees to fulfill the order or proposes to amend. In other words, using EDI 855, the supplier either notifies the full, partial, or refusal to fulfill the order. This message helps the retailer avoid supply disruptions.

You will find detailed information about EDI 855 in this article: What is EDI 855 Purchase Order Acknowledgment?

4 – EDI 856 – Advance Shipment Notice | EDIFACT DESADV

EDI 856 (EDIFACT/DESADV – Despatch Advice) is a notification sent by the supplier immediately after the shipment of the goods leaves its warehouse.

The idea behind this message is that the retailer may know in advance about the fact that the products have been loaded, its quantity, and the expected delivery date. This way, he can efficiently plan the receipt and scanning of the goods at his warehouse.

You will find detailed information about EDI 856 in this article: What is Advanced Ship Notice (ASN) 856 transaction set?

5 – EDI 861 -Receiving Advice/Acceptance Certificate | EDIFACT RECADV

The EDI 861 (EDIFACT RECADV – Receiving Advice) acts as a response message to EDI 856 which confirms the acceptance of the goods.

Acceptance is communicated from the retailer to the supplier. It indicates there is a discrepancy between what was sent by the supplier and what was received by the retailer and details the list of goods received.

Besides, the retailer can provide additional information such as information about damaged items during transportation, etc.

Complete List of EDI Transactions, Sets & Codes for ANSI ASC X12 Standard

6 – EDI 810 – Invoice | EDIFACT INVOIC

EDI 810 (EDIFACT INVOIC – Invoice) is an electronic document provided by the supplier to the retailer to bill for the goods delivered. EDI 810 contains a list and description of goods, their quantity, and price, as well as information about the sender and recipient.

For complete information on EDI 810 read this article: What is an ANSI ASC X12 EDI 810 invoice?

These are some of the most commonly used EDI documents in the retail industry, facilitating efficient communication and transaction processing between trading partners.

EDI flow in the retail industry

Let us look at a typical EDI flow between trading partners (where the retailer acts as a buyer) in which the top 6 EDI transactions described above are involved.

1. The supplier sends or feeds the retailer his inventory status, to inform about the availability of goods – Inventory Inquiry/ Advice (EDI 846).

2. The retailer sends the Purchase Order to the supplier (EDI 850).

3. The supplier checks the availability of the goods in the warehouse and sends the Purchase Order Acknowledgment (EDI 855), in response to the Purchase Order.

4. The supplier immediately after shipment of the goods, generates and sends to the retailer an Advanced Ship Notice (EDI 856).

5. The retailer, after acceptance of the ASN received from the previous step, generates and sends the supplier a Receiving Advice/Acceptance Certificate (EDI 861).

6. The supplier, based on the above acceptance notifications, generates an Invoice (EDI 810).

This EDI flow is considered for the case when the trade agreement between the retailer and the supplier has already been concluded, and the retailer has a list of goods from each supplier in its business system.

Benefits of using EDI

EDI has long been an integral part of B2B especially in the retail vertical. Using EDI to exchange business information provides many business benefits to both large and small businesses. Here is a short list of those benefits:

Speeds up workflows

You can send any document in seconds.

Prompt exchange of documents speeds up the process of ordering and delivery of goods. The main benefit for the retailer is the uninterrupted replenishment of goods. For the supplier, a quick payment for the delivered goods.

Saving resources and time

No need to use operators for manual processing of business documents, duplicate on paper, store, send by mail, or courier.

One standard for everyone

EDI makes it easy to start selling to large retailers. Exchange EDI documents without worrying about format differences and compliance with business systems (ERP /CRM) of your trading partner.

Accelerate the acceptance of goods

When EDI is integrated into the retailer’s business system, data from suppliers goes directly to the accounting system. Thanks to automatic item matching, goods are accepted very quickly. The process of accepting the goods is quick and easy.

Reduces risks

EDI eliminates errors associated with manual data input, as well as the loss of documents.

Secured data transmission

EDI documents are transmitted over secured channels in encrypted form, or through private value added network, no concern about data breach.

About EDI2XML services

EDI2XML offers a wide range of EDI services to automate the exchange of documents between all parties in the retail and transportation industry, whoever they are: retailers, suppliers, shippers, consignees, and transport companies.

We help your company get started on exchanging EDI with your partners in a fairly and relatively short period of time, and on budget. Whether adopting our Fully EDI managed EDI Service or our EDI2XML self-service Web service, we can empower your company with the ability to send and receive any type of electronic documents such as Purchase Order (EDI 850) PO Acknowledgment (EDI 855), Invoices (EDI 810), ASN (EDI 856) and many more.

Useful Reading: Fully managed EDI service VS HTTP Web Service: Which is Better for Your Business ?

March 17, 2021

Electronic Data Interchange: Key Information You Need to Know

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This post was updated to reflect current trends and information.

EDI (or Electronic Data Interchange), has been part of business for long time; However, questions about its functioning, pros and cons are still not clear for new EDI users and those who have been using EDI for years in their business.

To help better understand EDI, we created this e-book “Electronic Data Interchange: Key Information You Need to Know”, where you find answers to most of the frequent questions like What is EDI? Benefits of EDI, EDI communication (EDI-VAN) and (EDI -INT) and much more.

It was built for beginners and those who have strong EDI technical knowledge. We are certain you will get important information out of this eBook, that is certainly useful to your EDI projects.

We invite you to download this e-book from EDI2XML Resource Page

January 1, 2019

All About EDI: 11 Complete Answers about Electronic Data Interchange

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This post was updated to reflect current trends and information.

We often get asked questions about EDI (Electronic Data Interchange), so we decided to write this article to answer the most common questions we get. We also provide you with useful links in case you’d like to explore further.

1. What is EDI? (Electronic Data Interchange)

Electronic Data Interchange (EDI) In simple words, EDI is the process of electronically exchanging business documents (in a pre-defined format) between trading partners. EDI replaces the faxing of paper and mailing documents.

Any standard business documents (e.g. a purchase order, invoice, shipping notice etc.) can be transferred by EDI, considering both parties have been setup to exchange with the appropriate EDI communication.

Useful Reading: EDI Document Library

2. Who uses EDI?

Organizations of all types and sizes are able to utilize EDI. EDI communication is used in Government and various industries such as banking, healthcare, retail, automotive and others. Any company that buys, sells goods or services can potentially use EDI.

3. To be EDI capable or EDI compliant – what does it mean?

In simple words, EDI capable or EDI compliant is the ability to exchange business documents electronically in a specific format based according to an EDI standard.
Being EDI compliant, means your company has complied with the pre-agreed EDI standard which allows you to send and receive EDI documents to any business/trading partner located anywhere in the world.

4. What are the EDI standards?

All EDI transactions are determined according to EDI standards. Many industries have developed their own EDI standards to fit their requirements and business terms. EDI standards are built on the concept of making electronic business documents uniform, without regard to a country or place of origin. EDI standards regulate the correct order and location of the units of data in an EDI document. Below are some of the most commonly-used standards:

ANSI ASC x12 Uniform standard, developed by the American National Standards Institute, and Accredited Standards Committee X12 (ASC X12) to support companies across different industry sectors in North America.

EDIFACT Electronic Data Interchange for Administration, Commerce, and Transport (EDIFACT), developed by the United Nations. EDIFACT is the international standard but is widely used by multiple industries in Europe.

RosettaNet A standard widely used in the global semiconductor industry, but also in electronic components, consumer electronics, telecommunication, and logistics. RosettaNet is widely used in the USA, but it is also well accepted and even supported by governments in Asia.

Useful Reading: RosettaNet and B2B EDI Integration: All you need to know

PEPPOL (Pan-European Public Procurement Online) allows public organizations and their suppliers to exchange standard-based electronic documents over its network. PEPPOL simplify the trading process between private companies and government.

Useful Reading: B2G Integration: PEPPOL EDI Data Interchange

ODETTE A standard used by the automotive industries in Europe, developed by the Organization for Data Exchange by Tele Transmission in Europe.

SWIFT (Society of Worldwide Interbank Financial Telecommunication) The main goal is to exchange messages between financial institutions and banks. Financial and bank institutions from over 200 countries used SWIFT.

Tradacoms Standard mainly used in the UK retail sector.

5. What is EDI Mapping?

Mapping is the process of taking data from EDI format, to a company specific format and vice versa.

6. What does an EDI document, an EDI message or EDI transaction set, mean, is there a difference between them?

In the EDI environment each business document, such as an invoice or a purchase order, is called an EDI message or EDI transaction set or EDI document. Technically, there is no difference between them… The most commonly used EDI documents, especially in the retail and manufacturing industries, are as follows:

810 Invoice
846 Inventory Inquiry message
850 Purchase Order
855 Purchase Order Acknowledgment
856 Ship Notice/manifest (ASN)
997 Functional Acknowledgment

Useful reading: The most used EDI messages in the supply chain management

What is Advanced Ship Notice (ASN) 856 transaction set?

What is EDI 846 document?

Why EDI 846 is important to do business with big-box retailers

7. What are EDI Communication Protocols?

EDI protocols are the communication platform used for constant transmission of data between business partners.

Companies can either exchange documents directly to their Trading Partners (Point-to-Point) or through an EDI Network (VAN).

Direct

Direct EDI also known as Point-to-Point, allows companies to establish a single secure connection with their Trading Partner. Following are the most common communication protocols used to exchange EDI data in a point-to-point or direct connectivity:

FTP/SFTP – File Transfer Protocol/Secure File Transfer Protocol. These file transfer protocols allow businesses to connect with their partners via the Internet in order to exchange EDI documents.
AS2 A secure way to exchange documents over the Internet by using digital certificates and encryption of the EDI data.

VAN (Value Added Network)

VAN – is a private network provider, that only transmits EDI transactions in a secured manner between private networks. A VAN is a mediator who moves data from point A to point B. Until recently, this method of transferring data was considered the safest.

Useful reading: EDI Communication and VANs

8. Which EDI Standard, Document(s) and Protocol should I use?

If you are just starting out, then you will most likely receive a list of requirements from your Trading Partner. It all depends which EDI standard they use, which documents they require from their Partners and how they expect these documents to be sent to them. Your trading partner is one that most of the times dictates the documents to exchange.

9. What are the Benefits of EDI?

There are multitudes advantages to use EDI (Electronic Data Interchange) both for small and mid-size companies as well as to big corporations. Below some impressive benefits from implementing EDI:

Improves Shipment Accuracy
Accelerates the movement of goods to customers
Improves customer/partner relationships
Improves cycle time reductions
Decision makers are able to quickly access order statuses
Improves document accuracy due to the elimination of manual labor.
Enhances the flow of information between 2 trading companies
Internal teams can now focus on core business tasks and

10. What is the difference between SaaS EDI & On-Premise EDI Software?

SaaS EDI

Using SaaS EDI model customers do not pay for ownership of the software, but for renting it (i.e. using it through a mobile application or Web interface). The main advantage of the SaaS model for the company is the absence of costs associated with the installation, update, and maintenance of the equipment and software that is being used by the company.

On-premises EDI

In on-premises deployment model, the company needs to maintain and manage the EDI software system itself. There is a whole control over all aspects of the EDI system including security, access and data integrity. EDI software is loaded onto the company’s owned PC or servers. If you choose the on-premises EDI model, keep in mind that you need the skills and expertise within your IT team. You also need the budget to maintain and upgrade EDI software and hardware when needed.

Useful reading: SaaS EDI or On-Premises EDI Translation Software: What you should know

11. What is EDI2XML?

EDI2XML is a SaaS EDI Solution, capable of converting EDI documents into XML/CSV/TXT format files and vice versa. EDI2XML is a Full Translation Service, which includes the translation of incoming and outgoing documents as well as communication with Trading Partners.

If you are still not finding the answer in our frequently asked questions post, please contact us.

Do you want to implement EDI at your company? Find out how to get started – request a live demo of EDI2XML.

October 22, 2018

The most used EDI messages in the supply chain management

Blog

This post was updated to reflect current trends and information.

In this article, we want to talk about the top EDI messages commonly used by trading partners in supply chain management. We will explain the purpose of the EDI messages and their benefits.

What is EDI?

The acronym of EDI is Electronic Data Interchange. The main objective of EDI is to replace the exchange of paper-based business documents.

EDI is the exchange of structured business documents used in B2B. The implementation of EDI is almost limitless. EDI is present in every commercial activity:
– supply chain management
– e-commerce
– Warehousing
– Insurance
– Banking and finance
Electronic data interchange (EDI) is helping businesses to automate specific business processes, as well as to cover an entire cycle of logistics.

What does EDI mean in logistics?

In short terms, an EDI is a flow where one business partner can create digital and electronic “business documents”, compliant to a specific standard (i.e. X12, EDIFACT, Tradacom, RosettaNet,) and transfer to the second party in a secured telecommunication channel.

Useful: eBook: EDI – Key Information You Need to Know

The most commonly used set of EDI messages

Following is the list of o the most commonly used EDI transaction sets used in today’s business space, from supply chain management to e-commerce, you will find the following documents as the basics for EDI exchange:

– EDI 846 Inventory status

– EDI 850 Purchase Order

– EDI 855 Purchase Order Acknowledgement

– EDI 856 Ship Notice/manifest (ASN)

– EDI 860 P/O Change

– EDI 810 Invoice

The above EDI messages, called “must-have” because they are necessary to automate the most important trading cycle in the supply chain management, eCommerce, and Drop-ship space.

Many companies do not limit themselves only on the above EDI messages, they can decide to leverage other transactions and business documents to improve their supply chain effectiveness; as an example, they can request to add the 753, 754, and other documents related to pickup and delivery…

Useful: EDI Transaction Types – Complete List of EDI Transactions

EDI messages types

EDI 846 Inventory status

Most trading partners in the supply chain and eCommerce space, request that their suppliers update them with their inventory status by sending the EDI 846 document. You can check the details about this document in this article.

EDI 850 Purchase Order

Often, this is the first type of EDI message that companies such as retail chains, manufacturers, warehouses, or 3PL-providers to exchange when they switch to EDI.

EDI 850 contains:

Order number
Required date and time of delivery
Reference to the contract or contract number
Price
Sender and customer information, the place of delivery
Information on the contents of the order (bar codes, quantity, the name of the goods, multiplicity of packaging).

With the EDI 850, the product ordering process goes faster and becomes cheaper as the number of people involved in the process is reduced. Thanks to the fast and guaranteed transfer of information about the order, the supplier improves the reliability of the deliveries.

EDI 855 Purchase Order Acknowledgement

EDI 855 response to the Purchase Order is a “couple” message for EDI 850. The supplier sends EDI 855 to the buyer in accordance with the order value or suggesting to make changes regarding order quantities. This helps to avoid disruption in the supply chain.

Useful reading: What is EDI 855 Purchase Order Acknowledgment?

EDI 856 Ship Notice/manifest or ASN

ASN is a pair of EDI 861 Receiving Advice.

These notifications are exchanged between the business partners at the stage of shipment and receipt of the goods.

The supplier sends ASN immediately after the shipment. This EDI message helps to simplify and speed up the process of acceptance of goods. EDI 856 Ship Notice/manifest contains detail shipment information:

Shipment information (bill of lading number, ship to, ship from, etc.)
Unit load information about a physical shipping item.
Order information such as purchase order number, buying place, division number, etc.
Tare information about the pallets.
Pack information about the shipping package (cartons, racks, bags, etc.,)
Item information about the shipped goods, such as SKU identification, quantity shipped, etc.

Companies that have implemented ASN significantly increase the speed of receiving goods and entering data into the business system – with EDI 856 you do not need to drive numbers manually from the invoices. ASN information can go directly to the business system.

For the big trading retailers, this type of EDI message is a vital necessity. Advance notification of the goods delivery helps to prepare for its acceptance. Even before the supplier’s truck arrives, the retailers already have a list of the goods sent.

EDI 860 Buyer triggered P/O change

EDI 860 is a transaction sent to the supplier advising him about a change in the Purchase order sent earlier. The change can be to increase/decrease/delete quantities on an order or to change dates.