Deciding on the right EDI services

This is especially true for smaller businesses that are completely new to Electronic Data Interchange. Navigating all the different solution types, message requirements, and varying costs between providers can be a significant challenge. So, decision-makers need guidance in order to make the right choice for their business…

Learn all the EDI basics and more

Our ultimate beginner's guide to EDI provides all the information you need to make the right choice for your business, from start to finish.

In this blog, we guide you through how to assess what type of EDI service is right for your business and the key questions to consider when approaching different providers.

You’ll learn:

• What the basic EDI message set is
• Whether you need additional message types
• The difference between EDI setups
• How factors such as a VAN and additional features affect costs

We have highlighted the most frequently asked questions that our team receives from clients when assessing different EDI services. But if you’d like to discuss your unique business needs, then feel free to schedule a meeting.

What EDI messages can I exchange?

The beauty of EDI is that there is such great scope and flexibility when it comes to the exchange of important information across your supply chain network.

The basic EDI message set

The two message types that most businesses start with are orders and invoices. As you’ll likely agree, these are some of the most commonly used documents that sit at the core of an organisation’s operations.

Therefore, digitising the exchange of these vital business documents between trading parties can free up valuable time for teams, as well as increase the accuracy and speed of processing.

Additional message types

Whilst orders and invoices may be the base message set to start with, there are a whole array of other EDI message types that you can utilise.

Depending on the EDI protocol you are following, the messages you can exchange will vary. However, there are many similarities in message categories that run across the different protocols, including (but not limited to):

• Procurement message sets
• Order message sets
• Transport and shipping message sets
• Customs message sets
• Payment message sets
• Reporting message sets
• Master data message sets

For example, you can view the full list of EDIFACT messages and compare the differences with the list of EANCOM messages.

How to know what EDI messages you need to exchange

The EDI message set you require depends on the retail partner you wish to connect with. Your organisation’s internal processes may also indicate the EDI messages and formats that need to be enabled for your systems.

If you are in the process of setting up a trading relationship with a retailer, usually, they will provide you with their set of requirements. This documentation is commonly referred to as a Message Implementation Guide (MIG). A MIG will typically include the EDI message types that they mandate for their suppliers to use, as well as the specific EDI protocol(s) they follow.

We have familiarity with the general EDI requirements for the top retailers and distributors across many industry verticals. You can view our Trading Network to get an idea or talk to our team directly to outline your requirements.

On-premise, web portal, or integrated: what to choose?

Organisations looking at onboarding EDI services have a choice of strategy. Depending on requirements and the organisational structure, there’s a choice between an on-premise EDI solution or an external SaaS (Software as a Service) provider.

The difference between setups

On-premise EDI

An on-premise EDI solution is often referred to as a legacy system. This is because the technology tends to be older, and therefore, less sophisticated.

Legacy systems are entirely managed in-house by the organisation. This includes the initial technical installation, daily running, and any necessary updates (e.g. security and legislative requirements), of the EDI solution.

The main downfalls of on-premise EDI are that it is:

1. Reliant on employing and retaining the technical skills to oversee the solution
2. Dependent on the use of internal servers and storage for the solution to work
3. Out of budget for smaller organisations, due to the large overhead and resourcing costs

Managed EDI services

To avoid all the headaches described above, we recommend that all EDI newcomers onboard with a dedicated SaaS provider.

Taking this approach is preferable as SaaS providers offer a fully-managed service. This takes away all the responsibility from your organisation’s shoulders. Instead, the EDI provider takes on the full onboarding and setup process and the day-to-day technical management of the solution.

Plus, the use of internal servers is no longer a problem. SaaS EDI is far more accessible because it tends to be hosted in the cloud and can be accessed remotely via a web browser or API (Application Programming Interface).

Choice of SaaS EDI

With SaaS EDI, organisations have an additional choice as to their setup; a web-based EDI portal, or the integration of EDI with existing business systems/applications.

Granted, an integrated EDI solution is slicker by automating even more processes within a business, but it is not always the right choice. Don’t get us wrong, we are huge advocates for integrating automation services, but the business need must warrant it.

We would not recommend integrated EDI solutions to clients that would not fully benefit from it. E.g. organisations wanting an EDI connection for just one trading partner and with simple message types would be much more suited to a web-based platform setup.

With a lower cost and quicker onboarding time, businesses with this simpler setup can get up and running with EDI in next to no time. This is particularly important for SMEs starting with their first big retailer contract that mandates EDI. Speed, cost, and ease of use are vital to maintaining Business As Usual (BAU).

Key indicators to help you choose

So how to ensure you’re making the right choice for your business? We have summarised some key indicators to help guide you in the right direction.

Size of the trading network

The number of trading partners you need to connect with through EDI will impact your choice of setup.

An organisation with a large network of trading connections, each with its own message requirements and EDI protocols will benefit from integrated EDI services or middleware EDI to facilitate this scale and complexity.

However, an organisation that only needs simple connections with a handful of trading partners will gain greater ROI (Return On Investment) from a web-based EDI platform.

Type of trading partners

The type of trading partners your organisation has is also a factor to consider when deciding what EDI services to onboard. Whether your trading partner is a retail marketplace, a third-party warehouse, or a dropship manufacturer could indicate the need for a wide variety of standard and bespoke message types, making integration the most optimal solution.

What are the costs?

There can be a lot of smoke and mirrors regarding the cost of business automation and EDI services. This can make comparing providers and solutions confusing for organisations that want to make the most cost-effective choice. Understanding the pricing structures and the determiners of cost is vital before agreeing on a contract.

To support organisations navigating this, we have put together some insight into factors and features that affect the cost of an EDI solution.

Functionality and features

Not all EDI solutions are made equal. Understanding the required features and functionalities for your EDI setup will help determine costs:

• Number of message types
• Bespoke message types
• Number of trading partners
• B2G connections
• Integration with systems/applications
• Reporting and archiving
• Scope of support

Value-Added Network

The vast majority of EDI companies charge their customers to use a Value-Added Network (VAN) to send messages and documents to trading partners. With a VAN, users pay for every transaction, based on the number of characters in a document.

VAN charges can be expensive, they often make it very difficult to forecast how much an EDI solution will cost and companies are often penalised when they grow (and their VAN traffic increases). Companies are also often caught out by the small print, such as minimum record lengths, envelope costs, and more.

This is why when exploring the options available to your business, you must ensure that you understand the costing model and that the pricing of the solution you choose is completely transparent.

Transalis transparently priced solutions

At Transalis, we offer this exact transparency, no smoke and mirrors and no hidden fees. The price you’re quoted is the price you’ll pay. Take a look at our EDI solutions or even use our eDI Freedom calculator to work out which is the best option.

Questions to ask before choosing an EDI company

Beyond weighing up message sets and setup types, it helps to test any shortlisted provider against a few direct questions. Can they show that the solution will suit your business and scale as your trading network grows? Will they adjust the setup as your requirements change, rather than leaving every amendment to you? And can they demonstrate a track record of delivering results for organisations like yours?

At Transalis, we point to two decades of experience across retail, manufacturing, distribution, logistics, health and beauty and FMCG, handling 30m+ transactions and 7bn+ in invoice value a year for clients including Argos, Smeg, Pret a Manger, AG Barr, The Hut Group and Superdrug. Read more: How SMEG automated order data checks for partners without EDI. Read more: How The Hut Group manages EDI for 1,000 suppliers.

Choosing an EDI service that supports international trade

Growth increasingly means trading beyond the UK, and a significant share of businesses expect the number of overseas trading partners they deal with to increase in the years ahead. That makes it worth checking whether a prospective EDI service already supports the protocols international trade depends on.

Transalis is a fully certified AS4 Peppol and EURINV19 provider. Peppol is a protocol designed to let government bodies and private suppliers exchange standardised electronic documents, and EURINV19 sits within the EU's Connecting Europe Facility programme for secure electronic interaction between citizens, businesses and public authorities, giving customers reassurance that their EDI service will keep supporting them as they expand internationally.