Starting or running a small business can make you feel like you have to be all things to all people.

Keeping on top of accounts, tax, marketing, sales, relationships with suppliers and partners – the list goes on. There are so many things to learn about EDI basics, the term EDI being a prime example. If you are part of the supply chain selling into a large buyer, you may already have heard of EDI and been told you need it to exchange orders, invoices and shipping notes. If you’ve never heard of it, don’t worry. Here we run through the EDI basics and explain everything you need to know to get up to speed.

Our EDI software

Learn the EDI basics

1. What is EDI?

EDI stands for ‘Electronic Data Interchange’.

It is the means by which trading partners automatically process and share documentation electronically. Essentially it is software that makes life easier for business owners like you. That’s because you no longer have to raise orders and invoices manually and send documents by email or post that then have to be keyed into management systems. Moving to EDI means you avoid all that and instead take advantage of automation. Increasingly, larger companies and some governments are mandating the use of EDI across supply chains and that could mean you have to adopt it too so you can stay competitive and win business.

2. Brief history of EDI

EDI has been around in various iterations for many decades, supporting global commerce and industry as a fast, accurate way of exchanging data between trading partners.

By eliminating the need for paper documents and automating the whole activity of sharing transaction data, it has introduced across-the-board time and cost savings and improved accuracy. EDI is also doing its bit to help save the planet by helping companies avoid paper-based manual processes that are increasingly seen as unsustainable.

3. Benefits of EDI

EDI minimises error, maximises efficiency, reduces delivery times and speeds invoice payments.

EDI solutions have benefits for so many processes, from inventory management, to shipping, to audit. Unlike traditional paper-based approaches, an EDI process can be measured in minutes rather than days making the whole proposition of data transfer far more efficient and cost-effective.

4. Different types of EDI

Companies can choose to set up and manage their own on-premise EDI solution,handling daily operation themselves.

In this scenario, the EDI software will link to an ERP system for the automatic conversion and exchange of electronic data in orders, invoices, ASNs and other documents. Increasingly however, companies are discovering that a cloud-based, fully managed EDI service is far more cost-effective. Like on-premise solutions, cloud EDI applications are designed to integrate with internal ERP systems but they have none of the internal running costs or associated overheads. At Transalis, we have developed a scalable, high-performance EDI SaaS (software as a service) application platform, hosted securely in the cloud and ideal for the continual, automated exchange of trading data.

5. Different message types

Because of the digital nature of EDI, solutions have to operate in line with recognised standards and message types.

Without standardisation, trading partners’ systems would not speak the same language and the exchange of data would be neither seamless nor automatic. At Transalis we continually update our cloud-based EDI platform with all the elements required for standardisation. In the run-up to Brexit for example, we introduced a new series of message types specifically to cover customs declarations and other requirements of UK-EU trade documentation.

6. Integration with other systems

To work effectively, your EDI solution has to integrate directly with your other internal management systems.

We’re talking here about your ERP, eCommerce platform and back-office accounting solutions. Successful integration will give you data visibility across your entire operation, perfect for identifying cost savings and other efficiencies as well as generating performance reports. At Transalis, we guide you through the whole process of connecting EDI with your other applications. You don’t have to go ‘under the bonnet’ IT-wise as we do all the ‘heavy lifting’ for you.

7. Examples of EDI

Transalis promises an easy-to-use, simple-to-switch approach to EDI that places customers at the heart of everything.

Leading UK brands such as health and beauty company SpaceNK and home products manufacturer simplehuman UK are among those to benefit already. EDI from Transalis produced immediate costs savings of £60,000 for SpaceNK while simplehuman identified an annual saving of 4,500 hours from the avoidance of manual processing after EDI was implemented.

8. What to look out for when choosing an EDI solution?

The bigger your trading network, the more there is to do to oversee connections and stay up to date.

You want a provider who doesn’t just understand the tech side but who ‘gets’ what your business does and understands what you want to achieve. An EDI solution that can flex to accommodate variable rates of business messaging, while still optimising performance, is best.

You will also need to consider budget. While it may be tempting to go for the lowest up-front price, this can be a false saving. You will want to avoid what is traditionally known as a VAN, or Value Added Network. Under this model, you pay per transaction and data load, something that can lead to unexpected costs over time. Far better to choose a provider who offers clear, transparent pricing.

Similarly, you should demand the reassurance of ongoing maintenance and support, and an easy process for bringing all trading partners on board.

Transalis delivers all of this through our Customer First approach. This guarantees visibility and connectivity across your entire trading network, price transparency and optimised efficiency.

9. How to purchase EDI?

At the outset, it’s essential to analyse your requirements and agree what you want your EDI solution to achieve for you. 

We will help you to do that. We have years of experience in delivering the benefits of connectivity, price transparency and process efficiency. We aim to make EDI simple. Our Transalis eDI™ product bundles provide substantial cost savings and ‘no surprise’ pricing.

10. Why choose Transalis as your EDI partner?

Unlike other systems, our Transalis eDI™ solutions are quick and easy to set-up and operate.

There are no limits set on the number of messages sent and no hidden monthly charges. Entry level eDI Essential, for up to two trading partners, is the ‘buy-online’ hassle-free and cost-effective way to get started with EDI today. Like all our EDI options, eDI Essential benefits from having a dedicated team of EDI experts and developers who are constantly adapting and enhancing our platform in line with global software development and future market requirements. By switching to a managed solution such as Transalis eDI™, you can rest easy.

For more information see our knowledge hub which is a huge resource on understanding the EDI basics, sector insights, case studies, and advice.

To learn more about EDI basics and discuss your individual business needs you can get in contact with our knowledgeable team on 0845 123 3746 or +44 1978 369 343 (for international callers), or contact us via email