Electronic Data Interchange Solution for The Distribution Industry Sector
Electronic Data Interchange enables businesses to eliminate cost and inefficiencies from everyday transactional flow. The key advantages of Electronic Data Interchange in modern business are: accuracy, efficiency and cost reduction. Accuracy is normally improved up to 40% in business transactions previously processed with errors. EDI eliminates paper usage including production, storage, postage etc. Quick and accurate processing of business documents stimulates efficiency – less re-working of orders and fewer canceled orders.
As the amount of data constantly grows, businesses that do not use EDI are at a disadvantage. More expenses and errors come with handling data and papers manually. Electronic Data Interchange can enable your business to gain a competitive market advantage.
A vivid comparison example of cost reduction: the processing cost of a manual order is $38.00 and doing the same with EDI makes up $1.35
Exchanging transactions in minutes enhances your business cycles – you gain days and even weeks in time. Errors are reduced, illegible handwriting is eliminated, fax and mail lost disappear. Electronic Data Interchange stimulates order-to cash cycle time and therefore improves business partner relationships.
Most used EDI transactions:
- 850 Purchase Order – used in retail for products to be shipped to a DC/store or end consumer. Can contain a single ship to provided marked for/cross dock packing details.
- 810 Invoice – used by supplier to request payment for products or services rendered.
- 832 Price/Sales Catalogue – used to obtain supplier item information and load to their item master file for item updates.
- 855 Purchase Order Acknowledgment – serves as an acknowledgment of the purchase order. Also used by retail and grocery as a suggested PO from the supplier to the buyer for Vendor Managed Inventory.
EDI is a powerful instrument that will strengthen your relationships with business partners, make your operational flow more efficient and increase your customer base. To learn more about EDI and become a certified EDI Professional please visit our course schedule page.