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EDI is a game-changing technology for B2B communication. Prior to electronic data interchange (EDI), businesses had to deal with error-ridden fax machines, or even worse, paper mail.
All of a sudden, businesses can accomplish in seconds what used to take hours, days, and often weeks when communicating internationally. In addition to fast communication, EDI presents several other key benefits over traditional B2B communication, such as:
The following are the 10 most common EDI documents (also called EDI transaction sets) that replace traditional paper and fax documents. You can learn more about other common EDI transaction sets here.
An invoice notifies a customer that their order is complete and that you are ready to bill them. An EDI invoice can include information about products and services rendered, the payment terms, and shipping information. Companies often send this EDI document at the same time as shipping the customer’s products.
A customer sends a purchase order to their supplier to place an order. The EDI purchase order lists the items they want to order, the total quantity of each item, the agreed pricing, and shipping information. Since purchase orders are often subject to change, it’s much more convenient to use this EDI transaction than sending paper purchase orders back and forth.
When a supplier receives a purchase order, they will send a purchase order acknowledgment back to the customer to accept or reject the order. When accepting the order, the purchase order acknowledgment will summarize the order in full and confirm that processing of the order is starting. When rejecting the order, the supplier can indicate what information about the order needs to be changed, such as shipping dates or product that is out of stock.
An advance shipping notice informs your customer that their order is shipping to them. This EDI document contains the specific details of their order, such as a list of the items shipped with descriptions and quantities, packaging information, the estimated delivery date, carrier information, and tracking numbers.
A payment order/remittance advice EDI document accompanies an invoice payment. This EDI transaction includes the invoice number, total paid amounts, and banking information when necessary. In most cases, sending a payment order/remittance advice transaction effectively closes out the order lifecycle.
A shipping schedule transaction set outlines the specific requirements for a particular shipment from a supplier. This information includes the target shipping schedule, order details, shipping carrier information, and other details regarding the shipment of an order. This EDI document is crucial for just-in-time manufacturing, which relies on real-time data to accurately manage inventory levels.
Customers will send an order status inquiry to get updated information about a purchase order or select portions of a purchase order. An order status inquiry might request an update about the shipping of an order, the status of a product in manufacturing, the quantity of a set of items that are already shipping, or other related details.
An order status report is the responding EDI transaction to an order status inquiry, providing the information requested. This EDI document can also confirm the completion of an order or the completion of a portion of the order and might include updated shipping information as well.
A warehouse shipping order provides instructions to a remote warehouse for the shipment of an order, including which items to ship, item quantities, the target delivery date, shipping information, billing information, and the shipping method. In most cases, the seller uses a warehouse shipping order to instruct the warehouse to ship an order to the buyer.
Motor carriers send a load tender response to confirm or decline the pickup of a shipment outlined in a previously received offer. In addition to accepting or declining the load tender, this EDI document can accept the load tender with specific conditions, or accept and deny a spot bid request.
In addition to the EDI documents listed above, there are hundreds of other EDI transaction sets exchanged electronically between businesses in a matter of minutes. Without EDI, supply chains wouldn’t be able to meet the fast pace of modern business and consumer demand.
Recently, we’ve improved the efficiency of EDI even further through a cloud-based EDI solution. Now you don’t even have to house the hardware or configure the software required to exchange EDI documents – you can manage all of your EDI transactions from anywhere with an internet connection.
Learn more about how much time and money you can save with BOLD CLOUD!
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