Value Added Networks: How to Select a VAN Provider for EDI

Consider your organization’s growth potential when choosing a VAN.

By Molly Goad 

If you need a VAN (I’m talking about a value-added network — not a vehicle), one crucial element to consider is the future of your business.   

(A value-added network is a third-party electronic data interchange service provider; refer to What’s a VAN? for the basics.)  

Value-Added Network Selection 

The moment you’ve been working toward has arrived: A large retailer wants to house your product. You’re excited and seek to onboard a VAN quickly so you can begin doing business. You may look at the most basic VAN provider and plan, and dive in headfirst. Simple is all you need right now for your little baby.  

But wait. I know you’re never going to say “no” to growth. As your company expands with new products and more demand, the number of EDI transactions will no doubt increase. What was once an affordable VAN bill often skyrockets.  

Why?  

Because the pricing is often based on the number of kilo-characters transmitted each month (a long-standing model derived from telecommunications billing practices). This means the more you use EDI, the less ROI you get because the costs are attached to the amount of data you use. 

It’s the opposite of the “buy more, save more” promotions many marketers and retailers use. And that kind of stinks, doesn’t it? When I must purchase something in bulk, I’d like to catch a break (thank you, Costco).  

What’s a kilo-character? 

It’s time for a math lesson. One thousand characters equal one kilo-character (KC). Generally, one EDI document is made up of 2,000-3,000 characters. (Every single space, letter, number, symbol, etc. is its own character.)  

Therefore, one transaction means 2-3 kilo-characters going across your VAN. (See what I did there? Math is fun.)   

Your monthly bill is calculated by adding the number of KCs in each purchase order, invoice, advanced ship notice, and every other EDI transaction transmitted during the month, and multiplying by the rate in your contract (typically 5¢ to 25¢ or more). 

KC pricing means your VAN bill will fluctuate 

Because the EDI usage isn’t always the same every month, the VAN bill won’t be, either. It is difficult to discern exactly how much EDI is going to cost you. You end up spending time deciphering your VAN bill and wondering if you’re being charged correctly. 

But it doesn’t have to be this way.  

Enter Trader Partner Pricing 

There is an alternative: trader partner pricing. With this structure, you pay a fixed price for each active trading partner in your network each month. 

You will enjoy more clarity in the monthly budget because it’s easier to predict when you will add new trading partners than it is to predict when your EDI usage will go up or down.  

BOLD VAN’s trader partner pricing charges your business for the number of trading partners you exchanged data with for that month ― you aren’t charged for the total amount of trading partners you have set up in our EDI network. 

BOLD VAN Supports You 

Our trading partner pricing covers much more than EDI software and services. At no extra cost, we provide:  

  • migration to BOLD VAN (setup and implementation) 
  • trading partner migration 
  • an ID and Qualifier (if needed) 
  • EDI compliance with specific trading partner requirements 
  • EDI translation 
  • technical support 

In addition, there are no long-term contracts, and you can leave with a 30-day notice. (I’m not saying you’d want to, but it’s always nice to know you’re not locked in.) To find out how to get started, contact BOLD VAN by calling 844-265-3777 or emailing info@boldvan.com

Recent Posts