What is Electronic Data Interchange (EDI) and how can it benefit my wholesale distribution business?
Electronic Data Interchange, or EDI, is a technology in which communication is transmitted between businesses for such reasons as placing orders, shipping notifications, electronic invoicing and other transactions.
In a very simple terms it takes the “human touch” element out of certain business transactions between manufacturer and distribution, and allows computers over a network to communicate to each other
EDI has mapping, which is to say, established secure paths over the network in which companies can communicate. A simple example is EDI communication established between a distributor and a retailer. It speeds up the communication process and takes provides a much more accurate method to establish business transactions.
EDI in Wholesale Distribution can handle even complex transaction problems such as cross referencing which is when a trading partner orders an item with using one of several numbers, in which none of the items are used to identify that item in your system. Some examples of areas in which cross referencing can help with are; Units-Of-Measure, Ship-To’s, Distribution Centers, Shipping Agents, Payment Terms and many others.
EDI can greatly help Wholesale Distributors streamline their communicate process with their partners. In summary, some of the key areas are listed below.
Benefits of EDI for Wholesale Distributors include:
- Establishes strong communication on transactions between business partners (i.e. Supplier to Distributor, Distributor to Retail Customer, ect.)
- Foster better customer satisfaction
- An increase in business communication speed
- Improves accuracy
- Reduces operational cost
- Keep you competitive
- Improves efficiencies