What is an EDI?

EDI is an abbreviation for Electronic Data interchange.

Using EDI, companies send information digitally from one business system to another, using a standardized format. Some of the types of business systems to which EDI can connect include e-commerce solutions, ERP, WMS, CMS, accounting software, and more.

EDI replaces order processes, transactions, and communications that were done with paper or fax in the past. It’s an important component for automation in business processes.

With EDI, you can exchange digital information and transactions with other businesses for greater accuracy and speed of communication. For example, purchase orders, invoices, advanced ship notices, and other documents can be digitally transmitted via EDI.

The American National Standards Institute (ANSI) Accredited Standards Committee (ASC) provides the X12 EDI data format that is used to electronically exchange business documents in specified formats between two or more trading partners.

How these EDI files are used for data exchange?

Suppose you’re a manufacturer taking orders from customers online. Your website will pass orders into our ERP(Xoro), which will then communicate via EDI so that the order can be sent to the customer.

The transaction begins when a customer sends you an 850 (purchase order). You then send an Order Acknowledgement 855. 

Once your warehouse fulfills the order, they send an 856 (advanced shipping notice) on your behalf to the customer. You can invoice your customer with an 810 (invoice) because you have confirmation that the product has been shipped.

There are other files such as:

860: Purchase Order Change request

865: Purchase Order Change request Acknowledgement

846: Inventory Inquiry

180: Return Merchandise Authorization

812: Credit memo

Xorosoft integrates with many EDI partners like SPS commerce, Orderful, iTrade, etc.