What is EDI?
Electronic Data Interchange, or EDI as it is commonly referred to, is the computer-to-computer exchange of standard business documents in electronic format between two companies. It simply replaces paper-based documents with electronic documents. The sending company creates the electronic message and the receiving company interprets the message - without the need for any human involvement.
The two key concepts of EDI are:
- Electronic documents replace paper based ones
- The exchange of documents takes place in a standardised format
GS1 Ireland allocates directly to a company engaged in EDI, a GLN for mailbox identification. The company may use this number as the primary company identification within the message itself. Using these two basic concepts, any business can implement EDI and take advantage of its speed, accuracy, efficiency and cost savings.
GS1 provides globally agreed standard definitions for a wide range of electronic business messages, including:
- Purchase order
- Despatch advice
- Receipt advice
EDI is an enabler for automating many important business processes, such as order-to-cash, planning, forecasting and reporting.
A beginner's guide to electronic data interchange