EDI vs. API: Debunking the Myth that API Is Replacing EDI

Enhancing communication between business partners is crucial for increasing productivity. To share large volumes of order data efficiently, trading partners typically rely on two primary technologies—Electronic Data Interchange (EDI) and Application Programming Interfaces (APIs).

EDI has been the gold standard in supply chain integration for decades. But with the rapid rise of APIs across industries, many businesses are beginning to question whether APIs are a newer, better alternative—and if EDI is becoming outdated. The truth is, it’s a myth. APIs aren’t replacing EDI—they’re complementing it. Each technology brings unique strengths, and when used together, they can deliver powerful results across the supply chain.

Understanding how EDI and APIs differ—and how they can work in tandem—is key to choosing the right integration approach for your business.

The Difference Between EDI and API

Comparing the advantages of API vs. EDI starts with understanding their core functions. EDI automates the exchange of standardized business documents, such as purchase orders and invoices for wholesale orders with retailers and distributors. It’s built around defined data formats and transaction sets that enable accurate communication between systems, with minimal manual intervention.

In contrast, APIs create real-time connections between systems, allowing data to move instantly over the web. API technology is often used to connect ecommerce platforms, ERP systems, and other applications in near real time—an attractive feature for companies managing live inventory updates or customer-facing experiences.

Some businesses assume APIs are inherently faster and more flexible, leading to the misconception that APIs will eventually replace EDI. However, this overlooks a key factor: compliance. Many large retailers, distributors, and logistics providers still require EDI to maintain uniformity and consistency in their supply chain operations. Without EDI capabilities, businesses may find themselves unable to meet these partners’ mandates—regardless of how modern their internal systems may be.

So while APIs offer speed and interactivity, EDI remains essential for ensuring compliance and scalability across diverse partner networks.

EDI vs. API for B2B Data Transmission

The decision between EDI and API isn’t always an either/or scenario, as the myth would have you believe. In fact, most modern supply chains benefit from using both technologies, depending on the nature of the data being exchanged and the preferences of trading partners.

EDI Pros

EDI is standardized across different industries for a reason — it effectively transmits data between suppliers, third-party logistics providers, carriers, and other partners. An EDI solution replaces communication methods like email and faxes with electronic document exchange to increase operational efficiency and improve relationships between business partners.

EDI Pros

• Widespread Adoption and Accessibility: Since EDI has been the standard data transmission method between trading partners for years, its use is widespread across the logistics industry. Companies wanting to use EDI are sure to find a range of partners already set up with the technology.
• Structured Communication: EDI formats reduce errors through strict validation and structured mapping.
• Security: Trading partners must have an agreement with stakeholders before communicating using EDI, which increases security and tracking. EDI protocols also provide robust privacy and security settings.
• Ease of use: EDI solutions turn demanding paper-based communication into a streamlined process requiring less manual input from employees. EDI frees companies from inefficient manual processes, allowing them to focus on other business tasks.

EDI Cons 

• One-to-one transmission: While an EDI system can operate across many trading partners, each transaction only communicates between two enterprises. A new EDI connection, or “map” must be created for each transaction type and each trading partner.
• Timing of data exchange: While modern EDI systems can transmit documents in near real-time, some legacy or flat file-based implementations may still rely on scheduled batch processing. This setup can introduce slight delays compared to APIs, which are often used for real-time data exchange—especially for dynamic needs like inventory availability. Businesses that require instant, synchronous communication may consider supplementing or integrating EDI with APIs depending on their use case and trading partner capabilities.

While batch-based EDI may seem slower than API on the surface, modern EDI platforms can process large volumes of transactions in near real time, with the added benefit of reliability and partner compliance. These are areas where APIs alone may fall short, especially in regulated or high-volume environments.

API Pros

• Faster communication and updates: APIs are ideal for scenarios that require immediate, real-time data exchange—such as checking inventory levels, validating pricing, or confirming order status on the fly. Because APIs enable direct, synchronous communication between systems, they can eliminate the delays sometimes associated with batch-processed data.
• Simplified data transmission: While EDI requires that employees manually input data before transmission, APIs automatically accrue data. APIs also remove the need for matching versions because the software uses in-place systems like Enterprise Resource Planning (ERP) systems.
• Flexibility: APIs are adaptable and anticipate new supply chain processes and management technology. Companies can integrate APIs with ERP systems, warehouse management systems, transportation management systems, and other core supply chain platforms to streamline operations and enable more responsive, data-driven decision-making.

API Cons

• Lack Standardized Formatting: While APIs offer greater flexibility and modern integration capabilities, they can pose challenges in B2B environments due to the lack of standardized formats, increased integration overhead, and limited compatibility with legacy systems. Security & Compliance Management Overhead: While modern APIs support strong security protocols, managing security and compliance across multiple API connections can create overhead. Each partner may use different security methods and compliance rules, which requires more effort to monitor, maintain, and audit. In contrast, EDI often runs through centralized systems that handle things like data validation, error tracking, and compliance checks automatically. 

Myth Debunked: EDI and APIs Are Better Together

While it’s tempting to believe the myth that APIs are a “new and improved” version of EDI, the reality is far more collaborative. The best-performing businesses leverage both EDI and API technologies to meet diverse partner requirements while optimizing their internal operations. 

EDI and API technologies have their own benefits and potential challenges. EDI will likely remain an essential tool in business communications, though the flexibility and speed of API data transmission is a valuable benefit. Some companies may wonder if they can capitalize on the advantages of both systems. Fortunately, when you’re considering API vs. EDI technology, the answer can be both. 

The best solution is EDI and API integration. EDI and web-based API solutions can combine on one platform to provide trading partners with a more comprehensive approach to B2B information exchange. A hybrid EDI and API integration platform facilitates data sharing across the two technologies. 

Combining EDI and API offers logistics companies several advantages. EDI integrations automate data transmission between multiple systems to enable faster communication. This strategy also allows businesses to gain a firmer foothold in the market and opens business opportunities with new trading partners. With modern integrated EDI solutions, trading partners can have the best of both worlds.

API Integration with the TrueCommerce Platform

At TrueCommerce, we recognize that no two supply chains are alike. That’s why our unified commerce platform supports both EDI and API integrations—giving your business the agility it needs to operate across multiple channels and technologies. 

Our EDI solution is built on an API-first, open architecture that connects to ERPs, eCommerce platforms, marketplaces, and more. Whether you’re processing traditional EDI documents or looking to integrate real-time workflows with APIs, TrueCommerce makes it easy to seamlessly connect your supply chain. Request a demo of our software today to see what the TrueCommerce platform can do for your business communications.