In the 1960s, the U.S. transportation industry developed EDI to enable thorough and accurate communications between multiple companies’ computer systems. Its objective was to standardize electronic transactions between customers and vendors.
EDI was quickly embraced by the U.S. grocery and automotive industries. Today, all major industries employ EDI and are required to follow Compliance EDI. This is a set of standards governing the flow of electronic documents between companies, streamlining and enhancing the supply chain.
The retail industry is a major force behind Compliance EDI. Retailers such as Walmart, Home Depot, JC Penney, Costco, and Sears demand that their suppliers comply. These companies, along with many others, keep “score cards” on their vendors, and EDI capability ranks high on the list of requirements.
For retailers, EDI means:
- Better information flow
- Improved inventory management
- Reduced Costs
- More-accurate accounting
By implementing EDI, companies cut administrative costs dramatically, driving down retail prices.
Sets of EDI standards such as X12 and EDIFACT govern the content and structure of documents. Each industry publishes its own set of guidelines on how to implement these standards. X12 is the primary standard used in the U.S., while EDIFACT is the primary standard in Europe.
TrueCommerce brings the most advanced, affordable and easy-to-use EDI solutions to small-to-medium vendors in the U.S. and Europe.
To learn more about EDI, check out the section on “What is EDI?“