How EDI Improves Business Partner Relationships

EDI improves Business Partner relationship because it speeds up processes between Businesses and improves the better accuracy of the information they exchange. Customers know from decades of experience with thousands of suppliers that by using EDI documents improves transaction speed and visibility while decreasing the amount of money customer spend on manual processes.

In today’s hyper-competitive environment, inventory levels must be carefully managed and that dictates frequent order cycles with each supplier. It can lead to more frequent orders.

Large customers such as Walmart require EDI compliance from suppliers as a condition for doing business with them. Large customers have sophisticated systems for efficiently managing all phases of the order cycle. They like EDI because their systems for ordering, receiving, warehousing and payment can be set up to automatically interact with EDI capable suppliers.

Below are some major phases of the order cycle from the supplier’s perspective of their relationship with their customers.

The EDI Order Cycle
EDI purchase Orders (EDI 850) and the associated acknowledgments let your customer know you have their order. You get the orders quickly and with precise information for exactly what your customer wants and when they want it. Misunderstanding are minimized. Getting orders sooner enables you to ship faster if your customer wants it. And it gives you more lead time to plan production, packing, and shipping.

Some large customers may want you to ship directly to end consumers. An electronic order cycle is the only way to meet the timeliness of delivery that today’s consumers demand.

EDI Advance Ship Notices (ASN’s or 856) let customers know about shipment is on the way so they can plan their receiving labor and logistics. The ASN tells them how your products are packed so they can receive them quickly and accurately. Bar code labels on your shipping cartons speed up their receiving process and inventory update accuracy.

Not getting paid accurately and on time can put a strain on any relationship. EDI invoices give your customer precise information about your bills which speeds up their accounts payable process. Billing disputes and delays are minimized and you get paid faster. Lost invoices are greatly reduced because EDI acknowledgments let you know your customer has your bills.