What is EDI Connections in Xoro?

EDI stands for Electronic Data Interchange. It enables companies to send information digitally from one business system to another using a standardized format. EDI can connect various business systems such as e-commerce solutions, ERP, WMS, CMS, and accounting software.

Traditionally, order processes, transactions, and communications were handled using paper or fax. EDI replaces these methods, making it a crucial component for automating business processes. By using EDI, businesses can exchange digital information and transactions with other companies more accurately and quickly. For instance, documents like purchase orders, invoices, and advanced shipping notices can be transmitted digitally via EDI.

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

EDI Document Types

An EDI document type is a specific file format that defines the structure and content of EDI documents like invoices, orders, and order confirmations. Standardized document formats ensure that both the sender and recipient can correctly interpret the exchanged information.

Common EDI document types include:

• UN/EDIFACT

• TRADACOMS

• ANSI X.12

• VDA

• UBL

Communication Options for EDI

To transmit data between trading partners, a communication method is required. The main EDI communication options are:

Value-Added Network (VAN)

A Value-Added Network (VAN) is a private, hosted service that securely exchanges electronic messages between companies, acting like an electronic postal service for trading partners. VANs offer advantages in EDI and supply chain optimization by providing secure and reliable data exchange.

Direct Connections

Direct connections enable trading partners to transmit data directly to each other via secure protocols, offering full control over EDI operations. This method requires an investment in EDI software and a team of IT experts to manage the environment. Common protocols include:

• AS2, AS3, AS4

• FTP, sFTP, FTP/S, HTTPS

• IP over VPN

Web-Based EDI

Web-based EDI is ideal for small companies without technical staff and limited funds. It uses a portal that converts documents into human-readable web pages, allowing quick EDI compliance. However, this method requires manual intervention.

Note: Xorosoft integrates with many EDI partners like SPS Commerce, Orderful, and iTrade.

Common EDI Documents from Xorosoft's Perspective

EDI Purchase Order (850)

The 850 is an inbound document used by a customer to place an order with a business. It typically includes item specifics, quantities, pricing, discounts, and shipping details. When integrated, the PO data is automatically translated into a sales order.

EDI Functional Acknowledgment (997)

This outbound document acknowledges the receipt of a customer's purchase order or another EDI document. It confirms receipt but does not indicate acceptance of the order's terms. A 997 can also be inbound from a customer, confirming receipt of a document sent by you.

EDI Purchase Order Acknowledgment (855)

The 855 is an outbound document that confirms receipt and acceptance of a purchase order. It can indicate order acceptance or rejection, pricing or quantity changes, product availability, and shipping dates, closing the communication loop electronically.

EDI Advance Shipping Notice (856)

This outbound document notifies the customer that an order is being shipped. It includes details on shipment contents, packaging, carrier information, tracking numbers, and delivery dates. Some trading partners use the 857, combining ASN and invoice in one document.

EDI Invoice (810)

The 810 replaces the traditional paper invoice, indicating that the order is complete and has shipped. It includes details on the goods provided, shipping information, and payment terms.

By leveraging EDI, businesses can streamline their operations, reduce errors, and improve the speed of transactions, contributing to more efficient and effective business processes.

How are EDI Files Used for Data Exchange?

Here's an example of how EDI facilitates data exchange:

Suppose you are a manufacturer taking orders from customers online. Your website passes orders into the ERP system (like Xoro), which then uses EDI to send the order details to the customer.

1. A customer sends you an 850 (purchase order).

2. You respond with an Order Acknowledgement (855).

3. Once your warehouse fulfills the order, they send an 856 (advanced shipping notice) to the customer.

4. You can then invoice your customer with an 810 (invoice) because you have confirmation that the product has been shipped.

This process streamlines communication and ensures that transactions are processed efficiently and accurately.