How EDI Works
There are three steps in the process of sending EDI documents, which are as follows:
A buyer prepares an order in a purchasing system by following different approaches.
Exporting computer-based data from spreadsheets or databases
Reformatted electronic reports into data files
Enhancing apps to create output files ready for EDI standard translation
Purchasing EDI software that can turn documents from your systems into EDI files
Human data entry
EDI Document Translation
EDI translation software will convert or translate your internal data format into the EDI standard format. This is data mapping.
Connect and Transmit EDI Documents
There are several ways to connect to a partner via EDI. These include:
Direct, point-to-point EDI connection via a secure Internet protocol, such as AS2
Connect to an EDI network provider, also referred to as a Value Added Network (VAN) provider
A combination of both Direct EDI and VAN, depending on the partners involved and the transaction volume
In the EDI network provider, the buyer uses their preferred communications protocol, thus ensuring reliable, secure EDI transmission. The network provider then connects to the supplier using the supplier’s preferred communications protocol, making sure that the supplier receives the order. VANs can reduce setup and maintenance costs. However, in some cases they tend to be more expensive than point-to-point integration, as they charge a fee for each transaction or even the line item.