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Electronic Data Exchange

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Electronic Data Interchange " EDI " technology ensures that communication between companies is standard and electronic. Generally, B2B wholesale companies and those in the production sector are those that make use of EDI software.

Why do companies use EDI?

Standardization of communication through EDI reduces the amount of documents that are exchanged. The messages that are sent through EDI are called a transaction. This transaction clearly communicates all the details of an order or invoice to the supplier or customer. Normally, EDI software is integrated into the ERP system. In this way, you can immediately start the collection of orders or send invoices directly to accounting.

EDI software can be compared with a phone. To use all media, the first condition will be that both the sender and the recipient of the message have the software. In principle, EDI software is found independently of software packages. This means that companies that have different ERPs systems can also communicate through EDI. However, for the same companies it's more important that the EDI software is compatible with the ERP system " already existing ". In this way, EDI transactions are included directly with the ERP.

Second, the format and " language " of the transactions must also meet some conditions. A combination of figures and, occasionally, letters form understandable " words " and " phrases " for EDI software. In this way, companies don't have to worry about natural languages. For example, a clothing merchant in Japan can use the software without any problem to process orders from a business customer in Hungary.

Is EDI used only for buying and selling?

EDI software is often used by companies that are in the world of sales, but communication can also be established for other types of businesses. For example, accounting offices can carry out financial transactions through software, and transport companies can deliver customs documents or confirmation of receipt. Frequently, the latter types of documents are immediately included with the document management system, through integration.

Is EDI a universal computer language?

Often, EDI refers to the EANCOM and EDIFACT standards. These languages are used by EDI software for commerce, transport and administration companies. In addition to EANCOM and EDIFACT, there are also other standards. For example, there is the HL7 for the healthcare sector and VDA and ODETTE for the automobile industry. When choosing EDI software, be sure to check which standards are compatible.

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