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HOW EDI BENEFITS BUSINESSES?

Relying on manual processes to ensure conditions of a deal are met is a cumbersome
and obviously error-prone process. An EDI solution will replace a lot of manual
processes with automated transactions, by setting up a communication network
between systems in a supply chain.

The growth of EDI software solutions is a lot like that of other business software
systems like ERP. Once a luxury of large enterprises, it’s made its way into the hands

of small and medium businesses. It differs, however, in that a large trading partner,
retailer, or distributor often imposes EDI as a requirement on members of its supply
chain. So, being able to trade with large companies who require partners to have an
EDI solution for transactions is the big picture benefit of implementing the software.
On a smaller scale, the EDI software also improves efficiency for a growing small and
medium enterprise.

BENEFIT #1 – TIME SAVING AND SPEED IMPROVEMENTS

Some of the benefits of EDI solutions are quite straightforward. The speed in which
information flows with EDI systems is a clear example of that. With an EDI solution,

incoming orders are created automatically, not needing user input or taking up
employee time.

There are no delays due to different time zones, or having to get a person familiar with
the term on the phone. No faxes, or paper trails, leading to better cash flow, faster buy-
sell cycle time, shorter lead times, and reduced inventories.

BENEFIT #2 – ACCURACY AND ELIMINATION OF MANUAL ERRORS

The reliability of the information being exchanged between businesses improves with

an EDI solution. Companies see a reduction of errors by eliminating manual and
duplicate data entry. With access to the data of ERP systems, EDI solutions serve as
not only the medium in which the information travels, but also ensures that information
accessed and received is not only accurate but that conditions for the transactions are
met.

This leads to improved relationship with trading partners, minimizing costly charge
backs, late deliveries, or incorrect product prices.