How EDI and eCommerce Work Together to Streamline B2B Transactions

In the fast-moving digital era E-Commerce businesses need to move faster, speak better and scale smarter. If you are an online retailer, distributor or supplier seeking ways to streamline operations and enhance your order processing, then EDI (Electronic Data Interchange) may be what you’ve been looking for.

What is EDI

EDI means Electronic Data Interchange. It's really the computerized transmission of business documents in a uniform electronic format among businesses. Just think of replacing paper purchase orders, invoices, and shipping notices with secure electronic transmissions. It saves time and resources by avoiding the time-consuming and error-plagued method of manual entry. Important EDI documents are:

• Purchase Orders: These documents start the process of buying, stating the products a buyer desires from a seller, as well as quantities, prices, and delivery.
• Invoices: These documents are outlining the monetary details of a transaction, such as the products or services offered, their prices, and payment conditions.
• Shipping Notifications: These documents notify the buyer of the shipment of their purchase, including tracking details and estimated date of delivery.

What is B2B eCommerce

In the world of B2B eCommerce which stands for Business-to-Business electronic commerce we see one business selling products or services to another business via the internet. As opposed to giants like Amazon which sells to the end consumer or a clothing store which may sell to the public, in B2B we see that sellers team up with retailers, wholesalers, distributors and other companies.

For instance a company in the packaging supplies business may use a B2B eCommerce site to put out for sale boxes, tape, and bubble wrap to retailers which they in turn sell to the end user. These sites also usually feature bulk pricing, order history, invoicing, and account management which in the day to day running of a business are very much required.

B2B in the digital space is what is growing as more businesses are looking for that smooth transfer of the buying process online which they have become used to as users at home. Also B2B is a sector which is seeing great growth as more and out of the gate are putting their processes online for efficiency and error reduction.

How EDI and eCommerce Complement Each Other

EDI works in the background making important data sharing automatic, while eCommerce takes the spotlight, offering an easy-to-use platform for B2B dealings. Here's how they team up to create a situation where everyone benefits: Better Productivity:

• Enhanced Efficiency: EDI makes the sharing of key info easier throughout B2B sales. This cuts out the need to type data by hand speeding up the process and lowering the chance of mistakes. Quicker order handling means faster deliveries and more satisfied buyers.
• Improved Accuracy: EDI uses set data layouts, which keeps messages clear and correct. In regular online sales, typing in data can cause mix-ups in order details, prices, and shipping info. EDI fixes this problem making sure both sides work with the same correct details.
• Streamlined Communication: EDI helps businesses chat without hassle. They can swap order confirmations, shipping updates, and bills online through EDI, getting rid of long email threads and phone calls. This keeps everyone in the loop and cuts down on time spent just talking back and forth.
• Focus on Strengths: By using EDI to handle behind-the-scenes tasks, companies can put their efforts into making their online stores even better.

A Real-World Example: The Furniture Retailer

To show the power of EDI & eCommerce together, let's look at an example from real life. Think of an online furniture seller. As well, there overarching website features all their furniture, with the ability to shop by category, compare products, and add product to their shopping baskets. In the back, the retailer is already EDI connected to their furniture vendors.

• The customer gives an order: When a customer finalizes his purchase on the ecommerce platform, the order details are automatically translated into an EDI purchase order and securely transmitted to the supplier's system.
• The supplier receives the order and confirms: the supplier receives electronically purchase order through EDi, the stock confirms the availability, and confirms the order with the retailer.
• Automatic invoices and inventory updates: Once confirmed, the supplier electronically transmits a challan via EDI, as well as updates their inventory systems.
• Shipment and tracking information: The supplier ships furniture and sends a shipping notification with trekking information through EDI. This data automatically integrates with the ecommerce platform of the retailer, allowing the customer to track his order in real time.

The Future of EDI and eCommerce Integration

Bringing EDI and eCommerce together isn't a fixed idea. As tech keeps changing, you can expect stronger partnerships between the two.

• API Integration: APIs play a role of a bridge between eCommerce platforms and EDI systems which in turn enables smooth data exchange and which also promotes greater automation.
• Real-Time Inventory Management: In a world which our customers’ orders on the ecommerce platform instantly update the supplier’s system we see the elimination of stock.

EDI and eCommerce together present a unified solution which is that of information and transactional flow automation between companies and their customers. What we see is an increase in efficiency, accuracy and in the over arching value to operation.

To learn more about how Infocon Systems can take care of your EDI needs, please don’t hesitate to give us a call at +1 888-339-0722 or email sales@infoconn.com. We’d love to hear from you.

EDI and eCommerce FAQs (Frequently Asked Questions)

1. What is EDI in eCommerce?

With EDI (Electronic Data Interchange), companies can send and receive standardized electronic documents, such as purchase orders, invoices, shipping notices directly to and from their trading partners, right from their billing or purchasing systems.

2. Why do eCommerce businesses need EDI?

Most major retailers and sellers need EDI to automate their orders and decrease human error. For online retail businesses, integrating their operations with EDI reduces the effort in fulfillment and data entry and keeps in compliance with their trading partners.

3. Which eCommerce platforms support EDI integration?

All leading eCommerce solutions offer EDI either natively or through third party solutions. Examples:

• Shopify
• BigCommerce
• Magento
• WooCommerce
• NetSuite (SuiteCommerce)

4. How is EDI integration implemented with eCommerce platforms?

Integration can be done via:

• Middleware or EDI translators
• APIs
• Third-party EDI providers

These applications link your store and trading partners acting as a middle man to translate between formats and send documents.

5. Is EDI integration expensive for eCommerce stores?

Prices fluctuate depending on volume, complexity and provider. Mom-and-pops can get away with basic EDI package offerings, while high volume operations will require custom solutions. Typical pricing is per document, monthly subscription, or a managed service fee.

6. How long does it take to set up EDI for my eCommerce store?

Simple integrations could be completed within a few days. More elaborate installations (multiple partners, custom mapping, testing) can require a few weeks. The process can be facilitated by working with EDI providers that have proven experience.