EDI is document-based. A purchase order or invoice is built to an agreed standard such as ANSI X12, sent as a file and processed by the receiver, often in batches. The standards are mature, shared across whole industries and well understood by trading partners, which is why EDI still carries most orders, ship notices and invoices between companies.
An API (application programming interface) is request-based. One system calls another over the web, usually with REST and JSON, to send an order, check inventory or get a shipment status, and gets a response straight away. APIs suit real-time needs and modern applications, but each API is defined by the company that publishes it, so there is less industry-wide standardization than in EDI.
- EDI: standard documents, batch or near real time, built into established trading partner programs.
- API: direct system-to-system calls, real time, flexible but specific to each provider.
In practice, most companies need both. Large trading partners may require EDI, newer platforms and carriers may offer APIs, and many suppliers and customers use neither. The real issue is not choosing one, but making sure orders arriving by API, EDI or document are validated the same way before they reach your ERP.