SPICE™ Glossary / EDI (electronic data interchange)

EDI (electronic data interchange)

EDI (electronic data interchange) is the computer-to-computer exchange of business documents, such as purchase orders, ship notices and invoices, between trading partners in a standard electronic format.

EDI replaces paper, email and manual keying with structured data that one company’s system can send and another’s can read without retyping. Each business document has an agreed layout, so both sides know exactly where to find the item number, quantity, price or ship-to location. In North America most EDI follows the ANSI X12 standard; internationally, EDIFACT is common.

A typical exchange works like this: your ERP produces a document, EDI software translates it into the standard format through EDI mapping, and it travels to the trading partner over a secure connection such as AS2, SFTP or an EDI VAN. The receiving system checks the file, returns a functional acknowledgment and translates the data into its own system.

EDI matters because it removes re-keying errors and shortens the order cycle. Its limits are just as real. Each trading partner can have its own requirements, setup and testing take specialist effort, and many suppliers, customers and carriers do not run EDI at all. A file can also be technically valid and still carry the wrong quantity or price, so EDI on its own does not guarantee the business transaction is right.

How SPICE™ handles it

SPICE™ exchanges standard EDI with trading partners that use it and brings those that don’t into the same process through APIs, web, mobile, email and documents. Every transaction, whatever the channel, is translated and checked against your master data, the original order and your business rules before it reaches your ERP. See how the platform works, how it reaches every trading partner, and why SPICE™.

Related terms

ANSI X12

EDIFACT

EDI transaction set

EDI VAN (value-added network)

EDI mapping

Trading partner

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FAQ

Frequently asked questions

What is EDI used for?

EDI is used to exchange routine business documents between companies, most often purchase orders, order acknowledgments, advance ship notices and invoices. It is also used in logistics for load tenders, shipment status and freight invoices. Any process where two companies trade high volumes of standard documents is a candidate for EDI.

Is EDI being replaced by APIs?

Not in most supply chains. APIs are growing for real-time, system-to-system exchanges, but EDI remains the established standard for orders, ship notices and invoices between trading partners. Most companies run both, plus portals and documents for trading partners that use neither.