EDI information

» EDI explained

EDI means electronic data interchange, which means exchanging information between trading partners' computer systems in the form of electronic documents (files). These replace paper documents. When integrated properly, the information in them can pass into the recipients' computer systems automatically, without human intervention. This means that people do not have to copy type the content of the documents into their computer systems. Errors through mistyping by the recipient are eliminated and the information can be in the recipients' systems and under process within minutes of the document being sent by the sender. Money is saved and, thanks to the speed of EDI, service levels can be made more responsive.

» Cost benefit analysis of EDI

EDI has a positive impact on a company's finances. For example, there is a tendency to get better cash flow through sending out invoices as EDI documents, getting a reduction in Day Sales Outstanding and making savings in financing your debtors, all true but difficult to measure in advance.

Integrated EDI offers other savings that can indeed be measured in advance. For example, the wages cost of handling incoming paper documents can be calculated easily. Let's say you have a customer sending you just five orders per day. Your clerk makes one error per week that is corrected by the clerk. Once a fortnight an error needs remedy from a manager. Once a year a director has to solve a problem due to an error and finally, once a year, a visit by a sales manager might be needed to fix things with your customer...

The "Little Spreadsheet" illustrates where the savings can be made.
Click here to view spreadsheet

Top three EDI pitfalls

EDI is complicated. This makes EDI difficult to implement and puts companies off so they fail to join your electronic trading community. First B2B, by doing all the difficult work, makes it easy for companies to trade electronically.

EDI has hidden costs, making it expensive. First B2B delivers a fixed-cost, comprehensive service for lower Total Cost of Ownership and predictable budgeting.

Many EDI "customers" are "victims". Some EDI vendors sell only to the few giant corporations with big budgets and thousands of suppliers. Others sell to the thousands of suppliers being forced into EDI by big customers. First B2B makes you a client not a "victim". Your interests come first. Your customers will be delighted - whilst you gain the benefits that big corporations enjoy.