Investing in electronic data interchange services and softwares is a smart move for any business. This goes without saying, so once you’ve come to the same conclusion about the values of EDI it is time to choose a provider. This is where things start to get tricky.
Since more and more companies have started investing in EDI within the last few decades, there is no shortage of choices. So which one is right for you? Are your needs more suited to a software installation or a web EDI service? This is the ultimate question; first you need to figure out if a web-based system is the best choice for your business.
First of all, what is EDI?
EDI is short for electronic data interchange. This sounds extremely technical, but it’s basically just the exchange of data through electronic means. EDI involves a few steps, including data collection, data translation and data transmission.
This means that after the data is collected, it needs to be “translated” into a standard format that is used by both the sender and the receiver of the document. After the data is translated, it can be transmitted to any part of the world – wherever your business partner might be.
What are the major advantages?
There are tons of perks to investing in EDI, a major one being cutting down company costs. Yes, you’ll have to pay for EDI, but can cut down on paper costs as well as the cost of sending documents via postal services. It is also much more environmentally friendly; paper comes from trees, and EDI completely eliminates the need for paper.
Another perk is that it can improve your business relationships immensely. EDI collects, translates, and transmits data in a timely manner and reduces the risk of data entry error tenfold. You business partners will love receiving business-related documents that are 100% correct and arrive on time.
Types of EDI Systems
Now that we’ve covered the basic of EDI and the main benefits of it, let’s talk about the different types. There are 2 main types of EDI solutions: traditional and web-based. Traditional EDI often involves installing a company-wide software on all of your employees’ computers.
Web-based EDI, on the other hand, is completed via an internet browser and replicates paper documents into a web format. Once the data is collected and added to the web browser, it will be converted into the proper format and transmitted via secure internet protocols.
Benefits of a Web-Based EDI System
Traditional EDI is often seen as more reliable and is better suited to large companies and major corporations. Web-based EDI systems aren’t for everyone, but they are definitely the best option for businesses on a budget. Web EDI tends to be much cheaper than traditional systems since you won’t need to invest in a software.
If you run a small to medium-sized business and don’t transmit data to tons of business partners around the world, a web-based EDI solution will do just fine for you. Large companies with a massive need for transmitting documents should invest in a more traditional software.
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