Manually sending invoices or purchase orders between your business, suppliers and customers causes inefficiencies. From data-entry errors to documents simply getting “lost” in someone’s inbox or during postage, relying on manual processes to share business information is cumbersome and costly. Electronic Data Interchanges or EDI solves this problem by automatically transferring information between trading partners.
In this article, we outline everything you need to know about EDI and why your business should embrace this technology.
What is an Electronic Data Interchange (EDI)?
An EDI is the technology infrastructure that facilitates the exchange of information between trading partners. It’s estimated that 80 to 90 per cent of business-to-business traffic occurs through EDIs, growing by around 3 per cent each year. Instead of sending information via email, businesses can collaborate through one simplified system which automates the processing and fulfilment of purchase orders and invoices, among many other documents. The technology behind an EDI allows businesses to trade with other businesses around the world with features such as currency conversion built-in.
What are the benefits of exchanging information through an EDI?
Exchanging information through an EDI provides many benefits to both parties in a transaction. The key benefits include the free flow of information along with the ability to transact with companies around the world on one simple system. Eliminating inefficiencies and risks such as data-entry, reconciliation and reporting errors while adding value to an organisation.
The other key benefits of exchanging information through an EDI include:
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Whether you’re looking to modernise your payments infrastructure and get paid faster or transform other systems across your business too, Spenda’s unique solutions can help improve your business systems and processes and cash flow management.
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This article is for general information purposes only. Consult a qualified financial advisor regarding any changes to or decisions about your business’s finances.