EDI Compliance: What It Is and How to Achieve It

Three tips to put your product in more places.

A major trading partner has agreed to carry your products. Congrats! But now you have to step up your game even more with EDI compliance.

But first, let’s take a step back…

What is EDI?

EDI — or Electronic Data Interchange — is the electronic communication of business transactions between suppliers and trading partners. Purchase orders, confirmations, invoices, shipping updates… These and many other transactions can be handled by EDI.

Back to EDI Compliance

EDI compliance is actually pretty straightforward and simple.

Every trading partner has its own EDI requirements that they’ll provide to a supplier. When the supplier is meeting those requirements, they’re EDI compliant.

What are the Benefits of EDI Compliance?

When a supplier is EDI compliant with their trading partner, they achieve a number of benefits including:

Increased efficiency
Improved data accuracy
Reduced errors and costs (i.e., chargebacks)
Greater supply chain visibility
Happy trading partners

What are the Risks of Non-Compliance?

Typically, if you’re not EDI compliant, retailers won’t work with your brand.

In the EDI testing stages, the larger retailers will, among other things, set testing time limits. If a supplier exceeds those time limits, they’ll be non-compliant. For example, Walmart gives suppliers six weeks to complete EDI testing. If they fall short, they’re deemed non-compliant.

Learn more about how EDI testing can ensure smooth and efficient document exchange, reduce errors and rejections, and maintain strong relationships with trading partners.

Similarly, if a supplier consistently falls out of compliance and earns poor marks on their retailer scorecard, there’s a good chance the trading partner will dump them.

No one has time for non-compliance.

OK, EDI Compliance is Important. How Do I Consistently and Predictably Achieve It?

The most efficient path toward achieving EDI compliance is EDI software. Suppliers can either handle this in-house or with the support of a full-service EDI provider.

Managing EDI in-house is a big responsibility. There are significant infrastructure and staffing costs and you’re responsible for maintenance, downtime and system updates. And more often than not, EDI knowledge resides with just a few employees.

Alternatively, working with an EDI provider comes with significant advantages. There’s minimal upfront investment and you’ll get access to expert EDI knowledge and customer support. They handle mapping and system maintenance. But perhaps most importantly, they free up your team to focus on other tasks.

Bottom Line

EDI compliance is non-negotiable. If you fall short, you'll upset your trading partners and jeopardize potential growth and profits. A partner like eZCom can make sure that doesn't happen.