Know Different Types of EDI Services and Which One Suits Your Business Better?

A3Logics 29 Feb 2024


The landscape of business today is evolving at a tremendous speed which requires productive and cost effective solutions. Among many services available for data exchange, Electronic data interchange ( EDI) remain on top with regard to proficiency and secure moving of business documents electronically like shipping notices, purchase orders, invoices etc. Businesses are continuously moving towards modernizing EDI and use it in their processes. EDI uses standardized formats like ANSI X12 and EDIFACT to ensure that the data is exchanged seamlessly between businesses.  EDI is a solution to all inaccuracies, delays and communication gaps between the organizations of all sizes and industry including retail, finance, healthcare , banking etc. Fortune Business Insights expects the global EDI market to be worth over $4.5 billion by 2030, with a CAGR of 12.5%“. 


Benefits of EDI

Why are EDI Services Important for Your Business?


EDI standards are the globally accepted standards for business exchange which increases accuracy, efficiency and productivity. Organizations with traditional processes struggles with errors ultimately leading to increased time and costs. Electronic data interchange comes as a powerful solution for organizations to deal with their everyday processes with ease. Be it healthcare provider or retailer to manufacturer, all rely on EDI service providers in the USA for error-free and faster data exchanges. IBM believes that “EDI in its various formats will remain highly useful and widely used in its established areas for years to come”


An estimated 80% of large organizations and 40% of small and medium-sized enterprises (SMEs) use EDI for business-to-business communication.


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Different Types of EDI Services


One business partner can be connected to another via EDI software. Enabling EDI transactions with your trade partners can be done in a variety of ways because an EDI solution should be dependent on a company’s trading partners as well as their size, importance, and transaction frequency. To find out more about the different types of EDI solutions that can come in handy are mentioned below. 


Direct EDI/Point-to-point


Point-to-point, or direct electronic data interchange, is a common term in the retail industry and refers to the direct line of communication between two trading partners. There has been discussion of direct EDI as a VAN substitute.


Large businesses that conduct a lot of business with other partners choose to employ this strategy because it gives the business partners control. You will require an EDI software platform that complies with your implementation communication protocol specifications if you intend to use a direct connection.




SFTP, FTPS, FTP over VPN, and EDI Through FTP/VPN are all frequently used communication protocols for EDI transactions over the Internet. With the help of an EDI network service provider or directly through one of these, business partners can be connected to.




The EDI network service provider, also referred to as a value-added network (VAN), is an alternative to the direct EDI framework and was operational long before the Internet.

Many firms choose this network model because it protects them from the constant hurdles of keeping up with the multiple communication protocols that different business partners require. Private networks known as VANs are used by partners to exchange electronic commercial papers. In addition to managing the network, the VAN provider sets up mailboxes for enterprises so they may send and receive EDI documents.


EDI via AS2 


AS2 is a network communications protocol that enables safe data transfer via the Internet. It is made up of two computers that communicate point-to-point across the internet: a client and a server. Using digital certificates or encryption, AS2 creates an “envelope” for EDI data that allows for safe internet transmission. Everyone can readily access this form of EDI.


Web EDI 


The method of performing an EDI transaction over a web browser is known as web EDI. It is an online form that looks like paper documents. Sections for information entry will be included in the form. Following the provision of the necessary data, the document is converted instantaneously into an EDI message and transmitted using secure internet protocols, such as AS2, HyperText Transport Protocol Secure (HTTPS), or File Transfer Protocol Secure (FTPS).


Mobile EDI


In the past, users have sent and received business papers about EDI across a network, such as the Internet or a VAN. Security issues and restrictions on screen quality or device size have limited the use of mobile EDI apps. However, a growing industry is developing EDI apps that can be downloaded on mobile devices. Mobile EDI applications are available, for instance, through Oracle’s JD Edwards EnterpriseOne.


Outsourced EDI


Businesses can engage outsourced EDI environment management specialists thanks to a rapidly growing solution called EDI outsourcing, often known as EDI managed services. The necessity for enterprises to integrate with back-office business systems, such as enterprise resource planning (ERP) systems, is one factor driving this. This is advantageous because a lot of companies dislike dedicating internal resources to the ongoing and monotonous EDI transaction chores.


Indirect EDI


The exchange of information via an EDI broker or value-added network between an ERP and clients, suppliers, or third-party logistics service providers (3PL) is known as an indirect EDI transaction. The message is initially transmitted from the ERP to the broker or VAN, along with all the information you desire from your business partners. The broker then delivers the communication to the appropriate parties after dividing it into different formats based on the preferences of your vendors or customers.


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Which Type of EDI Services Suits Your Business Better?


There is a wide range of EDI provider options available in today’s landscape. Choosing the right service provider is a complicated decision that would require the study of certain factors. Choose an EDI provider who not only would meet your ongoing business needs but also be following the organization’s spending plan, size, and specialized abilities.


As far as large companies are concerned, it is better to go with a hybrid approach of EDI which caters to individual trading partner’s needs. For this kind of organization, EDI services through a VAN provider are much more secure and reliable than any other option. This is because it offers many features like security measures, data translation, etc. which are required for complex B2B transactions.


Alternatively, for a merchant/small company, Web-based EDI is preferable as it requires less maintenance cost.



EDI options available


Checklist to Consider Choosing the EDI Services Provider


The following are a couple of focuses you ought to look at while picking an EDI services provider:


Custom-Driven and Responsive:


Pick a vendor who comprehends your production network needs and long-haul business objectives. Check things like their client commitment approach, administration conveyance, reaction times, etc. Understanding your concerns isn’t sufficient. Do they likewise have a group who can think of a fast arrangement and execute it in the correct way? 


Organization Portfolio:


– Check your potential EDI provider’s previous projects, the sort of tasks they have done in the past in a comparative space as yours.

-Do they have a well-rounded portfolio to suit all your business?

-Do they offer a far-reaching support bundle with nonstop accessibility to tackle every one of your inquiries?




-Examine regardless of whether the merchant you have picked has straightforward B2B processes.

-Do they work with a predefined set of standards? 


Adaptability and Asset Abilities:


-Check how many EDI assets your picked service provider has.

-Is it true or not that they are working with restricted assets?

-Might they at any point increase their assets assuming the need emerges in your undertaking from now on?

-Do they have industry-suggested EDI foundations, apparatuses, and abilities to help your task?



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Businesses have many choices when selecting electronic data interchange (EDI) services for their organization’s needs. Depending on its size and nature, some may prove better suited than others. Hiring an EDI service provider offers various benefits to organizations:


  • Better Efficiency
  • Decreased Costs
  • Improved Security
  • Scalability
  • Increased Efficiency
  • Gained Understanding




What Is an Electronic Data Interchange Service (EDI Service)?


EDI services allow businesses to securely exchange documents, orders, and payments over the Internet quickly and safely, providing secure communication channels between offices.

What types of Electronic Data Interchange services exist today?


There is an assortment of EDI services currently available ranging from basic messaging EDI, web-based EDI, cloud EDI, and VAN (Value-Added Network EDI).


What Are the Advantages of an EDI Service? 


Utilizing an EDI service provides numerous advantages, including increased accuracy, cost savings, enhanced security features, scalability, and increased efficiency as well as a greater understanding of supply chains and customer information.


How Can I Select an EDI Service That Will Best Suit My Organization?


Selecting the ideal type of EDI service depends upon several variables such as business size and complexity as well as data requirements as well as cost considerations like scalability and security.

Is utilization of EDI service possible without prior experience or knowledge?


In general, the development of most of the EDI services is user-friendly to facilitate easy set-up even by those without extensive prior experience with similar systems.


What features should I look for when selecting an EDI service provider?


Assuming you already own software programs that interact with an EDI solution, look out for features such as comprehensive analytics tools, customizable settings, compatibility with current software programs, and seamless integration into new systems – in addition to user-friendliness so all users can quickly navigate its interface without difficulty.

What factors should I keep in mind when selecting an EDI service?


When identifying an EDI provider, take into consideration factors like cost, scalability, security features, and user-friendliness. Also,  look at the data exchange requirements through your system to meet its demands efficiently.

What customer service level can I expect from an EDI service provider?


Most EDI support service providers provide excellent customer support that ensures your system runs effectively for you. When selecting providers, prioritize those offering technical assistance, EDI training programs, and ongoing assistance as these will likely offer superior support services.