Electronic Data Integration (EDI) has been around for decades and has helped businesses to securely transact data between suppliers, vendors, customers, and shipping companies securely and quickly. Some of the uses of EDI are for billing, ordering and fulfilment of orders. What is an EDI Ordering System?
EDI Ordering System & Billing System Benefits
EDI billing was developed mainly to allow the automotive industry to implement Just-in-Time (JIT) order processing and inventory management across their supply networks and own manufacturing plants. EDI ordering and billing automates the ordering and billing process to significantly reduce costs and increase speed of fulfilment.
The old school way of doing this of course is by sending a purchase order to a supplier, who then processes that order and generates an invoice to be paid by the customer within a set period of time.
With the EDI version of this the system is integrated between the two parties and all steps become automated. The customer first of all fills out an EDI purchase order which is then sent instantaneously straight to the ERP system of the supplier creating an order to ship the product, and generating an invoice which is automatically sent in return to the customer. The customer can choose to automate payment of the invoice as well, perhaps receiving a discount from the supplier for this. This whole process rather than being spread over a couple of days can take place easily within a few seconds creating time efficiencies. A number of personnel are taken out of the process as well bringing large cost savings.
EDI Ordering Integration with Ecommerce
Software is also available which can commence the order process at ecommerce level for either corporate or consumer customers. Using a payment platform which takes upfront payment the billing process is simplified, but many customers will still need an invoice sent by email to them for accounting purposes.
Order Tracking & Fulfilment
Additional integrations can be made with either drop-ship suppliers or shipping companies to automate shipping and delivery. These can also provide tracking information to the company or even directly to the customer who can then track their order and even stipulate the exact delivery schedule. This greatly reduces customer enquiries regarding delivery times, and then communication between suppliers, vendors and shipping companies as to where an order is at in the process.
Clearing the adoption of EDI ordering and billing is advantageous to a company to reduce costs and improve transaction duration turn around. When integrated with other solutions such as ecommerce integration, drop-shipping arrangements and integration with the fulfilment supply chain, all parties benefit from a more efficient order and billing process, and the end customer’s expectations will be exceeded in terms of the speed of delivery and the transparency of the order process throughout their wait for delivery. Smaller companies that implement these integrated order processes are empowered to compete with larger competitors, and can realistically consider supplying large retail groups and a massive network of online retailers.
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