EDI Using APIs — The Modern Approach

Traditional EDI uses file-based communication (via VANs, AS2, SFTP, etc.), while API-based EDI uses web services to send/receive data instantly between systems like SAP, Oracle, or Amazon Vendor Central.

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1. REST API in EDI

REST APIs are the modern choice for cloud-based EDI platforms (like Cleo, SPS Commerce, or TrueCommerce).

Example: Sending an EDI 856 (ASN) through REST API

Scenario:
Supplier ships goods to Amazon and sends the ASN using an EDI REST API.

Request:

POST https://api.edi-platform.com/asn
Content-Type: application/json
Authorization: Bearer <AccessToken>

Payload (JSON):

{
  "transactionSet": "856",
  "senderId": "SUPPLIER123",
  "receiverId": "AMAZON",
  "shipment": {
    "shipmentId": "SHIP12345",
    "orderNumber": "PO56789",
    "shipDate": "2025-10-20",
    "items": [
      { "sku": "B0C2ZNX6T8", "quantity": 10 },
      { "sku": "B0C3LMK5P9", "quantity": 5 }
    ]
  }
}

Response:

{
  "status": "SUCCESS",
  "asnId": "ASN78910",
  "message": "ASN received successfully by Amazon."
}

Advantages of REST EDI:

• Real-time integration (no waiting for batch jobs).

• JSON format — easy for modern applications.

• Better visibility and faster error handling.

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2. SOAP API in EDI

SOAP APIs are often used in large enterprise systems (like SAP, Oracle EBS, or healthcare systems) where reliability, security, and transaction validation are critical.

Example: Sending an EDI 850 (Purchase Order) through SOAP API

Request (XML):

<soapenv:Envelope xmlns:soapenv="http://schemas.xmlsoap.org/soap/envelope/"
                  xmlns:edi="http://edi.company.com/">
   <soapenv:Header/>
   <soapenv:Body>
      <edi:SendEDIMessage>
         <edi:TransactionSet>850</edi:TransactionSet>
         <edi:SenderID>BUYER001</edi:SenderID>
         <edi:ReceiverID>SUPPLIER001</edi:ReceiverID>
         <edi:Data>
            <edi:PO>
               <edi:OrderNumber>PO12345</edi:OrderNumber>
               <edi:OrderDate>2025-10-20</edi:OrderDate>
               <edi:Item>
                  <edi:SKU>B0C2ZNX6T8</edi:SKU>
                  <edi:Qty>20</edi:Qty>
               </edi:Item>
            </edi:PO>
         </edi:Data>
      </edi:SendEDIMessage>
   </soapenv:Body>
</soapenv:Envelope>

Response (XML):

<soap:Envelope xmlns:soap="http://schemas.xmlsoap.org/soap/envelope/">
   <soap:Body>
      <SendEDIMessageResponse>
         <Status>Accepted</Status>
         <ControlNumber>000123456</ControlNumber>
      </SendEDIMessageResponse>
   </soap:Body>
</soap:Envelope>

Advantages of SOAP EDI:

• Strong error handling (ACK/NACK within the response).

• Secure (WS-Security, encryption, and digital signatures).

• Reliable delivery (guaranteed message acknowledgment).

EDI 850 (Purchase Order)

What is EDI 850?

The EDI 850 Purchase Order is a transaction set used by a buyer to place an order with a supplier.
It replaces the traditional paper or email-based purchase order and automates the ordering process electronically.

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Purpose of EDI 850

• Communicate purchase information between trading partners.

• Specify items, quantities, prices, shipping instructions, and payment terms.

• Initiate the Order-to-Cash (O2C) cycle.

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Who Uses It

• Retailers send 850s to suppliers.

• Manufacturers send them to vendors for raw materials.

• Distributors send them to manufacturers for replenishment.

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Typical EDI 850 Business Flow

1. Buyer creates a purchase order in their ERP.

2. The system converts it into an EDI 850 format via middleware or VAN.

3. The supplier receives the 850 through their EDI system.

4. The supplier sends back:

   • EDI 855 (Purchase Order Acknowledgment)

   • EDI 856 (Advance Ship Notice)

   • EDI 810 (Invoice)

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EDI 850 in the Order-to-Cash Cycle

Step	Transaction	Purpose
1	850	Buyer sends Purchase Order
2	855	Seller acknowledges the order
3	856	Seller sends shipment notice
4	810	Seller sends invoice
5	997	Functional acknowledgment for each transaction

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Benefits of Using EDI 850

• Eliminates manual order entry.

• Reduces errors and processing time.

• Speeds up order confirmation and fulfillment.

• Improves buyer-supplier collaboration.

• Enables real-time order visibility.

EDI Implementation Challenges Every Business Faces

Electronic Data Interchange (EDI) has become the backbone of modern B2B transactions. It automates the exchange of purchase orders, invoices, shipment notices, and more, ensuring faster and error-free business processes. 

However, implementing EDI isn’t always straightforward. Many companies face roadblocks during setup, integration, and partner onboarding. 

Here are the some of the challenges in EDI implementations and practical ways to overcome them.

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1. Partner Onboarding Complexity

The Challenge:
Every trading partner may have different EDI requirements (formats, versions, and compliance rules). Managing these variations often slows down onboarding.

The Solution:

• Use a standardized onboarding checklist for each partner.

• Invest in middleware or cloud-based EDI platforms that can handle multiple formats (X12, EDIFACT, VDA, etc.).

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2. Integration with ERP and Legacy Systems

The Challenge:
Mapping EDI data into ERP systems like SAP, Oracle, or Microsoft Dynamics can be complex, especially with older or custom-built systems.

The Solution:

• Use prebuilt ERP connectors provided by middleware tools (Cleo, Seeburger, SAP CPI).

• Automate mapping through drag-and-drop EDI mappers instead of manual coding.

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3. Compliance and Standards Management

The Challenge:
Different industries (retail, healthcare, logistics) enforce specific EDI standards and regulatory compliance (HIPAA, GS1, ANSI X12, EDIFACT). Staying updated is critical.

The Solution:

• Subscribe to standards update notifications from organizations like ANSI or UN/CEFACT.

• Partner with an EDI service provider that ensures continuous compliance updates.

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4. Error Handling and Visibility

The Challenge:
When an EDI transaction fails (e.g., missing invoice, incorrect SKU code), it can lead to shipment delays, chargebacks, or lost revenue. Many companies struggle with real-time visibility.

The Solution:

• Implement dashboards with real-time alerts for failed transactions.

• Set up automated acknowledgment messages (997/CONTRL) to confirm receipt.

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5. High Implementation and Maintenance Costs

The Challenge:
Traditional on-premises EDI systems require significant upfront investment and ongoing maintenance, making them expensive for small and mid-sized businesses.

The Solution:

• Consider cloud-based EDI solutions with subscription models to reduce costs.

• Outsource EDI management to a managed services provider (MSP) if in-house expertise is limited.