Electronic Data Interchange (EDI) September 9, 2015

What is EDI?  Early form of eBusiness created in the 1970s  Electronic communication systems used for exchanging business document such as orders, invoices, shipping notices, etc.)  Uses specific EDI documents standard formats  Business partners should install required software on their computer systems  For communication between their computer systems, partners cans use any of the following:  Peer-to-peer network where the vendor, typically maintains a modem-pool dial-up connections  Value-added networks: communications networks supplied and managed by third-party companies that facilitate electronic data interchange  The Internet 2

Retailer A Retailer C Retailer B Retailer D Wholesaler A Wholesaler B Wholesaler C Wholesaler D EDI Contract A binding contract sets a good/competitive price for the Retailers (buyers) and make the supplier an exclusive vendor for the term of the contract.

Retailer A Retailer C Retailer B Retailer D Wholesaler A Wholesaler B Wholesaler C Wholesaler D Typical EDI Model Retailers don’t have the freedom of buying from any supplier of their choosing. They must order supplies from the suppliers they have sign contract with

EDI technology 5