Benefits of EDI from the perspective of a supplier

Summary: All parties benefit from an EDI implementation. The supplier benefits from a reduction in human error, fewer personnel, a reduction in inventory and improved cash flow.

One the primary reasons that adoption of EDI continues to grow is the cost savings associated with removing human error.  There are several more benefits of using EDI and we will look at them from the perspective of a supplier:

Elimination of problems and delays

According to a survey conducted of companies that use EDI, human error was present on as many as 50% of documents. These errors result in shipping delays, missed dates, wrong items, incorrect quantities and ultimately low customer satisfaction. With EDI systems generate their own labels and barcodes like ucc128.


Another key statistic is that as much as 70% of information that comes in is entered again into another computer system. With EDI compliance, all these systems communicate directly. The need for data entry personnel no longer exists.

Reduction in inventory

The problem with just-in-time style inventory is that the burden falls to the supplier. With EDI a supplier can reduce some of that burden by tailoring manufacturing schedules to the demand curves of the customer. All of this

Customer service

With real time status updates on an order, your customer service agents have the information they need to keep the customers informed. With improved order speeds, reduced errors and the additional information, customer service and satisfaction levels increase greatly.

Improved cash flow

The improved invoicing and payment systems result in improved cash flow for the supplier with quicker payments.

Bio: Written by Act Data Services, Inc. 1-800-ACT-DATA. . An EDI service provider for retail and service environments.