10 Factors to Consider While Evaluating an EDI Service Provider

You are here because you probably understand the basics of EDI or EDI and how it can help you simplify and facilitate communications with your business partners and within the organization. However, the next steps can be tricky since there are a myriad of options to choose from and you are also evaluating the type of EDI solution that best suits your business.

Before we can dive into the factors that will help you evaluate EDI vendors, let’s cover what an EDI provider can do for you and the options available.

What are the different types of EDI Providers?

EDI providers are ultimately divided into three classes of AS2, EDI VAN, or Embedded EDI solution providers.

EDI AS2 Providers

AS2 or Statement of Applicability 2 providers transmit data using the HTTP (TCP/IP) protocol on the Internet through an authorized server. The advantage of AS2 is that it can handle any type of file format and can be deployed using existing IT resources. You can also outsource to a cloud-based resource if that works best for your organization.

Electronic data interchange of service providers

Investopedia A VAN or Value-Added Network (VAN) is defined as “a private hosted service that provides businesses with a secure way to send and share data with their peers.” Therefore, a hosted VAN provider also known as an Electronic Data Interchange Intermediate (EDI), can easily move and pass communications between a private network or a cloud-based EDI provider because it is pre-connected to the trading partner community.

As the name goes, VANs add value to the process. They coordinate and verify that data before passing it on to the trading partner. If your business partner does not have an Electronic Data Interchange (EDI) solution, the VAN service provider can send the message as a PDF and mail it to the interested party. Each transaction is billable although this can be very costly if you are dealing with large amounts of data exchange. So, you can have a look at the combination of AS2 and VAN Provider.

Embedded EDI solutions provider

The embedded software is written either in or on top of the app. It is fully integrated with your ERP, thus pulling data directly from the ERP system and vice versa. EDI as a standalone solution has the ability to facilitate and automate the process of document exchange between business partners. When EDI is integrated or connected to your ERP, these capabilities extend to transform other business functions such as supply chain operations, logistics operations, vendor relationships, and customer relationships.

Implementation of electronic data interchange

You may be thinking about the type of implementation best suited to your business, big or small. You may have questions like:

Should I use the integrated EDI software internally?

If you have the resources and find a SaaS solution that works for your organization, an integrated EDI solution can help you significantly simplify the communication process while getting complete visibility of all your data.

However, you will be looking at investing in an EDI, mapping and translation add-on, and a team to manage the EDI and support any upgrades or requirements around the EDI.

Will my organization benefit from an externally managed EDI or service provider?

If you decide that outsourcing the process is the way for you, then your EDI provider is responsible for everything from customer support to translating EDI messages.

You will have more questions as you go. But it is essential to write it down and check the list of EDI vendors you are evaluating before making a decision.

From our experience over the past 16 years as a reputed EDI solution provider, we have outlined 10 factors we shared with our clients that helped them rate the best shortlisted EDI Providers.

Ten factors to consider while evaluating an EDI service provider

1. What connections and integrations are supported?

There are a lot of communication possibilities within the solution. Therefore, you need to assess the type of connections your business needs and check if an EDI solution provider can help you with that.

Next, you need to think about what kind of integrations you need between ERP, business systems, and EDI. Evaluate if you need to update your ERP system especially if you are looking for a complete solution.

We recommend an integrated solution within the ERP because it is easier to manage and track rather than having isolated islands of technology that would be required to connect to other software. Once you have decided on this factor, check if the solution is in or out of ERP and if it is able to integrate with your ERP system.

2. Do you prefer an in-house or cloud-based EDI solution?

Setting up EDI in the workplace requires that you have in-house EDI specialists along with the infrastructure to support the implementation. Therefore, this type of publication works with companies that have few business partners and ideal business partners who use the same EDI standards and formats.

In the case of cloud-based EDI, the process takes place over an external network. This type of EDI setup works for companies that do not have EDI expertise or in-house resources to manage EDI transactions, organizations that have many business partner connections in different formats and standards and also for businesses looking for more scalability.

Once you’ve decided, you need to check out the list of EDI providers on how their solution works and whether it’s right for you. Whichever path you choose, ensure that the solution is able to integrate with your existing and future infrastructure.

3. Which pricing model is best for you?

Pricing is usually the deciding factor for most companies. Most EDI providers offer three pricing models such as pay-as-you-go, monthly or yearly. If you decide to use an in-house solution, most EDI providers charge you an annual fee. However, if you decide to go the VAN Provider route that offers everything from EDI mapping to translation, you have to pay per transaction.

When you discuss pricing with your EDI provider, check for any hidden or additional fees such as character limits, free VAN service, EDI mapping, or record lengths. If you are dealing with large amounts of data exchange, it may be best to take a look at the all-in-one packages.

Therefore, to narrow down the price range, you first need to evaluate the volume of your data exchange. This way you can determine the most suitable pricing model for your business scenario.

4. Does the EDI provide a secure platform?

Security is a growing concern as cyber attacks can disrupt business stability and lead to losses. Therefore, it is important to ensure that your EDI provider has a secure platform where you will exchange important documents with business partners using EDI. Also ask for proof of accreditation and certifications.

5. What EDI offers are available with the program?

The legacy EDI technology that required manual entry processing does not work well as the company and business transactions increase. An EDI solution with pre-made maps can facilitate data exchange. For example, an EDI user publishes a packing slip, the system defines the format and the correct EDI message is processed and sent in the background to the correct business partner.

As a best practice, check with your business partners about the type of formats used. Then you can check with your EDI provider about the different types of formats that are available with their solution. In addition, it is also important to check whether translation services will be provided during import or export for your clients or vendor documents that you receive.

6. How much customer support and downtime do you expect?

If your EDI solution is broken, it may prevent you from receiving or sending important documents, so this becomes an important aspect of the evaluation. For example, you receive a sales order and need to send an agreement but if the customer does not receive a response, it could result in a loss of business. Ensure that your EDI provides for response times to protect your business from disruption, to ensure that you can reduce SLA fines and penalties.

You probably have an idea of ​​what downtime would be convenient for you to manage. But you need to check the type of backup and operations that the EDI solution provides in such a case. Also, indicate if any kind of support is expected from your teams during the downtime.

Another important thing to consider is round the clock support to ensure business continuity, especially if you have global operations operating in different time zones. Also, this means that you will need EDI translation services if there are different formats in use in different areas within the organization.

7. Is the EDI vendor focused on customers? Is the solution easy to use?

While reviewing an EDI provider for a demo, also check out the available resources and their processes to address issues and concerns during and after implementation. If you think you need certain customizations, check if this is possible with your EDI vendor.

EDI mapping and data management should be easy in an automated and streamlined platform so that you don’t have to spend any time sorting data manually. It should be easy for you to add business partners and use the solution. For example, our customers often share their feedback about the tutorials included in an EDI solution, as it makes the enrollment process easy.

8. Does your EDI provider have relevant experience in your field?

EDI manages to significantly simplify communications for various industries, thanks to the existing standard formats. Standard formats differ in the automotive industry, for example, compared to food or retail. An EDI provider who already has experience in your field will understand the format and have existing connections to your business partners in your industry circle.

9. Could the range of EDI solutions expand as you grow?

A good EDI solution should be able to allow you to easily extend or increase the number of business relationships in EDI such as customers, vendors or warehouses. Therefore, if you decide to expand your business, the solution must be able to handle the changes. Additionally, when implementing the solution, an EDI provider that provides a quick setup process for all vendors and customers can help you get started with EDI quickly.

10. Do you need any additional services?

What does an EDI provider offer besides an EDI solution? For example, is integration with ERP, data mapping, and EDI translation included if needed? Having to go to multiple vendors for an EDI can be time consuming and frustrating for you.

As your business expands, if you decide that you need an additional service like Master data management For example, in the future, can an EDI service provider help you with that, and can the software easily integrate with those additional solutions?

The last step in checking any EDI partner

The most important step after considering the top 10 factors is to check references to previous implementations. Once you learn about other companies and their experiences and challenges, it can be easier to make a decision. After all, a well implemented EDI solution can help you reap many benefits such as improved processing time, cost savings, and exponential growth.

Our recommendations

in a for heightwe highly recommend executing a file Integrated solution As an EDI software integrated with your ERP system it can really help you in facilitating business communications. Implementing an integrated EDI solution can help you reduce costs while improving the speed of data exchange and the overall accuracy of your data.

An embedded solution built within Dynamics 365 ERP, such as EDI . studio It has advantages over a standalone integrated EDI solution. The embedded solution gives you a comprehensive view of all your EDI transactions, automates the entire EDI process and simplifies troubleshooting. In addition, the inclusion in the ERP system means that there is no need to log out of the ERP system. If you are currently using Microsoft Dynamics 365 or are considering migrating to ERP, we recommend reading as the next step our blog Explain the benefits of investing in an embedded solution and download our infographic here.

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