Three Questions to Consider When Diving into EDI
Companies are usually forced to take on EDI by a trading partner. But, hey, it’s a small price to pay for growth. But before you start, ask yourself these questions to optimize success.
So, you’ve decided to make the jump into EDI.
You may not know much about trading partner compliance or EDI technology because a client has forced the issue, a business process has become too cumbersome, or there is an internal push for lowering costs that has led you to the Internet in search of the best EDI providers.
I’m not going to lie; this is a big step. But you can learn EDI (download our EDI 101 Guide), and here I’ve outline the three biggest issues you must consider before finalizing your EDI project plan.
1. How much volume will you have?
It may be tough to answer this question if this is your first trading partner. However, if you have already established a paper or email relationship then simply add up every document and email exchange that correlates with these business transactions:
- Purchase Order
- PO Acknowledgement
- PO Change
- Ship Notice
- Remittance Advice
If your industry is outside the retail space, you may want to focus on Warehouse Orders, Load Tenders, Health Care Claims and/or Benefit Enrollments.
If you have more than 200 transactions every month, it’s very likely you will need some level of integration or be slowed-down and more vulnerable to risk with data entry work. However, if you have fewer transactions than that, a low-cost, simple web-based solution will suffice.
2. Do you need to integrate with your ERP/TMS/WMS/EMR?
Integration has an up-front cost in connecting your current ERP to your EDI system. Since all ERP systems carry some customization for your specific business needs, integration requires careful planning and architecture. This is true even in cases were an EDI extension package is part of your ERP.
3. What will future growth look like?
You may only need a single connection today, but how many will you need in a month, or even a year?
Will you begin offering drop-ship services when you previously handled mostly stock orders? Or will you be rolling out a website, a new product line or service that relies on EDI to make it profitable?
If that’s the case, you may want to move to an integrated solution right away. It’s a way of ‘future-proofing’ your company’s EDI.
Our EDI experts can help calculate the break-even point and create an EDI launch that will have the greatest organizational impact for the lowest cost.
Need more information on EDI? Download our EDI 101 Guide and EDI Buyer’s Guide to get unbiased EDI know-how to help you maximize your investment in EDI. Also, our experts are here to educate and help through our 45-minute discovery process that helps pin-point the best solution for your business. Contact us today.