How to Choose an EDI Provider: Ensuring Compatibility & Efficiency

How to Choose an EDI Provider: Ensuring Compatibility & Efficiency

If you’re an omnichannel brand or a DTC brand who’s ready to take that leap to selling in retail channels, we salute you! There’s just about a million things your team has to contend with. 

Chief among those daily commerce headaches is likely the individual requirements of each of your retail partners when it comes to B2B transactions. Keeping on top of that can get messy, disorganized, and require tons of hours of manual work for your team.

That’s where Electronic Data Interchange (EDI) comes in to change the game. EDI facilitates the electronic exchange of business documents and data across various platforms, making it the backbone for retail, manufacturing, and other sectors.

Working with an EDI provider, or EDI software platform, is the way to go for brands who want to streamline their processes, move toward operational excellence and automate some of the heavy lifting for their team. 

Because let's face it, Target EDI will look very different from Walmart EDI, and that will look different from Amazon and Costco EDI… And that makes for a mountain to climb for your team.

So, let’s talk about automating the process and choosing the right electronic data interchange provider for your business.

Here are 8 key questions you should ask when choosing an EDI provider:

  1. Are they familiar with your trading partners’ requirements?
  2. Do they support all fulfillment models relevant to your business?
  3. Do they have experience with your warehouse’s WMS system?
  4. Can they connect to the warehouse automatically?
  5. How long does setup and onboarding take?
  6. Is their pricing monthly, per order, per trading partner, per transaction?
  7. Can they scale with you as you grow?
  8. What kind of customer service do they provide? 

1. EDI Compatibility with Retailer Requirements

Your business doesn’t operate in isolation. It’s part of a larger ecosystem that includes your trading partners (in EDI terminology, retailers). Are the potential EDI providers familiar with your retailers’ requirements? 

Each trading partner has its own set of rules and requirements for EDI transactions. This can become particularly complex if you’re new to selling at big box retailers. Your chosen provider must be well-versed in these to facilitate smooth and error-free exchanges.

2. EDI & Fulfillment Models

If you’re an omnichannel brand, you’re dealing with various channels that may all have different fulfillment models. Can the EDI provider support all your fulfillment needs in one solution?

Consider all the fulfillment models that are relevant to your business (or might be relevant in the near future as you open up more channels):

  • Wholesale
  • Dropship
  • Direct-to-store
  • In-store fulfillment
  • Ship-from-store
  • Third-party Logistics
  • Cross-docking
  • Micro-fulfillment Centers

The right EDI partner will have the flexibility you need to streamline your fulfillment and alleviate the manual work of managing data and documents for each of your channels and processes.

3. EDI Integration with Your Warehouse Management System (WMS)

Your warehouse is the heart of your logistics and fulfillment operations. Can the EDI provider seamlessly integrate with your WMS system? 

A provider familiar with your warehouse’s WMS can drastically reduce errors, improve efficiency, and automate processes such as inventory management, order fulfillment, and shipping.

It’s also critically important that your EDI provider is able to generate essentials like GS1-128 shipping labels and packing slips.

4. Automatic Connectivity for Omnichannel Systems

In today’s fast-paced market, speed and automation are key. This is especially true for omnichannel brands who have tons of moving parts and multiple channels to manage. Can the EDI provider automatically connect to your key systems? 

Key systems to consider for EDI integration:

  • Ecommerce platform
  • Long-tail B2B marketplaces
  • Order management tools
  • Accounting/ERP
  • Inventory management
  • Warehouse Management System (WMS)
  • Analytics

If you want a deeper dive into these, check out our blog on building an omnichannel tech stack. But the moral here is automatic connectivity to your key tools and systems ensures real-time data exchange, reducing the manual work needed and minimizing the chances of errors.

This is particularly important to consider if you’re working with a 3PL warehouse; you’ll have two 3rd-party entities to consider for your EDI.

5. EDI Setup and Onboarding Duration

Time is a critical factor in business operations. How long does the setup and onboarding process take with the EDI provider? 

Remember, setting up and testing each trading partner relationship individually can be time-consuming. A provider with a streamlined setup process can significantly reduce downtime and get your operations running smoothly quicker.

6. Transparent and Flexible Pricing for EDI

Understanding the pricing structure of an EDI provider is crucial. Is their pricing model based on monthly fees, per order, per trading partner, or per transaction? 

Distinguishing between transactions and orders is vital as a single order can involve multiple transactions (documents). This is often 3-8 transactions, so having a clear and flexible pricing model will help you manage costs more effectively.

7. EDI Scalability

As your business grows, your EDI needs will evolve. Can the EDI provider scale with you? 

A provider that can accommodate growth without significant changes or disruptions ensures long-term partnership and stability.

8. EDI Customer Service and Support

Lastly, consider the level of customer support offered. What kind of customer service does the provider offer? 

Whether it’s direct contact via email, Slack, or phone, or a ticketing system, knowing you can get timely help when needed is reassuring. Assess the provider’s responsiveness, support hours, and the quality of assistance provided.

Work with an EDI Partner or choose an EDI Software Solution?

Why not both? Why not have the option to implement a solution via a SaaS platform that provides guided setup and support for your entire journey?

That’s what you get with Crstl. It’s a no-code EDI solution that makes it easy for your team to implement with guided onboarding. Legacy EDI and API-only solutions lack the flexibility that your team needs, and Crstl alleviates this by doing the heavy lifting and guaranteeing compliance with your trading partners.

If you want to learn more, the best way is a quick, no-commitment demo with our team!

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Bonus Section: How to Choose an EDI Provider FAQ

If you have a specific question about how to choose an EDI provider, you’re not alone! That’s why we’ve compiled a list of frequently asked questions that we run into on discovery calls and see on LinkedIn conversation threads about getting started with EDI!

Here are your frequently asked questions about choosing an EDI provider:

Why is it important to choose the right EDI provider?

The right EDI provider ensures seamless communication between your business and its partners, supports your operational needs, scales with your growth, and helps maintain compliance with industry standards and regulations. Choosing poorly can lead to integration issues, increased costs, and operational inefficiencies.

How do I know if an EDI provider is familiar with my retailer's or trading partner's requirements?

Ask potential providers for case studies, references, or testimonials from companies in your industry or those with similar trading partners. A reputable provider should understand the specific requirements and standards of your industry and trading partners.

Can EDI software integrate with any WMS system?

While many EDI solutions are designed to be versatile, not all can integrate seamlessly with every Warehouse Management System (WMS). It's essential to discuss your specific WMS requirements with potential providers to ensure compatibility and understand the integration process.

What should I consider regarding the setup and onboarding process?

Consider the complexity of your EDI needs, the number of trading partners, and the provider's experience with similar setups. Ask about the expected timeline for completion, support during the process, and training for your team. A provider that offers a clear, efficient onboarding process can significantly reduce implementation stress.

How does EDI provider pricing work?

Pricing structures vary widely among providers and can include monthly subscriptions, per-transaction fees, fees per trading partner, or a combination of these. Understand the details of what each fee covers, and ask about potential additional costs, such as setup fees or charges for extra transactions.

How do I assess if an EDI provider can scale with my business?

Look for providers that have a track record of supporting growth and can offer flexible solutions that adapt to increasing volumes of transactions or expanding business needs. Discuss your growth plans and ask how they can accommodate those plans.

What type of customer support should I expect from an EDI provider?

Effective customer support can vary from direct contact methods like email, phone, or messaging platforms to ticketing systems with guaranteed response times. The quality of support is as important as the method; ensure that the provider offers timely and knowledgeable assistance.

Are there any industry-specific considerations when choosing an EDI provider?

Yes, certain industries have unique standards, regulations, and practices for EDI. Providers with experience in your industry will be better equipped to meet these specific needs and ensure compliance.

How do I start the process of selecting an EDI provider?

Begin by assessing your current and future EDI needs, including trading partner requirements, integration capabilities, scalability, and support needs. Then, research providers, ask for detailed information and demos, and consider feedback from their current or past clients.