--- title: EDI Archives description: Home > EDI What is Electronic Data Interchange (EDI)? EDI Helps You: Connect with business partners Receive and send information securely Increase the speed of data exchange Standardize document transfer Connect with business partners EDI’s primary function is to transfer documents between business partners with little to no effort on your part. By coordinating your EDI transmissions with other companies and optimizing your business’s EDI compliance, it’s easy to maintain an open line of communication and build trust. Receive and send information securely EDI tools give organizations an easy way to encode and decode sensitive information so it can be transmitted securely — simply set the protocol you want to use and upload the documents. The recipient will receive them and have them decoded through their own EDI software, ensuring only those with access to the software are able to access them. Increase the speed of data exchange By using either point-to-point or third-party networks, EDI software opens up channels that can securely send encoded documents to a business partner within minutes, rather than relying on a physical transmission or an unsecured email. This frees up both sender and receiver to get more done throughout the day. Standardize document transfer EDI software can help your business send important documents to partner organizations in a standardized format, reducing the potential for leaks and ensuring everything gets where it needs to as quickly as possible. Some of the commonly used EDI standards include: ANSI ASC X12 EDIFACT ODETTE SWIFT EANCOM RosettaNet VDA VICS Tradacoms FAQs What is EDI? Electronic data interchange (EDI) is a method of sending and receiving confidential and sensitive documents between organizations. Using this protocol means you don’t have to worry about unsecured emails or potential document leaks. With EDI, simply upload your documents to the software and choose their destination. The software will encode the files and transfer them to the recipient with no further action required on your part. How does EDI work? To use EDI, both the sending and receiving party need to have EDI software installed and an agreed-upon encoding standard. The software uses the selected standard to automatically encrypt the documents the sender uploads, then transfer them through a secured pathway to the recipient’s EDI software. The recipient can then decode the documents and use them as needed from there. What types of information can be exchanged through EDI? Here are some of the commonly shared files that EDI software can help keep secure when sending: Purchase orders Purchase order acknowledgments Invoices Inventory inquiries Shipping notices Warehouse shipping orders Product activity reports Which industries use EDI software? Companies in a variety of industries use EDI to more securely and efficiently share sensitive documents and information with business partners. Here is just a sampling of some of the industries that leverage this technological solution: Financial services Software Manufacturing Distribution Retail Automotives Pharmaceuticals Electronics How do I implement EDI? There are two main methods of implementing EDI — through point-to-point or outsourced integration. Let’s explore a little more about each. Point-to-Point Point-to-point implementation, or in-house deployment, means an organization installs and houses the software on a computer or server that the company owns. This comes with a higher up-front cost and requires dedicated staff to maintain, but it comes with increased peace of mind thanks to the handling of all EDI software operations within the company rather than outsourcing, and often means shorter document transfer times. Outsourced Outsourced implementation means an organization partners with other organizations to handle the EDI software and transfer paths. Implementing this often requires subscribing with a cloud-based service provider, which means you’ll pay a monthly fee rather than a large up-front purchase price. This can reduce costs overall, making it beneficial for smaller businesses, and doesn’t require in-house IT staff to maintain. What is EDI compliance? Taking part in EDI compliance includes factors such as developing your EDI infrastructure, aligning it with the needs of your business partners and deciding what document transfer standards will be. This is a necessary and ongoing process to ensure that your EDI software continues to work as intended and communicate properly with other parties. How do I select an EDI system? When it’s time to choose or upgrade to the right EDI software for your business, you’ll want to consider several important factors. What are your business needs? What implementation method is best for your organization? What document transfer standards are your partners using? SelectHub has several resources to help you navigate the EDI software market and make the process as simple as possible. Our EDI software buyer’s guide can give you a brief refresher on some common EDI features and a few software recommendations, and our comparison report can help you see how software vendors stack up next to each other. If you’re looking for a more personalized touch, we can help with that too! Email us at support@selecthub.com or via phone at 855-850-3850. Read More Resources for Software Selection EDI Software In-Depth Comparison Report EDI Software Requirements Template Accounting & Financial Management ERP Distribution Management Manufacturing Management Product Lifecyle Management Professional Services Automation Most Popular Articles Recent Articles EDI Sotware Recent PostsEDI vs API in the Supply ChainThe 5 Best iPaaS Software Vendors of 2026What Is EDI Integration? How It Boosts Your Business OperationsThe Future of EDI: Market Trends for 2026 and BeyondThe Top 6 EDI Requirements & Features Template See More Confidence Comes from Data EDI software selection is complex and beset with problems for both IT buyers and solution providers. We do three things to make it fast and simple: FREE Software Selection Platform Our platform provides best-practices, including requirements templates & vendor comparisons, to help you make the right decisions for your unique needs, in a fraction of the time. Try it FREE. Start Selecting Software Aggregated Reviews We have collected every software review available online, crunched every last word using our proprietary Sentiment Analysis algorithms, all so we can tell you how a software product is viewed in its marketplace, retrospectively. Get EDI Software Reviews Professional Analysis We relentlessly collect and analyze data about software, then compile and share it so every company has the same access to the information. The information we gain is then used in our Software Selection platform to help you find the right software. See Analyst’s Top EDI Software Picks Your Guides Our industry journalists proudly distill the helpful information you read on SelectHub, always on the mission to share what matters so you can make your best decisions independently. EDI articles are written and edited by: Zachary Totah Content Manager As SelectHub’s Content Manager, Zachary Totah leads a team of more than 35 writers and editors in their quest to provide content that helps software buyers find the right system for their company. Show More Dianna Dragonetti Editor As an editor, Dianna Dragonetti leads a team of five writers in writing about a variety of software, with an emphasis on how these tools empower businesses. Show More Peter Lalush Technical Content Writer With an interest in technology and a master’s in Technical Communication, Peter covers accounting, distribution and EDI software for SelectHub. Show More Thought Leaders SelectHub has sought out and invited thought leaders to contribute to our EDI industry articles and resources. These thought leaders ensure we deliver quality content with the most accurate information, focusing on what matters most. No thought leader is compensated for their contributions, but shares our belief that information should be democratized so everyone can make the best decision. Erik Kiser CEO, Orderful At 25 Erik started a consulting firm focused on writing EDI and B2B integrations for manufacturers. Through scaling the company he realized that there is a great opportunity to improve business for the manufacturers by providing a software hub approach. Show More × Erik Kiser CEO, Orderful At 25 Erik started a consulting firm focused on writing EDI and B2B integrations for manufacturers. Through scaling the company he realized that there is a great opportunity to improve business for the manufacturers by providing a software hub approach. Orderful, Erik's second venture, started a few years later. Orderful has successfully raised funding from prestigious venture capital firms including Andreessen Horowitz, and is on a path to improve B2B and EDI trading for the world. Most Recent Articles --- [Home](https://www.selecthub.com/) \> EDI ![What Is EDI?]() # What is Electronic Data Interchange (EDI)? ## EDI Helps You: * Connect with business partners * Receive and send information securely * Increase the speed of data exchange * Standardize document transfer ### Connect with business partners EDI’s primary function is to transfer documents between business partners with little to no effort on your part. By coordinating your EDI transmissions with other companies and optimizing your business’s [EDI compliance](#edicomp), it’s easy to maintain an open line of communication and build trust. ### Receive and send information securely EDI tools give organizations an easy way to encode and decode sensitive information so it can be transmitted securely — simply set the protocol you want to use and upload the documents. The recipient will receive them and have them decoded through their own EDI software, ensuring only those with access to the software are able to access them. ### Increase the speed of data exchange By using either point-to-point or third-party networks, EDI software opens up channels that can securely send encoded documents to a business partner within minutes, rather than relying on a physical transmission or an unsecured email. This frees up both sender and receiver to get more done throughout the day. ### Standardize document transfer [EDI software](https://www.selecthub.com/c/edi-software/) can help your business send important documents to partner organizations in a standardized format, reducing the potential for leaks and ensuring everything gets where it needs to as quickly as possible. Some of the commonly used EDI standards include: * ANSI ASC X12 * EDIFACT * ODETTE * SWIFT * EANCOM * RosettaNet * VDA * VICS * Tradacoms ## FAQs ### What is EDI? Electronic data interchange (EDI) is a method of sending and receiving confidential and sensitive documents between organizations. Using this protocol means you don’t have to worry about unsecured emails or potential document leaks. With EDI, simply upload your documents to the software and choose their destination. The software will encode the files and transfer them to the recipient with no further action required on your part. ### How does EDI work? To use EDI, both the sending and receiving party need to have EDI software installed and an agreed-upon encoding standard. The software uses the selected standard to automatically encrypt the documents the sender uploads, then transfer them through a secured pathway to the recipient’s EDI software. The recipient can then decode the documents and use them as needed from there. ### What types of information can be exchanged through EDI? Here are some of the commonly shared files that EDI software can help keep secure when sending: * Purchase orders * Purchase order acknowledgments * Invoices * Inventory inquiries * Shipping notices * Warehouse shipping orders * Product activity reports ### Which industries use EDI software? Companies in a variety of industries use EDI to more securely and efficiently share sensitive documents and information with business partners. Here is just a sampling of some of the industries that leverage this technological solution: * Financial services * Software * Manufacturing * Distribution * Retail * Automotives * Pharmaceuticals * Electronics ### How do I implement EDI? There are two main methods of implementing EDI — through point-to-point or outsourced integration. Let’s explore a little more about each. #### Point-to-Point Point-to-point implementation, or in-house deployment, means an organization installs and houses the software on a computer or server that the company owns. This comes with a higher up-front cost and requires dedicated staff to maintain, but it comes with increased peace of mind thanks to the handling of all EDI software operations within the company rather than outsourcing, and often means shorter document transfer times. #### Outsourced Outsourced implementation means an organization partners with other organizations to handle the EDI software and transfer paths. Implementing this often requires subscribing with a cloud-based service provider, which means you’ll pay a monthly fee rather than a large up-front purchase price. This can reduce costs overall, making it beneficial for smaller businesses, and doesn’t require in-house IT staff to maintain. ### What is EDI compliance? Taking part in EDI compliance includes factors such as developing your EDI infrastructure, aligning it with the needs of your business partners and deciding what document transfer standards will be. This is a necessary and ongoing process to ensure that your EDI software continues to work as intended and communicate properly with other parties. ### How do I select an EDI system? When it’s time to choose or upgrade to the right EDI software for your business, you’ll want to consider several important factors. What are your business needs? What implementation method is best for your organization? What document transfer standards are your partners using? SelectHub has several resources to help you navigate the EDI software market and make the process as simple as possible. Our [EDI software buyer’s guide](https://www.selecthub.com/c/edi-software/) can give you a brief refresher on some common EDI features and a few software recommendations, and our [comparison report](https://pmo.selecthub.com/request-custom-scorecard/?category=EDI%20Software) can help you see how software vendors stack up next to each other. If you’re looking for a more personalized touch, we can help with that too! Email us at [support@selecthub.com](mailto:support@selecthub.com) or via phone at [855-850-3850](tel:855-850-3850). Read More ## Resources for Software Selection [EDI Software ](https://www.selecthub.com/c/edi-software/) [In-Depth Comparison Report ](https://pmo.selecthub.com/top-edi-report-site-vers/) [EDI Software Requirements Template ](https://pmo.selecthub.com/edi-requirements-onsite/) [Accounting & Financial Management](https://www.selecthub.com/category/accounting/) [ERP](https://www.selecthub.com/category/enterprise-resource-planning/) [Distribution Management](https://www.selecthub.com/category/distribution/) [Manufacturing Management](https://www.selecthub.com/category/manufacturing/) [Product Lifecyle Management](https://www.selecthub.com/category/plm/) [Professional Services Automation](https://www.selecthub.com/category/professional-services-automation/) ## Most Popular Articles ## Recent Articles EDI Sotware Recent Posts * ### [EDI vs API in the Supply Chain](https://www.selecthub.com/supply-chain-management/edi-and-api-supply-chain/) * ### [The 5 Best iPaaS Software Vendors of 2026](https://www.selecthub.com/electronic-data-interchange/ipaas-features-benefits-top-vendors/) * ### [What Is EDI Integration? How It Boosts Your Business Operations](https://www.selecthub.com/electronic-data-interchange/edi-integration/) * ### [The Future of EDI: Market Trends for 2026 and Beyond](https://www.selecthub.com/electronic-data-interchange/edi-software-trends/) * ### [The Top 6 EDI Requirements & Features Template](https://www.selecthub.com/electronic-data-interchange/edi-requirements/) [See More](#moreArticles) ## Confidence Comes from Data EDI software selection is complex and beset with problems for both IT buyers and solution providers. **We do three things to make it fast and simple:** ### FREE Software Selection Platform Our platform provides best-practices, including requirements templates & vendor comparisons, to help you make the right decisions for your unique needs, in a fraction of the time. Try it FREE. [Start Selecting Software ](https://www.selecthub.com/about/start-free-selection-project-site/) ### Aggregated Reviews We have collected every software review available online, crunched every last word using our proprietary Sentiment Analysis algorithms, all so we can tell you how a software product is viewed in its marketplace, retrospectively. [Get EDI Software Reviews ](https://www.selecthub.com/c/edi-software/) ### Professional Analysis We relentlessly collect and analyze data about software, then compile and share it so every company has the same access to the information. The information we gain is then used in our Software Selection platform to help you find the right software. [See Analyst’s Top EDI Software Picks ](https://www.selecthub.com/c/edi-software/) ## Your Guides Our industry journalists proudly distill the helpful information you read on SelectHub, always on the mission to share what matters so you can make your best decisions independently. EDI articles are written and edited by: [ ](https://www.selecthub.com/author/zachary-totah/) ### Zachary Totah Content Manager As SelectHub’s Content Manager, Zachary Totah leads a team of more than 35 writers and editors in their quest to provide content that helps software buyers find the right system for their company. [ Show More](https://www.selecthub.com/author/zachary-totah/) [ ](https://www.selecthub.com/author/dianna-dragonetti/) ### Dianna Dragonetti Editor As an editor, Dianna Dragonetti leads a team of five writers in writing about a variety of software, with an emphasis on how these tools empower businesses. [ Show More](https://www.selecthub.com/author/dianna-dragonetti/) [ ](https://www.selecthub.com/author/peter-lalush/) ### Peter Lalush Technical Content Writer With an interest in technology and a master’s in Technical Communication, Peter covers accounting, distribution and EDI software for SelectHub. [ Show More](https://www.selecthub.com/author/peter-lalush/) ## Thought Leaders SelectHub has sought out and invited thought leaders to contribute to our EDI industry articles and resources. These thought leaders ensure we deliver quality content with the most accurate information, focusing on what matters most. No thought leader is compensated for their contributions, but shares our belief that information should be democratized so everyone can make the best decision. ![Erik Kiser]() ### Erik Kiser CEO, Orderful At 25 Erik started a consulting firm focused on writing EDI and B2B integrations for manufacturers. Through scaling the company he realized that there is a great opportunity to improve business for the manufacturers by providing a software hub approach. [ Show More](#open-modal-2) [×](#modal-close "Close") ![Erik Kiser]() ### Erik Kiser CEO, Orderful At 25 Erik started a consulting firm focused on writing EDI and B2B integrations for manufacturers. Through scaling the company he realized that there is a great opportunity to improve business for the manufacturers by providing a software hub approach. Orderful, Erik's second venture, started a few years later. Orderful has successfully raised funding from prestigious venture capital firms including Andreessen Horowitz, and is on a path to improve B2B and EDI trading for the world. ## Most Recent Articles [EDI](https://www.selecthub.com/category/electronic-data-interchange/), [Supply Chain Management](https://www.selecthub.com/category/supply-chain-management/) It’s hard to imagine an effective supply chain management solution that doesn’t rely on EDI or API. They both allow you to quickly and securely exchange data from system to system, which is a huge part of the supply chain management process. But even though both API and EDI are widely used across many different business software solutions, they do have their differences. These differences need to be understood in order to make an educated choice when choosing a software solution that best suits your business needs. Kim O'ShaughnessyEDI vs API in the Supply Chain [read more](https://www.selecthub.com/supply-chain-management/edi-and-api-supply-chain/) [EDI](https://www.selecthub.com/category/electronic-data-interchange/) Cloud computing technology’s accessibility and ease of use have turned it into a booming element of the IT industry. But the rise of the cloud, coupled with competing technologies like APIs and [EDI software](https://www.selecthub.com/edi-software/), has brought on new challenges to companies as well. Combining on-premise applications, cloud software solutions, and social platforms makes the integration process much more complicated. This has many companies turning to “integration platform as a service,” or “iPaaS,” vendors. Peter LalushThe 5 Best iPaaS Software Vendors of 2026 [read more](https://www.selecthub.com/electronic-data-interchange/ipaas-features-benefits-top-vendors/) [EDI](https://www.selecthub.com/category/electronic-data-interchange/) B2B communications aren’t a walk in the park. Overflowing spreadsheets, exploding inboxes — if this sounds familiar, you’re not alone. But what if there was a way to ditch manual data entry and turn that email avalanche into a streamlined flow? Enter EDI integrations, your business’s missing piece to simplify data transfer with stakeholders. [EDI systems](https://www.selecthub.com/c/edi-software/) are digital translators that automate business document exchanges between you and your trading partners. But the magic of EDI goes beyond just that, from slashing costs to boosting customer satisfaction. Keep reading to discover how EDI integrations can help your business. Riddhiman RoyWhat Is EDI Integration? How It Boosts Your Business Operations [read more](https://www.selecthub.com/electronic-data-interchange/edi-integration/) [EDI](https://www.selecthub.com/category/electronic-data-interchange/) Despite its widespread use in nearly every business industry, [electronic data interchange software](https://www.selecthub.com/c/edi-software/) (EDI) is often cited by working professionals as a technology that’s soon to be obsolete. However, EDI trends remain steady even in the face of new data exchange tech such as APIs — most prominently, because EDI still gets the job done. Peter LalushThe Future of EDI: Market Trends for 2026 and Beyond [read more](https://www.selecthub.com/electronic-data-interchange/edi-software-trends/) [EDI](https://www.selecthub.com/category/electronic-data-interchange/) [EDI solutions](https://www.selecthub.com/c/edi-software/) are like high-speed bridges connecting businesses, enabling efficient document exchanges, streamlining communications and eliminating traditional data transfer delays. But you need a solid blueprint before you can build your bridge. That’s where an EDI requirements template comes in. Riddhiman RoyThe Top 6 EDI Requirements & Features Template [read more](https://www.selecthub.com/electronic-data-interchange/edi-requirements/) ### EDI Software Sidebar [ **Compare Top EDI Software Leaders** Pricing, Ratings, and Reviews for each Vendor. PLUS… Access to our online selection platform for free. ![EDI Software](https://www.selecthub.com/wp-content/uploads/2021/02/EDI-V1.png) ](https://pmo.selecthub.com/top-edi-report-site-vers/) [ **Requirements Template for EDI Software** Jump-start your selection project with a free, pre-built, customizable EDI Tools requirements template. ](https://pmo.selecthub.com/edi-requirements-onsite/) #### **See the EDI Leaders and Get:** [ EDI Demos](https://www.selecthub.com/c/edi-software/) [ EDI Trends](https://www.selecthub.com/electronic-data-interchange/edi-software-trends/) ```json {"@context":"https:\/\/schema.org","@graph":[{"@type":"CollectionPage","@id":"https:\/\/www.selecthub.com\/category\/electronic-data-interchange\/","url":"https:\/\/www.selecthub.com\/category\/electronic-data-interchange\/","name":"What is Electronic Data Interchange (EDI)? 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