EDI by Industry: Manufacturing, Logistics, and Retail

Electronic Data Interchange (EDI) is the technology that underpins modern B2B trading communication. Despite the technology being around for some 50 years, 70% of B2B transactions are still handled by EDI. And the market continues to grow by over 11% per year.

But here's the thing: while EDI offers a universal framework for B2B communication, it’s still flexible enough to accommodate different requirements—and workflows often vary by industry.

In fact, the way businesses leverage EDI can look quite different from one sector to the next.

In the following sections, we'll explore how EDI is tailored to meet specific needs and overcome the unique challenges of manufacturing, logistics, and retail industries.

EDI in Manufacturing: Companies That Make

The manufacturing sector was one of the early adopters of EDI technology, driven by the need to streamline complex supply chains and support just-in-time (JIT) production methods.

This is an industry where supply chain costs eat into profits by about 13%, so strategies like using EDI to streamline processes are welcome.

From raw material procurement to final product delivery, EDI helps ensure that information flows smoothly, allowing manufacturers to respond to changes in demand while maintaining precision.

Manufacturing-Specific EDI Considerations

Here are three manufacturing-specific EDI considerations, though this will vary widely from business to business:

1. Engineering Change Orders: In industries with complex products, EDI needs to support the communication of engineering changes. This might involve custom transaction sets or specific uses of the EDI 830 Planning Schedule or EDI 862 Shipping Schedule.
2. Quality Control Integration: Many manufacturers integrate EDI with their quality control systems. For example, an EDI 856 Advanced Shipping Notice might include detailed quality data that can be automatically checked against specifications upon receipt.
3. Multi-Tier Supply Chain Communication: In some supply chains, EDI often needs to support communication across multiple tiers of suppliers. For example, a change in the OEM's production schedule might need to cascade through several levels of stakeholders.

Crucial ANSI X12 Transaction Sets for Manufacturing

Several important transaction sets are often used in manufacturing, primarily relating to product planning and shipping. Two key examples include:

EDI 830 Planning Schedule with Release Capability

This transaction set is the lifeblood of many manufacturing operations, especially in industries that rely on JIT production. It allows manufacturers to communicate detailed production schedules to their suppliers, including:

• Firm planned orders
• Forecasted orders
• Cumulative quantities
• Engineering changes

EDI 862 Shipping Schedule

While similar to the 830, the 862 is more immediate and specific. It's often used for short-term planning and can trigger JIT deliveries. Key components include:

• Specific part numbers
• Quantities needed
• Delivery dates and times

EDI in Logistics: Companies That Move

The logistics industry faces unique challenges that make EDI particularly valuable.

These include the need for real-time tracking of shipments, coordination between multiple parties (shippers, carriers, customs, receivers), and the management of complex documentation for international trade.

There are many EDI transaction sets designed specifically to handle these processes and workflows.

Logistics-Specific EDI Considerations

Key factors to consider when implementing EDI in logistics include:

1. Customs and International Trade: For international shipments, EDI needs to support customs documentation and compliance. This might involve specific transaction sets for customs declarations, in line with data privacy laws like GDPR.
2. Real-Time Tracking Integration: Many logistics providers integrate EDI with GPS and other real-time tracking technologies. This allows for more accurate and timely status updates.
3. Capacity Planning: Large logistics providers often use EDI data to optimize their network capacity.

Crucial ANSI X12 Transaction Sets for Logistics

Logistics EDI is unique, with numerous transaction sets covering different logistical processes and workflows. Here are four key examples:

EDI 204 Motor Carrier Load Tender

This transaction set is used by shippers or third-party logistics providers (3PLs) to offer a shipment to a carrier. It includes:

• Pick-up and delivery locations and times
• A detailed description of the freight
• Special handling instructions

EDI 214 Transportation Carrier Shipment Status Message

This message provides real-time updates on the status of a shipment. It can include:

• Current location of the shipment
• Estimated time of arrival
• Any delays or issues encountered

210 Motor Carrier Freight Details and Invoice

This freight bill and invoice combination is commonly used in the trucking industry. It typically includes:

• Detailed breakdown of charges (base rate, fuel surcharge, etc.)
• Description of the freight moved
• Pick-up and delivery information

EDI 315 Status Details (Ocean)

While not as commonly used as some other transaction sets, the EDI 315 is crucial for international ocean freight logistics. It provides:

• Vessel information
• Container status updates
• Estimated and actual arrival times at various ports

EDI in Retail: Companies that Sell

Retail was one of the earliest adopters of EDI technology, driven by the need to manage vast networks of suppliers, distribution centers, and stores.

Today, EDI is deeply embedded in retail operations, facilitating everything from inventory management and order processing to financial transactions and sales reporting.

Major retailers such as Amazon, Walmart, and Target require businesses that trade with them to follow their own EDI rules. These rules contain specific requirements like responding to messages within certain timeframes.

Retail-Specific EDI Considerations

When implementing EDI in the logistics sector, three critical aspects deserve special attention:

1. Omnichannel Integration: Modern retailers need to manage inventory and orders across multiple channels (in-store, online, mobile, etc.) EDI implementation needs to support this omnichannel approach, potentially involving custom uses of transaction sets to communicate channel-specific information.
2. Drop Shipping: Many retailers use drop shipping, where products are shipped directly from the supplier to the customer. This requires specific EDI processes to help ensure smooth communication between all parties involved.
3. Seasonal and Promotional Planning: EDI needs to support complex seasonal demand forecasts and promotional planning, potentially through transaction sets like the EDI 830 Planning Schedule.

Crucial ANSI X12 Transaction Sets for Retail

One transaction set frequently used in retail is the EDI 880 Grocery Products Invoice.

This specialized invoice is used in the grocery industry and can handle complex pricing scenarios, including:

• Promotional discounts
• Volume-based pricing
• Perishable item adjustments

Flexible EDI Solutions For Any Industry

As we've seen, while EDI provides a standardized framework for electronic communication, its implementation and use can vary across different industries and even between individual trading partners.

This inherent flexibility allows EDI to meet the unique needs of various sectors while still providing the benefits of standardized electronic communication.

Whether you're in manufacturing, logistics, or retail, embracing EDI and tailoring it to your industry's unique needs can provide a significant competitive advantage.

As a leading provider of EDI solutions with decades of deep industry experience, Epicor has the expertise and tools to help your business optimize its EDI processes and grow market share.

From intuitive EDI software to expert support, Epicor can be your partner in leveraging EDI's many uses and benefits, no matter what industry you operate in.

Learn more about Epicor EDI solutions.