What Is Electronic Data Interchange?

What Is Electronic Data Interchange?

What is Electronic Data Interchange (EDI)? What considerations should you take around implementing EDI? Should your company implement EDI now, or in the future?

EDI is simply the sending of files/data electronically. Email is a version of EDI that is by far the most pervasive allowing internet users to send files and messages between their friends, fellow employees and companies. These messages can contain attachments such as, word documents, photos, PDFs or scans of invoices, etc. Over the last few years we have seen a steady increase in the number of clients sending us scans, PDFs, excel or CSV files of their respective shipments - in its essence this is a type of EDI.

On the other end of the EDI spectrum is 'true' EDI. True EDI typically involves a minimum of two partners (in some cases a company may have many locations) that agree on a file format (XML files for instance) or 'language' and a method (FTP, direct VPN, Value added network) for transferring data back and forth to the Customs Broker. Conceptually, EDI is a straight forward discussion.

EDI Key Benefits

  • Reduces or eliminates manual data entry errors
  • Streamlines transaction processing
  • Increases productivity without increasing staff

Who Should Use EDI?

  • Companies with complicated entries with high volumes
  • A business that ships many times per week or even many times per day, and has shipments with 100s or 1000s of SKU/Parts/Products per shipment
  • Companies that have access to IT resources to assist with the development of the processes on the client side preparing documents/files for the EDI workflow.

Over my 20 years with Pacific Customs Brokers, I have been involved in a number of EDI implementations, however I have had many more discussions around EDI than I have had implementations. EDI is one of those discussions that sounds great at the conceptual stage and then becomes tricky the further you go down the discussion process. It can get rather complicated very quickly.

EDI Considerations

  • IT resources / effort - typically many companies underestimate this
  • Creating an automated workflow for documents/summary files and parts
  • Controlling / syncing the parts table to Pacific Customs Brokers (Canada)  - EDI clients must provide a means of syncing their parts/SKUs to our rating system allowing EDI entries to be auto-rated in the Pacific Customs Brokers' (Canada) brokerage systems
  • Handling exceptions in the data - a new SKU for instance - how do we handle a part/SKU that we have not seen before
  • Connectivity methods - FTP, VPN, value added services/networks
  • Security and privacy - encrypted files
  • File format and customization - XML, flat file, csv, xls, etc.

For clients of Pacific Customs Brokers, we offer competitive brokerage fees for high volume/complex shipments using EDI. We also provide EDI consulting services through our Professional Services Group. A simple questionnaire will help us evaluate your EDI readiness as well as the suitability of EDI as a solution for your company, from there we can start discussions around implementing EDI.

To receive more information on EDI, please contact our Client Services Team by email, office@pcb.ca, or call us directly at 888.538.1566.

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About the Author
Jeff Bourassa

While we strive for accuracy in all our communications, as the Importer of Record it is incumbent upon your company to ensure that you are aware of the requirements under the new regulations so that you maintain compliance as always.