What is EDI compliance?

EDI compliance, sometimes called electronic data interchange (EDI), is a process that ensures organizations are upgrading to the latest versions of EDI standards.

The EDI enables the two parties to communicate through a computer-to-computer transmission, which eliminates the need for paper documents to be sent back and forth, saving both money and time.

However, despite its benefits, EDI compliance can be difficult to achieve if not done correctly.

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If an organization does not comply with the latest versions of EDI standards, it will be unable to successfully exchange data electronically with other organizations.

Not only is this bad for business, but it could also lead to legal ramifications.

How do you become EDI compliant?

In order to become EDI compliant, there are many steps that must be taken.

EDI stands for a vendor-supplier arrangement where a supplier sends a file containing purchase order information electronically to a vendor who then processes the data and returns an approval or rejection of the purchase order electronically.

To start, business owners have to identify their company’s needs, or what is considered “buy-side” or “sell-side”.

This will help determine which compliance standard is right for them.

In order to stay competitive, business owners have been spending millions of dollars to upgrade their systems, purchase new software, and retrain employees.

The sheer number of companies now taking those steps is unprecedented, with a projected 50% of American businesses adopting EDI by the end of 2020.

Why do businesses need to be EDI compliant?

The use of EDI has become so widespread in the business world that it is now necessary for companies to be compliant with this system.

It is becoming more and more difficult for companies that are not because there are many businesses that do not offer services if they are not compliant.

This compliance can help greatly with an organization’s efficiency and reliability.

Unless you speak to a merchant who is not EDI Compliant, the phrase may be unfamiliar.

“EDI” stands for Electronic Data Interchange and it is a technology that has been around for decades.

An EDI-compliant company is able to accept business transactions by means of data transfer from another system or device.


In conclusion, EDI compliance is necessary to successfully participate in today’s global markets.

To ensure that your business is compliant, you should start by understanding the various data formats and how they apply to your business.

EDI Compliance refers to your ability to exchange electronic documents with trading partners without violating antitrust laws.

Data formats are the ways in which information may be exchanged electronically. There are four common formats: EDIFACT, XML, ASCII, and binary.

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