What Is EDI? A Plain-English Guide for Suppliers

Electronic Data Interchange — EDI — is simply the computer-to-computer exchange of business documents in a standardized format. Instead of emailing a purchase order as a PDF or faxing an invoice, EDI lets your systems and your retailer’s systems talk directly to each other.

Why EDI Matters

Every major retailer in the United States requires EDI from their suppliers. Walmart, Target, Amazon, Costco, Home Depot — they all demand that purchase orders, advance ship notices, and invoices arrive in a specific electronic format. Miss a requirement, and you face chargebacks, fines, or worse — a vendor relationship at risk.

The Core EDI Transaction Sets

• EDI 850 – Purchase Order: The retailer sends you a PO.
• EDI 855 – Purchase Order Acknowledgment: You confirm you received it.
• EDI 856 – Advance Ship Notice (ASN): You tell the retailer exactly what’s shipping and when.
• EDI 810 – Invoice: You bill the retailer electronically.
• EDI 997 – Functional Acknowledgment: A technical receipt confirming a document arrived.

How EDI Works in Practice

When a buyer at Target places a purchase order, their system generates an EDI 850 and sends it through a Value-Added Network (VAN) or direct AS2 connection to your EDI system. Your system processes it, generates an 855 acknowledgment, and — when you ship — creates an 856 ASN and an 810 invoice. All without a single phone call or email.

Self-Service vs. Managed EDI

Not every supplier needs to manage EDI internally. Spring Systems offers:

• PortalApp (Web Self-Service): Log in, manage orders, print labels, and send EDI documents through a browser.
• Full Service EDI Bureau: We handle everything — you just focus on fulfillment.
• Integrated Service: Connect your ERP or WMS directly to the EDI network.

EDI doesn’t have to be complicated. With the right partner, it becomes invisible infrastructure that keeps your retail relationships running smoothly.