How EDI works in the Shipping and Logistics Industry

3 min readOct 1, 2020

Gone are those days when entrepreneurs used to run their business manually. From billing to managing shipping and logistics, everything was done with a pen on papers. But now, with the invasion of technology, things have drastically changed. Businesses are looking for new and smart solutions to automate their operations. And this is where EDI comes into the picture. Entrepreneurs are actively looking for the best EDI service providers in the market who can integrate EDI software into their business. These solutions not only increase the efficiency of the work done but are also helpful in eliminating the possibilities of human error.

Though EDI solutions are now being used in a wide range of industries like retail and e-commerce, the real estate and housing sector, the finance industry, but the shipping and logistics industry is the one which is most benefited by it. The transportation industry has a lot of paperwork to do, and if anything goes missing a lot of trouble has to be faced by the consignment owner. This is the sole reason why businesses have switched to these advanced EDI solutions.

So, before we begin with how EDI works in shipping and logistics, let us know a brief about EDI.

EDI: A Brief History

Electronic Data Interchange EDI as the name suggests refers to the exchange of data, electronically. Going by the technical definition, it is a computer to computer exchange of business documents in the electronic form between partners.

Developed in the 60s, it was first used to transfer documents between two chemical companies. The main purpose of EDI was to speed up the documents transferring process in the shipping and logistics industry. Now the application of EDI is not just limited to the movement of the documents but has expanded to the exchange of invoices and purchase orders to global procurement.

How does EDI work in the Shipping and Logistics Industry?

EDI in the logistics industry has become extremely famous as business owners here are adjusting their frameworks to cook for EDI record trade.

The preferences for those working in the transportation business are that standard high volume interchanges can be computerized permitting dispatchers and records receivables staff more opportunity to zero in on more gainful assignments and give customers better client assistance. One of the fundamental points of EDI is that it disposes of a dispatcher from having to physically enter data into the dispatch operational and charging framework. This outcomes in setting aside time and cash while killing any exorbitant information passage botches. The other favorable position is that businesses who are EDI friendly can convey consistently and electronically with all gatherings in the logistics industry.

Some of the common ways how EDI solutions work:

Computer-to-computer: EDI software eliminated the usage of fax or postal mail. Sending documents physically is always a risk as there may be a chance of misplacing them. By opting for EDI integration services, you can exchange the documents via email, or even from your device’s app to direct the receiver’s device application like Order Management App, so that one does not have to wait for days to receive the documents and also there is no chance of misplacing them.

Business Documents: These are any of the documents that are ordinarily traded between organizations. The most widely recognized documents traded by means of EDI are buying requests, solicitations, and the advance shipment note. Be that as it may, there are many, numerous others, for example, bills of lading, customs documents, stock documents, etc.

Business Partners: The simple documents related to an order, which are transferred between the partners fall under this category. EDI solutions make it really easy for the entrepreneurs to exchange the information, fast and securely.

Integrating EDI software really helps your business especially if you deal with transportation. Handling small orders manually is still easy but when it comes to large consignments, where a lot of paperwork is required, almost all businesses look to integrate smart shipping and logistics solutions that can ease their business operations, and EDI is one of them.




A3logics delivers value-added industry-specific business technology consulting, IT solutions and services to businesses across the globe.