# What Is EDI? How Electronic Data Interchange Works and When Your Business Needs It

> What is EDI and how does it work? Learn EDIFACT and X12 messages, AS2 and SFTP, how EDI differs from APIs and e-invoicing, and a 7-step adoption plan.

Source: https://digitalbridge.com.tr/en/blog/what-is-edi.html
Publisher: Digital Bridge Teknoloji (https://digitalbridge.com.tr)
Topic: Software Development
Published: 2026-09-30 · Updated: 2026-10-28

EDI (Electronic Data Interchange) is the automated exchange of business documents such as purchase orders, despatch advices and invoices between companies' systems in an agreed standard format, with no retyping. Instead of someone keying an emailed order into your [ERP](https://digitalbridge.com.tr/en/glossary.html#erp) (enterprise resource planning system), your customer's system sends it straight to yours; the confirmation, shipping notice and invoice travel back the same way.

## Key takeaways

- EDI moves business documents such as orders, shipping notices and invoices between companies' systems in a standard format, without manual keying.
- UN/EDIFACT dominates in Europe and Türkiye and ANSI X12 in North America; messages usually travel over AS2, SFTP, OFTP2 or a VAN.
- EDI does not replace e-invoicing: the e-invoice is the statutory bill, while EDI covers orders, confirmations and shipping notices.
- According to TÜİK, the share of Turkish enterprises selling via the internet or EDI reached 17.1% in 2025, and 29.7% among firms with 250+ staff.
- The real effort in an EDI project is mapping customer codes to your ERP codes and monitoring failed messages, not the connection itself.

## Which sectors and businesses need EDI?

EDI is common wherever large buyers deal with many suppliers: retail and FMCG, automotive, logistics and foreign trade, and pharmaceutical and medical distribution. In most manufacturers, wholesalers and distributors, the starting picture looks familiar. A large customer emails its order as a PDF or spreadsheet, someone in sales support types each line into the ERP, and the confirmation goes back by email. At shipping time, the same details are entered again: on the delivery note, on the labels and in the customer's supplier portal.

Manual order entry works while you have a handful of customers ordering now and then. As accounts grow, two things happen: order frequency climbs, and one day a customer writes, "From next quarter, we'll send orders via EDI." That sentence is rarely a polite request. It is usually a condition of staying on the approved supplier list.

With manual entry, the workload is only half the problem. Every line copied by hand is a chance for a typo, a delay or a missed revision. We cover disconnected systems in general in our [guide to API integration](https://digitalbridge.com.tr/en/blog/api-integration-explained.html); EDI is the same problem between companies, solved with a shared, standardised language.

## What is EDI and how does it work?

It helps to think of EDI in three layers: the **document**, the **format** and the **transport**. The document is the business event: an order, an order response, a shipping notice, an invoice. The format is how that document is written so a machine can read it, and the transport is how the file gets safely from one company to the other.

A typical flow runs like this. Your customer's ERP raises a purchase order, a translator converts it into a standard EDI message, and the message is sent over the agreed channel. On your side, the translator reads the message, maps each field to your own customer, item and price codes, and creates the sales order; an automatic acknowledgement goes back and nobody opens a PDF.

In EDI, that mapping step is where most of the effort in any EDI project goes. Your customer's part number rarely matches your stock code, and their units of measure rarely match yours. This is why EDI struggles without a clean [master data management](https://digitalbridge.com.tr/en/blog/master-data-management-guide.html) discipline behind it.

### The common standards and messages

Two families dominate. **UN/EDIFACT** (United Nations Electronic Data Interchange for Administration, Commerce and Transport), maintained under the United Nations, is the norm across Europe and Türkiye, while **ANSI X12**, accredited by the American National Standards Institute, dominates North America. Alongside them sit XML-based formats and industry subsets such as VDA in automotive or GS1 EANCOM in retail.

| Business document | EDIFACT message | X12 equivalent | Direction |
|---|---|---|---|
| Purchase order | ORDERS | 850 | Customer → supplier |
| Order response | ORDRSP | 855 | Supplier → customer |
| Despatch advice (ASN, advance shipping notice) | DESADV | 856 | Supplier → customer |
| Invoice | INVOIC | 810 | Supplier → customer |
| Delivery schedule | DELFOR | 830 | Customer → supplier |
| Stock and sales report | INVRPT / SLSRPT | 846 / 852 | Retailer → supplier |

On the transport side, the usual options are **AS2** (Applicability Statement 2: encrypted, signed delivery over the internet with a receipt), **SFTP** (SSH File Transfer Protocol), **OFTP2** (Odette File Transfer Protocol 2) in European automotive, and **VANs**, the value-added networks that deliver messages on your behalf. In practice, your largest trading partner usually decides which one you use.

## What is the difference between EDI, APIs, e-invoicing and supplier portals?

"Isn't EDI old technology? Won't an API do?" is a fair question. The short answer is that they do different jobs. An [API](https://digitalbridge.com.tr/en/glossary.html#api) (application programming interface) works in real time, request and response, and is normally designed around one software vendor's rules; EDI is a batch, document-based business language shared by a large community of companies.

| Criterion | EDI | API | Turkish e-Invoice (UBL-TR) | Supplier portal |
|---|---|---|---|---|
| Purpose | Business documents between firms | Live data between systems | Tax-compliant invoice | Entering data on the customer's screen |
| Standard | EDIFACT, X12, industry subsets | Vendor-specific (REST, JSON) | Set by the Revenue Administration | Customer-specific |
| Automation | Full, system to system | Full, system to system | Full via an integrator or direct link; manual on the portal | Low, manual entry |
| Who decides? | Usually the large customer | The software vendor | The tax authority | The customer |
| Typical use | Orders, ASNs, schedules | Stock, prices, parcel tracking | Statutory invoices | Low-volume suppliers |

Türkiye adds a local twist that often blurs EDI and e-invoicing. For taxpayers within the scope set by the Revenue Administration (GİB), domestic invoices and delivery notes already have to be issued electronically in a structured format, handled through [e-invoice integration](https://digitalbridge.com.tr/en/blog/e-invoice-integration-turkey.html) and the [e-Waybill scheme](https://digitalbridge.com.tr/en/blog/e-waybill-turkey-guide.html). EDI covers what sits before and around those statutory documents: the order, the confirmation, the schedule, the shipping notice and a foreign customer's own invoice message.

## What does staying manual cost?

As of 2026, selling through electronic channels is spreading fast in Türkiye. According to [TÜİK's 2026 ICT Usage in Enterprises survey](https://veriportali.tuik.gov.tr/tr/press/58021), the share of enterprises selling via the internet or EDI rose from 13.6% in 2024 to 17.1% in 2025. Among firms with 250 or more employees, it reached 29.7%. The indicator includes web sales, so it does not measure EDI alone, but it does show order traffic shifting to electronic channels.

The tax side shows that structured document exchange is already mainstream:

> According to the [Revenue Administration's 2025 Annual Report](https://cdn.gib.gov.tr/api/gibportal-file/file/getFileResources?objectKey=arsiv/fileadmin/faaliyetraporlari/2025/2025_faaliyet_raporu.pdf), at the end of 2025 some 1,848,492 taxpayers issued e-invoices through private integrators and 86,828 through the GİB Portal, while only 1,988 had connected their own systems directly to GİB.

There is a useful lesson in the GİB e-invoicing split: the vast majority of firms hand the outside connection to an intermediary rather than build it themselves, and EDI is usually no different. The real work lies in wiring that intermediary cleanly into your ERP.

Standards keep moving, too. According to [VDA's publication page for "VDA 4987 – Despatch Advice with EDI V3.1"](https://www.vda.de/en/news/publications/publication/vda-4987---despatch-advice-with-edi-v3.1-2023-06--replaces-vda-4913-), version 3.1 of the EDIFACT DESADV-based despatch advice recommendation was published on 18 July 2023 and replaces the legacy VDA 4913 message. A supplier still working by hand or with old flat files has little time to adapt once a customer makes the switch mandatory; our [automotive EDI integration guide](https://digitalbridge.com.tr/en/blog/automotive-edi-integration.html) covers that sector in depth.

The hidden costs of working without EDI are scattered: staff hours spent keying orders, wrong shipments caused by a miscoded line, revisions spotted too late and a slipping score on the customer's supplier scorecard. None arrives as a single bill, but all of them come out of margin.

## How do you adopt EDI? A 7-step framework

Whatever your sector, a sound EDI project follows roughly this order:

1. **List your partners and messages.** Which customer or supplier wants which document, in which standard and version, over which channel? Collect each partner's implementation guide.
2. **Choose a transport model.** Will you run your own AS2 or SFTP connection, or use a VAN or managed EDI provider? The number of partners and your in-house capacity drive the decision.
3. **Clean your master data.** Customer part numbers mapped to stock codes, units, delivery locations (GLNs, Global Location Numbers) and tax IDs should live in one table. Dirty data turns EDI into an automatic error generator.
4. **Write the mapping and business rules.** Document the ERP target of every message field, the mandatory fields and the exceptions: missing price, unknown item, partial shipment.
5. **Pilot with one partner.** Start with your highest-volume or most demanding partner, test end to end with real messages and get their sign-off.
6. **Build monitoring and an error queue.** Every rejected, unmapped or unacknowledged message must land on someone's screen. An order that silently disappears is more dangerous than one typed in by hand.
7. **Roll out and secure it.** Add partners from the same template, and track certificate renewals, access rights and partners' security expectations with the same rigour as a [third-party security assessment](https://digitalbridge.com.tr/en/blog/third-party-vendor-security-assessment.html).

### Are you ready for EDI? A quick checklist

| Question | If yes | If no |
|---|---|---|
| Are item and customer codes unique in your ERP? | Move on to mapping | Clean the data first |
| Has the customer shared its implementation guide? | Confirm message scope | Ask for it |
| Can your ERP accept orders from an external system? | Integrate directly | Middleware or an [ERP review](https://digitalbridge.com.tr/en/blog/erp-for-smes.html) |
| Is shipping done with barcode scanning? | ASNs can be generated automatically | A [warehouse management system](https://digitalbridge.com.tr/en/blog/warehouse-management-system-guide.html) comes into play |
| Is someone named to watch error messages? | Go live | Assign ownership first |

## How Digital Bridge delivers EDI integration

We don't sell off-the-shelf packages; every EDI engagement starts with discovery and a needs analysis. In the first sessions we map your trading partners, their implementation guides, your ERP's ability to accept external data and the screens an order passes through today. The outcome is a written proposal setting out scope, phases and fees.

On the technical side, we build the bridge between the EDI translator and your ERP as part of our [API integration service](https://digitalbridge.com.tr/en/software-solutions/api-integration.html). If your ERP cannot take external orders directly, our [system integration](https://digitalbridge.com.tr/en/technology-hardware/system-integrations.html) team designs the middleware, message queue and error screen. Where the ERP itself lacks order, pricing or shipping fields, our [ERP development work](https://digitalbridge.com.tr/en/software-solutions/erp-enterprise-resource-planning.html) fills the gap.

Our aim is for every order to land in one order structure in your ERP, whichever channel it came through. Smaller customers who will never run EDI can order through a [B2B e-commerce and dealer portal](https://digitalbridge.com.tr/en/software-solutions/e-commerce-b2b.html) connected to the same ERP flow, so orders from EDI and the portal are tracked on the same screen; the design behind that is explained in our [B2B e-commerce ERP integration](https://digitalbridge.com.tr/en/blog/b2b-ecommerce-erp-integration.html) article.

For logistics and trading firms, EDI is also part of the container and paperwork chain, which we cover in [port logistics document digitalisation](https://digitalbridge.com.tr/en/blog/port-logistics-document-digitalization.html).

Whether to buy a packaged EDI tool or build a tailored integration is a judgement we weigh using the criteria in our [custom vs off-the-shelf software](https://digitalbridge.com.tr/en/blog/custom-vs-off-the-shelf-software.html) guide. For more on this topic, browse our [software development guides](https://digitalbridge.com.tr/en/blog/topic/yazilim.html).

## Next step: pin down your EDI requirements

If a customer has asked for EDI, or order entry is eating your team's week, the right first move is a partner and message inventory. Share your customer's implementation guide and the name of your ERP, and we'll work out together what can connect directly and what needs middleware.

Get in touch through our [contact page](https://digitalbridge.com.tr/en/contact.html), on 0850 346 41 09, or at info@digitalbridge.com.tr.

## Frequently Asked Questions

### Is EDI the same as e-invoicing?

No. In Türkiye, an e-invoice is a tax-valid invoice issued in the UBL-TR format defined by the Revenue Administration, and similar mandated schemes exist in other countries. EDI is the broader exchange of business messages such as orders, confirmations, shipping notices and invoices between companies, using international standards like EDIFACT or X12. The two work together: the order can arrive via EDI while the statutory invoice is issued as an e-invoice.

### Does a small business ever need EDI?

It can. The need for EDI usually comes from a customer's requirement rather than from company size. A small manufacturer supplying a large retailer, a car maker or an overseas distributor may be asked to receive orders via EDI. In that situation, using a managed EDI provider and building only the ERP connection is often a more sensible starting point than running the whole infrastructure in-house.

### Should I choose EDI or an API?

Your trading partner usually decides. If a customer requires EDIFACT or X12 messages, you need EDI; marketplaces, carriers and payment platforms, on the other hand, tend to offer APIs. Many businesses run both side by side: EDI with large customers, APIs with digital channels and internal systems. What matters is that data from both routes ends up in the same order structure in your ERP.

### Where do EDI projects usually struggle?

The hardest part is rarely the technical connection; it is data mapping. Each customer's part numbers, units, delivery locations and pricing logic must be matched to their equivalents in your ERP. If master data is messy, every message produces an error. The second challenge is noticing rejected or unmapped messages, which is why monitoring and error alerts should be designed at the start, not bolted on later.

### What does EDI integration cost, and what drives the price?

There is no single licence fee; the scope of the project sets the cost. The main drivers are the number of trading partners and message types, whether you run your own AS2 connection or use a managed EDI provider, how readily your ERP accepts external orders, how clean your master data is and how much error monitoring you need. A reliable quote therefore follows a partner and message inventory.

### What is the difference between AS2, SFTP and a VAN?

All three move EDI messages from one company to another. AS2 sends encrypted, digitally signed files over the internet and returns a receipt confirming delivery. SFTP is secure file transfer, with confirmation agreed separately between the parties, while a VAN is a service provider network that delivers messages on your behalf, keeps logs and translates between protocols. In most cases, the larger trading partner decides which method is used.