EDI — Electronic Data Interchange, the complete guide for B2B trade
In short: EDI (Electronic Data Interchange) is the automatic exchange of business documents (purchase orders, dispatch advices, invoices) between two companies' IT systems, in a standardized format, without email or manual re-entry. EDI is a contractual requirement at nearly every major retailer worldwide (Walmart, Kaufland, Carrefour, Lidl, Auchan, Metro, Target) and increasingly runs alongside e-invoicing mandates.
Key capabilities
- Practical definition: EDI = automatic transmission of structured documents (orders, invoices, dispatch advices) directly between ERPs, without email or PDF.
- Standards in use: EDIFACT (dominant in Europe/retail), X12 (dominant in the US), UBL 2.1 (e-invoicing, PEPPOL), ODETTE (automotive).
- Contractual requirement at retailers: Walmart, Kaufland, Carrefour, Lidl, Auchan, Metro, Target, Amazon — virtually all large retailers mandate EDI.
- Complementary to e-invoicing: The invoice goes out simultaneously to the retailer (INVOIC/810) and to tax authorities where e-invoicing is mandatory — one flow, two destinations.
- Integration with 40+ ERPs: SAP, Dynamics 365, NetSuite, Odoo, Sage, and dozens of regional ERPs — native connectors, no custom code.
- Accessible pricing: From €24/month (Web EDI SaaS), with no upfront investment in hardware or perpetual software licenses.
Why EDI became the retail standard worldwide
Over the last decade, virtually every major retailer has migrated to mandatory EDI for suppliers. The reason is simple: at their volumes (thousands of orders daily), manual processing of PDFs and emails is impossible. EDI lets them automate goods receipt (SSCC scanning on the DESADV), three-way matching (order + delivery + invoice), and supplier payments.
For the supplier, EDI is no longer an optional cost — it's a contract requirement. Without compliant EDI (valid INVOIC, DESADV with correct SSCC, timely ORDRSP), suppliers face chargebacks or lose the contract entirely. An EDI subscription of €100-300/month replaces a hidden cost of thousands of euros/month in manual labor and penalties.
EDI and e-invoicing, in a single flow
Across the EU and beyond, tax authorities are progressively mandating structured e-invoicing (UBL 2.1, PEPPOL) for B2B transactions. A modern EDI platform generates two flows simultaneously from the same ERP export: INVOIC/EDIFACT to the retailer (for their accounts payable) and UBL 2.1 to the tax authority (for compliance). One trigger, two destinations, zero extra work.
Frequently asked questions
What is EDI?
EDI (Electronic Data Interchange) is the electronic exchange of structured business documents (purchase orders/ORDERS, dispatch advices/DESADV, invoices/INVOIC) directly between two companies' IT systems, in a standardized machine-readable format, without email, PDF or manual entry.
What does EDI mean in practice for suppliers?
In practice, EDI is dominated by the EDIFACT standard in Europe (Walmart, Kaufland, Carrefour, Lidl, Auchan, Metro all require it) and by X12 in North America, alongside UBL/XML for tax e-invoicing mandates. The two run in parallel, often from a single platform.
Who needs to use EDI?
Any supplier shipping to a large retailer (almost all require EDI as a contract term), any manufacturer exporting into the EU or US retail supply chain, and any company issuing B2B invoices in a jurisdiction with mandatory e-invoicing (a form of EDI).
How much does EDI cost?
Starts at €24/month for Web EDI SaaS (low volume, 10-50 documents/month) and scales up. Managed EDI: €200-500/month. On-premise EDI: €15,000-100,000 upfront investment. For most companies, Web EDI SaaS is the optimal choice.
How long does EDI implementation take?
With a vendor that already has templates for your retailers: 5-10 business days per retailer (setup, mapping, testing, go-live). Without pre-existing templates: 3-8 weeks.
Is EDI legally mandatory?
Not directly for retail trade, but in practice yes — retailers enforce it contractually. For B2B invoicing, e-invoicing mandates (a form of EDI) are becoming legally mandatory across the EU and beyond.