EDI vs API | Definition & Advantages | EDI Basics (2024)

FAQs

EDI vs API | Definition & Advantages | EDI Basics? ›

Understanding the key differences between EDI and API is crucial for businesses looking to optimize their data exchange

While EDI focuses on batch processing and long-term partnerships, APIs emphasize real-time interactions and data monetization. Keep reading to learn how both technologies, EDI and API, can complement each other on a single integration platform such as the SEEBURGER BIS Platform.

Much like EDI for document exchange, APIs streamline communication between businesses by providing a structured interface for software applications to connect and share data. APIs offer businesses a versatile and dynamic means of communication, transcending the limitations of traditional point-to-point integrations.

APIs also support secure communication, but the level of security varies depending on implementation. API security relies on authentication, access controls, and encryption to protect data. The security measures can be more flexible and customizable compared to EDI, but not all APIs are created equal.

EDI is used for exchanging structured business data between trading partners' EDI systems, while APIs are used for integrating and communicating between different software applications for real-time data exchange. The fact is, onboarding in 2024 is quite difficult and cumbersome to achieve.

API stands for Application Programming Interface. In the context of APIs, the word Application refers to any software with a distinct function. Interface can be thought of as a contract of service between two applications. This contract defines how the two communicate with each other using requests and responses.

EDI minimizes the risk of errors caused by manual data entry, illegible handwriting, or misinterpretation of information. The standardized electronic format ensures consistency, leading to more accurate and reliable exchange of business documents, such as invoices, purchase orders, and shipping notices.

The main benefit of integrated EDI is that it removes the need to manually retype data which eliminates costly data entry errors. This saves considerable time and money and improves your customers' experience.

1000s of standard business transaction documents can be sent automatically using EDI. Some common examples include: purchase orders, invoices, shipping statuses, customs information, inventory documents and payment confirmations.

Why is EDI so hard? ›

Some older formats of EDI (EDIFACT or IMP) weren't meant for humans to read and understand them, therefore catching and fixing errors can be challenging. Even when it's possible to read the information, manual error detection is time-consuming and expensive and can still result in errors.

EDI (Electronic Data Interchange) has been around since the 1970s. Today, EDI is still the most used technology for communications between companies. It is highly structured and is accepted as an international standard for exchanging information between trading partners anywhere in the world.

Data is important for EDI. However, the same data growth or volume can become a major challenge in implementing EDI. As the supply chain transactions of modern businesses get more complex, the challenges of working with EDI are also steep.

APIs can use EDI, or do without it. And unlike traditional EDI, they let different systems talk to each other in real time. As businesses digitize their operations, they're adopting more API-based services.

EDI vs API: Primary Differences

EDI is a technology used to standardize the electronic transfer of business documents, while API is a technology used to integrate different types of software applications. EDI systems use messaging formats like EDIFACT or ANSI X.

API is the synchronous exchange of small payloads in JSON format via HTTP. EDI is the asynchronous exchange of batches of X12 or EDIFACT transactions as text files over AS2.

Electronic data interchange (EDI) is the automated exchange of business documents between organizations. Daily business workflows require the exchange of documents like invoices, purchase orders, and shipping forms.

API integration focuses on connecting live applications and systems, enabling real-time data access and a seamless digital experience. Data integration, on the other hand, deals with consolidating data at rest from various sources, ensuring a single, unified dataset for better decision-making and analysis.

Application programming interface, commonly known as API, is a popular method for integrating directly to your freight provider. API integrations can minimize or eliminate those frustrating back-and-forths that drain your team's time and cut into productivity.