In today’s competitive retail landscape, businesses across Australia and New Zealand are under pressure to be faster, leaner and more connected than ever. From the factory floor to the shop shelf, electronic data interchange (EDI) is helping manufacturers, suppliers, distributors and retailers work together more efficiently. By digitising how supply chain partners share information—orders, deliveries, invoices, and more—EDI is making the entire retail ecosystem stronger, smarter, and future-ready.

What Is EDI?

Simply put, EDI (electronic data interchange) is the exchange of business information directly between business software. Think of a purchase order being created in one company’s accounting package, and it ‘magically’ appears in the supplier’s software; no email, no PDF, no manual data entry. Well, it’s not magic, it’s EDI!

Starting at the source: manufacturers and suppliers

The journey begins with the people who make or source the goods – manufacturers and suppliers. When a retailer or distributor places an order via EDI, it lands straight in the supplier’s system, ready for processing. Whether the supplier is sourcing locally or globally, EDI helps them:

• confirm product availability
• respond quickly to order changes
• manage lead times more effectively
• send digital confirmations and updates.

Suppliers can also use EDI to communicate with their own vendors, helping them maintain stock levels and plan ahead. For manufacturers, much like suppliers, EDI can automate order processing. Orders for raw materials, make-to-order or custom builds can go straight into their software. For manufacturers who produce on demand, EDI can even integrate with production planning systems to trigger workflows as soon as the order comes in.

Through the supply chain: warehousing and distribution

Once goods are packed and ready to ship, advanced shipping notices (ASNs) are sent via EDI to alert the next link in the chain. These ASNs provide details on what’s being delivered, in what quantities and when. That allows receiving teams to prepare and improves inventory accuracy. With standardised labels and barcode integration (like SSCC labels), goods can be tracked from origin to shelf with minimal manual input.

At the retailer: smarter ordering and replenishment

Retailers can create orders and send them directly to their suppliers’ software. Retailers can get responses back from suppliers to confirm if they can fulfill the order and also receive invoices directly into their software. You can take it even further with the information you get from EDI. When stock drops below a set threshold, EDI can trigger and order automatically to suppliers or distributors, reducing out-of-stocks and avoiding overordering.EDI has applications all across the retail supply chain. Want to learn more about implementing EDI? Get in touch with our experts.

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Electronic Data Interchange (EDI) is a powerful tool for improving efficiency, accuracy and speed in supply chain management. But simply adopting EDI isn’t enough –you need a solid implementation plan to ensure a smooth transition and maximise the benefits. Whether you’re new to EDI or looking to optimise your existing setup, following best practices can make all the difference. Here’s a step-by-step guide to help you get it right.

1. Get an internal team together

EDI implementation isn’t just an IT project – it affects multiple departments, including procurement, finance and logistics. Form a cross-functional team to oversee the process, ensuring that all key stakeholders are involved from the start. This will help with decision-making, troubleshooting and overall coordination. While putting together your internal team, think about your objectives. Make sure all internal departments are providing input on what they want to EDI to do for them.

2. Look at your processes and identify areas for improvement

Before diving into EDI, assess your current supply chain processes. Where are the inefficiencies? Are there bottlenecks that slow things down? Identify the pain points that EDI can help resolve, such as reducing manual data entry, minimising errors, or improving order fulfilment times. EDI isn’t just about automating transactions –it’s about improving visibility and decision-making. Consider what data you need from your supply chain to enhance forecasting and inventory management. Ensure that your EDI solution supports the exchange of this critical information. No matter where you sit in the supply chain, look at all aspects such as logistics/3PLs, suppliers, retailers, manufacturers, and warehousing.

3. Get your partners involved early

Successful EDI implementation depends on your trading partners being on board. Engage with them early to understand their capabilities, challenges and requirements. Work collaboratively to find solutions that work for everyone. This will help prevent delays and ensure a smoother rollout. Not all your suppliers and customers will be at the same level of EDI capability. Some may already be using EDI, while others might need more support. Make a list of your key trading partners and evaluate their readiness. This will help you prioritise onboarding efforts and address any potential roadblocks. Smaller suppliers may not have the resources or expertise to implement full-scale EDI. A web portal solution can make it easier for them to participate without needing a complex setup. We provide customers with a web portal solution, Colladium, that‘s free to use for your partners to send and receive EDI documents through a simple, user-friendly interface.

4. Plan for onboarding support

Onboarding partners to EDI can be a challenging process, especially for trading partners who are new to EDI. Provide clear documentation and support to help them transition smoothly. Assign a dedicated contact or team to assist with questions that may arise during implementation. Testing EDI messages with your partners is another thing that can take time and resources. A solution we provide our customers is automated message testing. It lets your business partners test the messages they’ll send you, before actually sending them. They’ll get feedback there and then. And no manual checking from your team, your partners do it all on our Colladium web portal. This takes a lot of the heavy lifting off your plate.Want to learn more about implementing EDI across your supply chain? Get in touch with our experts.

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