What is an EDI File? EDI File Formats and Functions Guide

An EDI file consists of several components that work together to communicate key information:

Segments: Groups of related data element. Consider an EDI 850 (Purchase Order), where a given segment provides details related to the buyer, and another one tells what is being purchased.

Data Elements: Individual pieces of information (item code, quantity and price) are called Data Elements. Each element is coded and uniform and clean.

Loops: Loops are groups of segments that repeat many times, for instance many products or a product for each customer, in one purchase order.

Delimiters: Organized segments and elements within the file-based data using delimiters (e.g., *, |, ~): Special characters (including *, |, ~) separate the segments and elements of the file.

Most Common EDI Formats

EDI files come in various formats, depending on the industry or geographic region. Below are some widely used formats:

• ANSI X12: At least in North America, we refer to ANSI X12 as X12, which is an EDI (Electronic Data Interchange) standard (very common) that is often used. The American National Standards Institute (ANSI) form, itself based on the Accredited Standards Committee X12 (ASC X12) of which it is a part, has been developed and applied to the electronic exchange of business data in a standard fashion for several industries (like retail, finance, healthcare, and transportation). Examples: EDI 850 (Purchase Order), EDI 810 (Invoice).
• EDIFACT: EDIFACT (Electronic Data Interchange for Administration, Commerce and Transport) is a globally accepted standard for EDI. Other than that, EDIFACT is developed under the guidance of the United Nations (UN/CEFACT), in order to enable the international trade by making electronic business transactions in general. ORDERS (Purchase Order) / INVOIC (Invoice).
• XML: EDI XML is formed by mixing the robust features of the typical EDI with the pliability and accessibility of Extensible Markup Language (XML). Another advantage to using XML for EDI is that it allows businesses to have easier integration through web based systems and modern software solutions while still keeping structured information exchanging. cXML is used for e commerce transactions.
• TRADACOMS: TRADACOMS (Trading Data Communications Standard) is an EDI standard commonly used throughout the United Kingdom, predominated in the retail and supply chain sectors. TRADACOMS is one of the earliest for providing a consistent structure and format to business transactions, introduced in the early 1980s by the UK Article Numbering Association (now GS1 UK). ORDERS (Purchase Order), INVFIL (Invoice) are examples.
• HL7: HL7 (Health Level Seven) is an international standard to communicate patient data in a secure manner. HL7 is a service of Health Level Seven International (HL7), and was established to make healthcare information in diverse systems interoperable and able to communicate seamlessly between providers, payers and other stakeholders. Examples: Patient admission or discharge records.

Reading an EDI File: A Simplified Example

Here’s an example of an EDI 850 (Purchase Order):

ISA*00* *00* *ZZ*SENDER ID *ZZ*RECEIVER ID

*211216*1234*U*00401*000000001*0*P*>~

GS*PO*SENDER ID*RECEIVER

ID*20241216*1234*1*X*004010~

ST*850*0001~

BEG*00*SA*12345**20241216~

REF*DP*001~

N1*ST*BUYER NAME~

PO1*1*10*EA*100.00*NE*BP*123456~

SE*6*0001~

GE*1*1~

IEA*1*000000001~

Each line represents a segment, and the * and ~ characters serve as delimiters to organize data.

How EDI file formats work

EDI standards can also follow structured rules to make sure that the sender as well as the receiver understand and process the data correctly without spoiling anything. Electronic communication between businesses is based on these standards. Principles and components of EDI message are offered as follows:

Syntax: How of the data is put together rules the syntax. These are the rules to define the characters allowed and a specific manner in which these elements must be arranged. This is to ensure that when an EDI document is sent, it will follow a recognised structure so when the message is sent out, it will be decodable correctly within the receiving system. Imagine it as grammar rules of some language.

Codes: Currency USD, EUR, country name USA, GER, date format DDMMYYYY. Standards of codes eliminate ambiguity. For example, “USD” means that the receiver understands that the currency being referred to without spelling it out in full.

Message Designs: this tells you how individual sorts of messages (an invoice, a purchase order, a shipping notice, etc.) should be laid out and which rules apply to them. For instance, the purchase order might be designed with sections arranged in proper syntax such as for product details, quantities and pricing.

Identification Values: The identification values are used to identify and place a particular data into an EDI file. The values may be the position of the data in the message or be separated. Suppose that a separator like a tilde (~) or something similar indicates the end of a segment in order for the receiver’s system to know where one piece of data ends and another begins.

Choosing the Right EDI Format

To select the right format, consider:

• Industry Standards: Ensure compatibility with regulatory requirements in your sector.
• Partner Requirements: Align with the preferences of your trading partners.
• System Compatibility: Verify that your internal systems and EDI software can handle the required format.

Advantages of Using EDI Formats

Using EDI formats offers many benefits that can change how businesses communicate and operate. One of the main benefits is the speed it offers - which once takes day or week to treat through manual methods, now meets in seconds, which allows companies to respond to market requirements quickly. EDI also improves accuracy by reducing manual data introduction requirements, reduces errors such as duplicate or missing information. This not only saves time, but also creates confidence with business partners.

In addition, EDI can cut costs significantly by eliminating paper -based procedures and reducing administrative overheads. It also ensures compliance with industry standards and rules, making it easier to trade with partners that require specific formats, such as retail or health care. Overall, EDI operations streamline, promotes strong relationships with business partners and help companies to remain competitive in a sharp, digital world.

EDI File FAQ (Frequently Asked Questions)

1. What is an EDI file?

An ED (Electronic Data Interchange) file is a structured text document that allows companies to provide electronic information in a standardized format. General EDI filters include invoices, purchasing orders, shipping alerts and payment advice.

2. What does an EDI file look like?

EDI files are usually common lessons with specific formatting using segment identifiers, data elements and Rander. They may look complicated because they are designed for the system, not for humans. For example, a line may look like:

N1*ST*Acme Corporation*92*12345~

3. How are EDI files transmitted?

EDI files are usually sent to ensure data security and integrity during transmission during the use of secure methods such as AS2, SFTP, FTP over VPN or Vans (Valuded Network).

4. What systems read EDI files?

EDI files are read and treated by EDI Translation Software, ERP system or special intermediate solutions that convert EDI into human-elective format or integrate it directly into workflakes.

5. Can EDI files contain sensitive information?

Yes, EDI files often have sensitive business data such as payment information, product description and prices. That is why safe transmission methods are important.

6. Do I need technical knowledge to work with EDI files?

While technical knowledge helps, many modern EDI solutions provide user -friendly interfaces as abstract technical complexity. However, IT or EDI experts often handle layouts, mapping and maintenance.

To learn more about how Infocon Systems can take care of your EDI needs for trading partners, please don’t hesitate to give us a call at +1 888-339-0722 or email sales@infoconn.com. We’d love to hear from you.