Electronic Data Interchange (EDI) is a standardized electronic format for exchanging business documents, such as purchase orders, invoices, and shipping notices, directly between the computer systems of trading partners. It replaces paper, PDFs, and email attachments with structured transaction sets that flow automatically from one system to another. Because both sides agree on the format in advance, the data can be processed without a human retyping it.
How it works
Each document type maps to a numbered transaction set defined by a standard such as ANSI X12 (common in North America) or EDIFACT (common internationally). A purchase order is an 850, an invoice is an 810, and an advance ship notice is an 856. The buyer’s system generates the document, translates it into the agreed format, and transmits it over a network such as AS2, SFTP, or a value-added network (VAN). The supplier’s system receives it, validates it, and loads it into their order or ERP system.
Why it matters
Large retailers, distributors, and manufacturers often require EDI as a condition of doing business. It reduces manual entry errors, speeds up order-to-fulfillment cycles, and creates an auditable trail. For a supplier, being “EDI capable” can be the gate to winning bigger accounts.
How it relates to B2B quoting on Shopify
EDI usually handles the transactional stage after a price is agreed. Quoting sits upstream: a buyer requests pricing, you negotiate, and the accepted quote becomes an order. On Shopify, an accepted quote can convert into a draft order or order that then feeds your fulfillment and, where required, an EDI pipeline through a connector or middleware. Knowing where quoting ends and EDI begins helps you map the full buyer workflow. See the B2B quoting glossary for related terms.