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Customer satisfaction The key benefit of EDI for small business

Buyer pleasure: The important thing good thing about EDI for small trade

According to the Harvard Business Review, it costs five to 25 times more to acquire a new customer than to retain an existing one. So how do you build customer satisfaction levels that lead to growing business and long-term profitable customer relationships? For small businesses at least, the implementation of an Electronic Data Interchange (EDI) solution can be an excellent foundation.

Electronic Data Interchange (EDI) is the computer-to-computer exchange of business documents in a standard electronic format between business partners. The first experience of EDI often comes for many small businesses is when a large customer mandates using it. The idea of transitioning your small business processes from a paper-based exchange of business documents to one that is electronic, can seem costly and time-consuming, leaving some companies to question whether it’s even worth pursuing the business.

In today’s digital world however, the real question is whether you can afford not to have a system that automates the exchange of your key business documents. In a previous blog, I pointed out that about an increasing number of businesses have already made the switch to EDI connectivity, since manual processes are just too slow and error-prone to meet the needs of today’s business.

Manually processing orders may be acceptable when you are only receiving one or two a week, but what happens when you’re getting tens, hundreds or thousands of orders every day? The speed and accuracy of EDI means no manual re-keying, and fewer errors, while key business documents – such as invoices and purchase orders – can flow directly from your ERP or accounting system into that of your customers, shortening your order-to-cash cycle.

There is also one more important benefit: You are making yourself easier to do business with. All the benefits that you receive from EDI also benefit your customers. Your EDI solution is helping them to increase the efficiency and productivity of trading with you – while reducing costs, enhancing customer service and improving customer satisfaction.

Happy customers are profitable customers

Here’s a business truism: If you give your customers what they want, you’re going to have happy customers.

For most customers, what they want is fairly simple. They want good products at a fair price delivered where and when they need them. EDI becomes the foundation for giving your customers what they want. It allows you to ensure order accuracy and speed up the payments process, and it gives you the opportunity to increase communication with your customer so that they always know where their order is within the supply chain and logistics process.

The Harvard Business Review suggests that minimizing the human touch points necessary for any customer interaction improves satisfaction and loyalty. EDI achieves this by enabling end-to-end automated processing of business documents.

This all translates into profitable business for you, and research shows that companies with high levels of customer satisfaction can achieve operating margins up to 6% higher than companies with lower satisfaction. McKinsey suggests that B2B companies with good customer satisfaction see reductions of 10-20% in cost to serve and up to 15% growth in revenues.

In today’s crowded marketplaces, EDI becomes a point of real differentiation for your company. If you continually provide a positive experience when your customers deal with you, they are more likely to buy from you and not your competitors. The more effective your electronic trading capabilities, the more likely that you will retain a close and successful relationship that leads to long-term profitable business.

Key features of an EDI solution

The question for small businesses today is not whether to implement EDI but which EDI solution best fits the needs of your business. Most companies require a comprehensive and cost-effective EDI solution that will grow with their business. Key features to look for in your EDI solutions include:

Ease of set-up and use

For companies with limited resources, it’s important that an EDI solution doesn’t bog down your IT resources or place a great training overhead on the organization. The EDI solution must be simple to install and operate. Leading small business EDI-as-a-Service provides simple and intuitive Windows-based interfaces, enabling you to begin using EDI quickly and easily without the need for specialist EDI or IT skills. In fact, these solutions will free your employees from the manual task of keying in and checking documents, thus avoiding human errors and giving your business room to grow without hiring additional staff.

Comprehensive EDI support

The best EDI-as-a-Service for small to medium sized businesses offer broad support for all major document types and EDI standards. While you’re likely to begin by exchanging invoices or purchase orders electronically, your EDI system should allow you to introduce more electronic trading with customers as time goes on to deepen the relationship and drive customer satisfaction.

The EDI solution you choose must be able to handle all common EDI document standards, including ANSI, EDIFACT and AS2, so that you can trade seamlessly with the widest number of customers.

Predefined EDI templates

One of the most intricate parts of EDI is initially connecting with new trading partners. This can involve a lot of document translation and mapping work to ensure that purchase orders raised in your ERP system can flow automatically into the ERP system of your customers. Leading EDI solutions for small business often include predefined templates that facilitate this process.

ERP and accounts integration

While many EDI solutions for small business allow the efficient transmission of EDI documents, they don’t allow the end-to-end information flows from your accounting or ERP systems. While this may be acceptable when you are only exchanging a small number of documents, it’s not sustainable as your business grows. Even if you start with an entry-level EDI solution it’s important to ensure you can easily transition to a more comprehensive package without losing any data.


If implemented properly, EDI helps your business to grow while remaining lean. As your business grows and you connect to more customers, your EDI solution should scale without the need to recruit dedicated staff to manage your EDI capabilities. For some organizations with ambitious growth plans, it may be worth considering cloud-based EDI services to ensure almost limitless scalability allied to flexible and manageable pricing structures. The EDI-as-a-Service that accommodates growth and future-proof your company with cloud updates containing innovative features and capabilities.

It may still be a customer mandate that brings you to EDI but you should see it as an opportunity to grow in today’s digitally driven business world. By implementing an effective EDI solution, you can get closer to your large customers, conduct business in the way that makes them happy and, most importantly, introduce a platform that lets you grow quickly and cost-effectively as business dictates.

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