EDI System

What is EDI?

Electronic data interchange (EDI) is a standard format for exchanging business documents. These documents are exchanged between suppliers and retailers. EDI is made up of two components: translation and communication. During the translation process, the business data is changed into a standardized EDI format.

There is a large number of standardized EDI formats that are used by various companies. Walmart currently supports:

ANSI X12 (American National Standards Institute)
UCS (Uniform Communications Standards
VICS (Voluntary Inter-industry Commerce Standard)

Walmart stays within the VICS and UCD guidelines.

Once the business document is translated into a standardized EDI format it is communicated (electronically sent) to the intended recipient. Just like with translation, there are various methods of EDI communications available. The method that is used by Walmart and their suppliers is AS2.

Walmart and EDI

Walmart believes that its business partners should all be using EDI since it decreases human interaction and errors, eliminates costs of physical file storage, reduces management time, and reduces transaction time realized with EDI.

The EDI system acts as the “eyes” of Walmart. The system provides scanners which read the UPC bar codes on the container or label. All of this data is fed into a database where it can be interpreted by the local Walmart manager. This data can also be accessed by the headquarters computers for decision making at a national level. Aside from Walmart using their EDI systems, a lot of this data can be access by the suppliers and consumers, who can see the inventories of their products at different Walmart stores.

How can the information provided by EDI be used to help some of Walmart’s suppliers?

The inventory of their product can be determined for each individual product
Sales can be computed by location to help with supplier market research
Product flow is accessible and detailed

References:
Electronic Data Interchange. (2008, January 1). Retrieved November 2, 2014, from http://aggie-horticulture.tamu.edu/syllabi/315/technology/wal-mart.html
Walmart Stores, Inc. Getting Started with EDI Implementation Guideline Document version: 1.0. (2011, November 1). Retrieved November 2, 2014, from http://c46b2bcc0db5865f5a76-91c2ff8eba65983a1c33d367b8503d02.r78.cf2.rackcdn.com/96/94/da43534249f4acf56eb3a6c3d032/getting-started-with-wal-mart-edi_129954166278575666.pdf
Cyop consulting. (2014, January 1). Retrieved November 2, 2014, from http://www.cyop.net/Walmart_EDI.html