B2B commerce is changing. The demands on our practices are growing as the expectations of our buyers increase. They want more digital experiences that feel like DTC, more information on products, pricing and inventory, and they want their orders faster—all while continuing to honor their legacy purchasing practices.
This puts B2B commerce leaders in a challenging position. How do we meet rising expectations without incurring additional overhead and process debt? Nowhere is this challenge more evident than in EDI. Large retailers are transacting more than ever, and market power dynamics necessitate we continue to honor the specificity that EDI protocols bring. The pace is such that maintaining a separate pipeline for EDI is extraordinarily resource-intensive, especially for DTC-first or digitally native brands.
Connecting electronic data interchange (EDI) with modern cloud-based order management systems (OMSs) has been a game-changer. EDI has long been a trusted tool for exchanging business documents quickly and accurately—but the real challenge has been making these EDI processes work seamlessly with advanced OMS platforms like Shopify.
For CTOs and CIOs at Fortune 500 retailers and large direct-to-consumer companies, integrating EDI with Shopify's OMS is a golden opportunity. By funneling EDI orders into Shopify's commerce operating system, businesses can tap into its wide range of integrations and smart business logic. This not only makes fulfillment a breeze, but also boosts efficiency, scalability, and customer satisfaction.
We were able to connect with two leading technologies on the forefront of this space to learn how savvy enterprises can bring their B2B operations into the modern era by linking EDI with Shopify's cloud-based OMS. We'll take a look at the current B2B landscape, explore why this integration is so compelling, and share best practices for making it happen.
The current landscape of B2B commerce
We’ve established that B2B commerce is evolving rapidly, with a changing demographic of buyers. The traditional channels of commerce have a new upstart in their midst: B2B ecommerce.
For leaders in commerce, the challenge isn’t necessarily maintaining these distinct channels—it’s optimizing them so they work in concert with, and not against, one another.
Here’s what we’re seeing in the market right now.
Self-serve buying portals (ecommerce)
Digital purchasing portals are becoming the backbone of B2B commerce. Driven by the demands of a younger demographic that has become a primary driver of purchasing decisions, access to information and a seamless self-service experience is growing faster than almost any other channel.
These portals act as a central interface for all manners of buying activities that customers can use to self-serve. From showcasing products and upcoming catalogs, managing orders, settling invoices, and tailored buying journeys, these interfaces are becoming about far more than just reordering and transactions. At Shopify, we’re already building incredibly advanced portal experiences that layer in capabilities like sales rep negotiation and post-purchase notifications.
Offsite digital (EDI & eProcurement)
Even with the rise of ecommerce, EDI and eProcurement are still crucial for B2B operations, especially for retailers and brands handling large transaction volumes. Both EDI and Punchout require conforming systems, processes or both to trading partner requirements. This is a daunting task for an organization to take on, particularly if each connection is going to be unique to that trading partner.
“EDI isn't going away, but it is evolving. We're seeing increased demand for real-time capabilities rather than batch processing, better support for omnichannel scenarios, and more flexible data models.”
EDI still remains the incumbent method of digital ordering in B2B retail, and with many of the world’s largest retailers requiring it as part of their vendor management process, smaller, digitally-native brands are adopting eProcurement and EDI earlier and earlier in their journeys.
Offline (sales and account management)
While digital channels are on the rise, traditional offline methods still hold significant sway in B2B commerce. Sales teams and account managers are still essential for building strong customer relationships, negotiating deals, and offering personalized service. In many industries, face-to-face interactions and offline negotiations are still the principal customer touchpoints. Honoring this while improving the channel’s ability to close and service orders remains a chief consideration for B2B commerce leaders.
As B2B commerce continues to evolve, businesses need to juggle these diverse channels effectively to ensure smooth and efficient operations.
“Streamlining item and inventory visibility, order fulfillment, product performance, and compliance metrics positions a brand as a trusted partner to better accomplish what matters most - satisfying the end consumer. And, where instant gratification is the new norm for those consumers, the capabilities and expertise needed to meet those needs will continue to shift.”
Integrating EDI with cloud-based OMS platforms like Shopify offers a powerful way to harmonize digital and offline strategies while streamlining order management processes. In the sections that follow, we'll dive into how this integration can drive operational excellence and elevate the customer experience in today's B2B landscape.
The case for integration: EDI and cloud OMS
In the infinite game of achieving total efficiency, connecting EDI with a cloud-based OMS like Shopify is a strategic move both in the short term and long term. This integration not only tackles the complexities of managing B2B transactions, but also unlocks a treasure trove of benefits that boost efficiency, scalability, and customer satisfaction.
Here are four reasons why CTOs and CIOs should seriously consider this strategic step:
Operational efficiency
The first and most apparent benefit of integrating EDI with a cloud-based OMS is automation of order processing. By cutting out manual data entry and reducing the risk of errors, businesses can streamline post-purchase operations and just focus on execution.
Automated workflows ensure orders are processed quickly and accurately, freeing up valuable resources and minimizing delays. Shopify already exists as a principal ingestion point for many merchants’ order-management workflows, meaning the same suite of integrations and setup can be utilized across EDI orders as well. Complicated order-routing processes, decision trees, and integrated freight providers can easily become part of an automated operations layer through a platform like Shopify.
“Setting a business up for growth and scale requires automation of workflows across multiple business systems, end-to-end visibility, and the ability to share order and shipping data with partners and customers. Brands that lay the groundwork to meet expectations as they scale are set up for long-term success and brand loyalty.”
Scalability
Technology leaders in commerce need to constantly be thinking about how to achieve nonlinear results. As the B2B practice’s digital footprint grows, so too does the number of transactions it needs to handle. A cloud-based OMS provides the scalability needed to manage increased order volumes without scaling infrastructure and resources at the same rate.
“The push-pull of expense vs. profitability is one that keeps all business owners up at night. In this new reality where consumer expectations are a business’s North Star, achieving the right balance will be critical to its future and will help them stand out as a leader.”
This flexibility manifests in sales reps being able to negotiate more orders, and buyers placing increased offsite digital orders through EDI and Punchout, because the downstream ordering systems have consistently scaled to deliver orders in a timely and error-free fashion.
Real-time data access
Integrating with a cloud OMS gives businesses real-time visibility into crucial data like order status, inventory levels, and customer information. This is, of course, wonderful for customer service and account teams to have while they speak directly with customers—but we shouldn’t forget marketers and data scientists. This transparency empowers businesses to make informed decisions quickly and adapt to market changes with ease. Real-time data access also boosts collaboration across departments, ensuring everyone is on the same page and working towards shared goals.
“Visibility is a large pain point in EDI. Merchants want real-time insights into their order flow and issue resolution, similar to what they get with their direct-to-consumer channels.”
Enhanced customer experience
In today’s competitive landscape, delivering a top-notch customer experience is a must, even for B2B. By integrating EDI with Shopify’s OMS, businesses can improve order accuracy and speed up delivery times, leading to happier customers and stronger loyalty. In a mature B2B EDI practice, customers are often utilizing different transaction sets and document requirements. In some cases, only purchase orders are submitted via EDI, and every other touchpoint is expected to be outside EDI. Integrating to Shopify provides a pane of glass associated with the EDI order that can be enhanced with the ability to track orders, communicate updates, pay invoices and see credit limits all in real time. Creating delightful B2B buying experiences is what will differentiate brands in the next phase of commerce.
In a nutshell, integrating EDI with a cloud-based OMS like Shopify offers a strategic edge for enterprises aiming to modernize their B2B operations. By harnessing the power of automation, scalability, real-time data, and enhanced customer experiences, businesses can set themselves up for success in an increasingly digital world. In the next section, we’ll dive into the practical aspects of implementing these integrations and share best practices to ensure a smooth transition.
The shape of integrations
Integrations have always been the greatest barriers to entry into cloud-based digital EDI. Historically, every trading relationship was built bespoke and point-to-point, meaning there were very few economies of scale to realize as your EDI practice expanded.
“When brands land a big retail account, they need to be EDI-capable quickly. Traditional EDI solutions often require weeks or months of setup time, which can delay these important business relationships. Many retailers are also pushing for real-time data exchange and better error reporting, which aligns with their move toward more automated, data-driven supply chains. If a vendor can’t meet these EDI standards, the retailer often won’t even consider them.”
With the advent of cloud and API-first solutions, we can start to abstract away the point-to-point complexity and marshall our integrations into much more consistent patterns, regardless of the retail trading partner we’re working with.
Systems like SPS Commerce and Orderful create comfortable document-management conduits that speak the language of retail EDI. What they render are much more comfortable views, and data models for downstream systems to read.
Placing powerful EDI management systems at the frontlines of your EDI trading practice unlocks the ability for downstream OMS flexibility.
A cloud OMS like Shopify has both a standardized data model and standardized order statuses. That means that it’s simple to interact with when an EDI file needs to be updated with ASN information in an 856 file, because connected systems are always looking in the same place. In fact, all of the documents exchanged in a standard EDI transaction—850, 855, 860, 997, 856, or 810—all simply become single-line updates on the Shopify order record.
Combined with a cutting-edge EDI management platform, your operations teams won’t need to know the difference between orders originating from any EDI-enabled retailer, and more importantly, won’t have to adapt their response to each one either. This standardization is key to creating performant OMS processes, giving your team a more ideal blank page to start with, rather than asking them to paint between the lines of existing work.
Looking ahead
In the fast-paced world of B2B commerce, integrating EDI with a cloud-based OMS like Shopify is more than just a smart move—it's a strategic necessity. This integration allows businesses to streamline operations, scale effortlessly, tap into real-time data, and deliver standout customer experiences. By bringing together traditional EDI processes with cutting-edge cloud technology, companies can achieve new heights, setting themselves up for success in an already competitive market.
“There's also growing interest in using EDI data for analytics and automation, not just transaction processing. The focus is shifting from just moving documents to extracting business intelligence from the data flowing through these systems.”
For CTOs and CIOs at Fortune 500 retailers and large direct-to-consumer companies, the path forward is clear. Embracing this integration not only tackles current operational hurdles but also lays the groundwork for future growth and innovation. By leveraging Shopify's OMS, businesses can seamlessly blend their digital and offline strategies for a cohesive operation.
“In our network, we see businesses leverage these systems and integrations to support expansion in other areas of the business including merchandising and inventory management”
Ready to modernize your B2B operations and unlock the full potential of EDI and cloud OMS integration? Start by assessing your current systems and pinpointing areas for improvement. Engage with industry experts and tap into best practices for a smooth implementation. Reach out to Shopify's enterprise team to discover how our platform can support your integration journey and propel your business forward.
Take the first step toward transforming your B2B operations today. Contact us to learn how Shopify's OMS can help you achieve operational excellence and deliver unmatched value to your customers. Let's shape the future of B2B commerce together.
