What Is EDI? Here’s How It Works

If you’re in the trucking industry, you might have heard of EDI, or Electronic Data Interchange. But you might not fully understand what it is or why it’s important. EDI is not yet required by government regulations, but when fully integrated as part of a truck management system (TMS), it can revolutionize your paperwork processes. Here is what you should know.

What is EDI and how does it work?

Electronic Data Interchange was invented in the 1960s and started moving into the mainstream in the 1980s and 1990s. Today, it is a valuable part of many industries, including transportation. It replaces not only snail mail, but also faxing and email. When important documents need to be transferred between businesses, they flow straight through the companies’ EDI software, ensuring that they are quickly available when needed.

EDI minimizes the risk of documents being lost, misplaced, or overlooked. It also lowers costs and reduces the amount of time employees spend on paperwork.

In the trucking industry, many documents need to flow between the shipper, carrier, and freight broker. These include, but are not limited to:

• Bills of lading
• Invoices
• Tender shipments
• Shipping manifests
• Payment receipts

When all relevant parties have EDI, it becomes a simple matter to fill out the proper documents and send them on their way. If a document needs to be signed or acknowledged and returned, the recipient can do that right from the EDI system. Because of its ability to lower both costs and work hours, as well as human error, many of the biggest shippers and carriers insist that the carriers and brokers they work with utilize EDI.

What to look for in a TMS to make sure it is EDI compatible

Most truck management systems do not include EDI capabilities. In this case, you would need to separately pay for EDI implementation, which could cost anywhere from $5,000 to $20,000. And your EDI would likely not be integrated into your TMS, requiring you to juggle different software solutions for different aspects of your business.

Fortunately, there is another option. Loadsmart’s Carrier TMS has partnered with a variety of EDI companies to offer you full EDI integration within our TMS software. You won’t need to switch back and forth between systems.

How EDI works in Carrier TMS

Through our marketplace, you will select one of our vetted and trustworthy EDI partners. Then, thanks to our seamless integration, you will be able to use your new EDI system from within Carrier TMS. We already offer a robust suite of tools including:

• QuickBooks synchronization
• Invoice generation
• Driver earnings statements
• Electronic logging device (ELD) reports
• Fleet tracking

With EDI, you’ll be able to share all this data and more between shippers, brokers, and carriers. It takes just a few clicks to send documents, and you’ll receive notifications when you have new documents to review.

Sign up for a demo!

Loadsmart partners with a variety of EDI companies of different sizes, styles, and price points, allowing you to choose the one that best fits your business needs and objectives. No matter which you choose, though, you can be confident that the services you receive are fully integrated into Carrier TMS. To learn more about Carrier TMS’ EDI integration, we invite you to have a look at our demo video and then sign up for a demo today!