EDI ELECTRONIC DATA INTERCHANGE

By:Abhinav Verma MBA-IB

INTRODUCTION TO EDI

What is EDI?

Electronic Data Interchange is the computer-tocomputer exchange of business data and documents between companies using standard formats recognized both nationally and internationally. The information used in EDI is organized according to a specified format set by both companies participating in the data exchange.

HISTORY OF EDI
The

general idea behind EDI was originated by a group of railroad companies in the mid1960s, in the United States. Much of the early work on EDI was driven by the industry sectors for:

transportation pharmaceuticals groceries automobiles banking

CONTD..
Both

client and vendors input their requirements to create a set of standard data formats that
were hardware independent; were unambiguous and could be used by all trading partners; reduced labor-intensive tasks such as dataentry; allowed the sender of data to control the exchange including receipt confirmation of by the other party

ADVANTAGES OF EDI
Lower

operating costs Saves time and money Less Errors = More Accuracy No data entry, so less human error Increased Productivity More efficient personnel and faster throughput Faster trading cycle Streamlined processes for improved trading relationships

DISADVANTAGES

High Dependence on the participation of trading partners Costly for smaller companies Difficult to agree on standard to be used

ORIGINAL MODEL
Retailer A

Wholesaler A

Retailer B

Wholesaler B

Retailer C

Wholesaler C

Retailer D

Wholesaler D

VALUE-ADDED NETWORK (VAN)

Communications networks supplied and managed by third-party companies that facilitate electronic data interchange, Web services and transaction delivery by providing extra networking services

VAN MODEL
Retailer A Wholesaler A

Retailer B Value-added Network Retailer C

Wholesaler B

Wholesaler C

Retailer D

Wholesaler D

WEB SERVICES

Applications that use a universal language to send data and instructions to one another, with no translation required.

EDI IN CUSTOMS
Customs to Port Trusts/Airport authority. Customs to Customs. Customs to DGFT (Min of Commerce). Customs to Export promotion councils, like AEPC, HEPC, etc Customs to RBI/Banks. Customs to Importers/Exporters Customs to Custom House Agents Customs to Shipping Lines/Airlines

FUTURE SCENARIO

It should be possible to create a few or even a single message/document for the entire process of transactions in the course of foreign trade. Importers file B/E / S/B electronically with the Customs which could cover more data so that Port Trust, CFS's, Transport authorities, Sales Tax Dept. are able to use the same.

ELECTRONIC COMMERCE/EDI GATEWAY AND NETWORK

On 01st February 2000, CBEC has invited bids for "Supply, Installation and Commissioning Of Electronic Commerce/EDI Gateway and Network for Indian Customs".
Tenders are called to propose a complete solution on a turnkey basis comprising hardware, software and networking arrangements.

INDIAN CUSTOMS EDI SYSTEM (ICES)

ICES is now operational in 19 major Customs Stations consider electronic filing and capturing of declarations regarding goods.
Messages are also exchanged with other Government agencies, Trade Promotion organizations, Port authorities, Airports Authority of India, Container Corporation of India, Container Freight Stations and other Customs Warehouse operators.

DATA WAREHOUSE

The Data warehouse would extract data from ICES and SERMON transactional systems to enable easy, flexible analyses by Customs and Central Excise officers.

EDICON

An international conference and exhibition on EC/EDI along with special session for CEOs of top Indian companies in the years 1996, 1998 & 1999
By Department of Commerce Awareness in respect of EC/EDI

NATIONAL COMMITTEES

Process Re-engineering Committee Technical Assessment Group

Sub committee on UN/LOCODE

Committee on Net-banking eTrade project

TRADE FACILITATION THROUGH EC/EDI

Major companies are re-examining and reengineering the ways that products and information flow along the supply chain. EC/EDI can be used in any area or organization that involves information flow. EC/EDI users include Manufacturers, Retailers, Banks, Transport, Customs and Ports and so on. It minimize administrative delays and procedural complexities and reduce the transaction time taken in clearances.

THANK YOU!!