Definition of Electronic Data Interchange



Electronic data interchange is a mode of business-to-business communication. It gives the concept of using the standardized electronic formats that are commonly used for communication between one organization and others. Unlike traditional paper-based communications, the electronic data interchange allows more swift and secured transmission of important information.

 


The sale orders and purchase orders are commonly used by trading organizations that include the standard format of quantities, rates, payment terms, expected date of payment, mode of transportation, etc.

 


Other common formats are emails and inquiries that are standardized, having a proper sequence of sender and recipients, and a timeline of the conversation under the same subject.


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