25 May Benefits of EDI Transmitted Messages for the Logistics Industry
Digitization is engulfing the logistics industry with the ongoing COVID-19 outbreak. Shipping Lines, Freight Forwarders in maritime ecosystem and Cargo Handlers in Air Ecosystem are fast embracing digital technologies. The ones who only planned to have digitisation as part of their long term plan, are now rapidly implementing it.
Electronic Data Interchange (EDI)
EDI is a key module in an ocean freight software or in general a logistics management software. It ensures instant data capture and transmission among all stakeholders in minutes. Moreover, it lowers the time involved in manual documentation and processing as well as offers data accuracy. Reportedly, EDI can speed up business cycle by 61 percent. Here are certain perks of EDI transmitted messages in the Logistics ecosystem.
Rapid processing
Emails and standalone ERP systems will have to wait for someone to send it across to the next stakeholder. For example, let us say the invoice is in a PDF form and it is sent to the forwarder who is yet to receive it. Rather, the invoice can be sent as an EDI message, which is instantly transferred to the next stakeholder in the system who can let the freight move ahead. This rapid processing will ensure operational efficiency and shorten the order processing time. Even with a smaller number of staff or no staff, EDI message transmission can be initiated for rapid processing of freight.
Lower cost
A major problem with manual documentation process includes the cost. Yes, for every document a cost is incurred and as the document is manual, the risk of liability in terms of mistakes as well exists. Even the case of data manipulation exists with manual documentation. EDI message is a boon to the logistics industry in this case. It brings data transparency, and most importantly, zero cost incurred. Therefore, stakeholders can save a lot on documentation and indulge in paperless as well as contactless trade given the current pandemic scenario.
Data accuracy
As we discussed before, the case of data inaccuracies is quite a pressing issue for the logistics stakeholders. For example, let us say a forwarder is submitting Bill of Lading and other documents to the Shipping Line. The Shipping Line executive identifies discrepancies in documentation and disagrees to process. Now, the Forwarder should go for another rendezvous to see why the mistake happened and how it can be sorted. All this put together, causes delay in freight movement. But with EDI transmission, there is no scope for discrepancies in documentation as everything here is automated.
Strategic benefits
Adopting a demand-driven and agile business processing approach is key in Logistics industry. Due to manual documentation, stakeholders were burdened with delay in overall freight processing and several other discrepancies. EDI offers a strategic advantage to enable faster decision making and better responsiveness to customers. Also, this helps businesses adopt a demand driven approach.
While, EDI is just a module in several logistics management software and trade facilitation systems, there are several other key modules that enable agile automation. Some of them include online slot booking, dock management, terminal management to name a few. In the meantime, also know the perks of e-DO services for the maritime trade.