Most EDI providers bill for their services in one of three ways:
- By volume. You pay according to the number of transactions you perform.
- By transaction size. The more data you send, the more you pay.
- As a managed service. You pay a flat fee per billing period, regardless of volume—but the provider will probably raise their prices as your business grows.
At first glance, these EDI pricing policies seem easy to understand. After all, we’re used to paying more when we use more of something.
But with the advent of the internet, bandwidth is no longer an expensive commodity.
When EDI was first developed, we were all sending the smallest files possible over phone lines. Sending data across these wires actually cost money.
Since then, we’ve all moved off of phone lines and onto high-speed internet. We can send vast amounts of information in milliseconds—and it’s rare for anyone to reach the monthly bandwidth limitation set by their internet service provider. So, why should you continue paying more every time you have a busy month with lots of transactions?
It’s to the advantage of EDI providers to continue billing this way. But it’s not to your advantage.
When you add a few new trading partners to your network, you can expect your EDI bill to surge. By how much? Well, that’s tough to say, because it’s up to your EDI provider. So it’s nearly impossible for you to budget accurately for this expense.
The increase in drop shipping has only intensified the problem. Whereas in previous years you might sell 1,000 units at a time to a wholesaler, today you’re probably seeing more and more cases where you sell 1,000 units directly to, say, 500 consumers. This increases your EDI transaction volume and can blow a hole in your budget.
You need fair, predictable, SaaS EDI pricing for your EDI transactions.