Want Predictable EDI Pricing? Look to the Cloud.

As much as we all rely on EDI transmissions for efficient communication with our trading partners, and as much as we all accept that we’re going to have to pay something for this service, most of us have questioned our EDI pricing at some point.

One month, the bill seems reasonable. The next month, the bill skyrockets. You start asking yourself, “Did we really add that many customers? Did we really run that much data through the system?”

And then you go over the bill with a fine-tooth comb, making sure you haven’t been overcharged. In the end, the billing will probably make sense, and you’ll reluctantly make your payment.

If your EDI bills don’t seem fair or consistent, you’re not alone. The problem is that most EDI providers are using antiquated pricing models that work to their advantage.

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.

The Orderful cloud EDI platform uses the internet to offer predictable billing for companies that use EDI. Rather than charging you by the amount of data you use, we simply bill according to the number of unique integrations you have for each trading partner. We call these “relationships.”

So, for example, suppose you have 20 trading partners and you exchange invoices, POs, and ASNs with each. In our platform that’s 60 relationships, and that’s what you’ll pay for. Add another partner with the same three transaction types, and you’ll now be paying for 63 relationships—regardless of how many transactions you actually send in a month or how much data each transaction contains.

As your business grows and you add new trading partners, Orderful gives you price breaks. So you’ll pay more in total, but you’ll pay less per trading partner. And we never charge consulting fees for building your connections—that’s included in our pricing.

If you’d like to learn more about our EDI pricing, please reach out to a network enablement expert at Orderful. We’re here to help. Connect with us today!