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What Is API?

An Application Programming Interface (API) allows two business applications to talk directly to each other and make eCommerce and other business interactions on the Internet possible.

One business application makes an API request to the other business application and receives a response. For example, a supplier connects to their customer’s shopping cart software through an API and retrieves new orders. When orders are shipped, the supplier connects to the shopping cart once again and provides a shipment tracking number for each order.

What Is EDI?

Electronic Data Interchange (EDI) is a standardized exchange of business documents between companies. It's used in the supply chain including industries such as retail, manufacturing, pharma and logistics.

EDI documents are transported back and forth between computers throughout the day. For example, a customer sends an order to their supplier and the supplier responds with a shipment confirmation and invoice, all using EDI. The most benefit is achieved by automating and integrating EDI with business applications.

API or EDI: What's The Difference?

There are two ways to integrate business applications: by importing and exporting files from EDI, or using an API.

With EDI, data moves in batches by first transferring a file between two companies and then integrating the data with the business application. For example, a purchase order is exported from a customer’s ERP system, transported to the supplier, then imported into their WMS. Next, the shipment is confirmed and exported from the supplier’s WMS, transported to the customer, who in turn imports it into their ERP system.

APIs are used by business applications that work in the cloud. APIs move data between business applications one transaction at a time, in real time. Shopping carts, ERP systems, WMS and TMS software have APIs that can “talk” to each other. For example, when a consumer places an order in a shopping cart, an API is used to transfer the order to the supplier's WMS in real time.

Each software publisher is responsible for making EDI and API integration methods available with their products. Which method is better, API or EDI? Each has its own merits and Integral Group supports both.