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Is QuickBooks EDI compliant?

QuickBooks is not designed to be able to send and receive EDI documents, but there is a way to become EDI compliant and automate orders, invoices, and shipments with QuickBooks.

If you’re reading this you’re likely using or looking to use QuickBooks. It’s either helped your company grow, or you’re ready to take the next step in your scaling journey. If you’re looking to work with large retail or distribution partners who use EDI, you want to make sure that QuickBooks can handle both your increased order volume, and the high complexity that comes with managing EDI orders.

The answer to the question, “does QuickBooks handle EDI?” is a little more complicated than a simple yes or no answer. That being said, we won’t bury the lede. It’s more than possible to have a fully functional EDI processing system within your QuickBooks that’s far more economical than switching to a specialized service.

We’ll break down the issues that standard QuickBooks packages have with EDI, the options you have for better EDI order management, and recommendations for how you can set yourself up to be the best possible partner for large scale retailers.

The problems that standard QuickBooks packages face

QuickBooks at its base level doesn’t have specialized ways of dealing with EDI. This brings problems for your order management team as most of their work will have to be done manually. Going into supplier portals, copying information into your order forms, then copying that information into your QuickBooks. That’s not even to mention having to manage each step of the process.

Doing this manually is by nature slow and laborious. It forces your staff to focus heavily on singular orders, and opens you up to the risk of inputting the wrong data. EDI orders tend to be more complicated, and the risk to your company missing an order, or being slow to respond to your trading partner are far higher than in many other business relationships. This is because your company can be fined for not updating your inventory on time, or even getting your products out the door on time.

Read more on how manual order entry leads to higher order errors here.

Keeping track of EDI orders by this method is painful. It’s doable, yes — but it will hurt. It won’t just be in your ordering department either, it’ll make your QuickBooks system far more complicated to work with than you had originally intended. 

To give you an example, let’s look at pricing. 

Usually, QuickBooks only allows for a single price to be attached to a SKU. That works fantastically if you’re selling a SKU at a single price. But what happens when your company scales and you need to sell SKUs at different prices to different trading partners and wholesale customers? As your company grows to become more omnichannel, there are some issues you need to watch out for. 

Your EDI trading partners normally create their own SKU for your product that you need to be able to track. With single pricing for SKUs in QuickBooks and no ability to easily map SKUs to each other, your company will need to find more complicated workarounds. The common one that we’ve heard of is creating duplicate SKUs in your own QuickBooks that are identical in every way except for pricing and being mapped directly to one trading partner by way of prefixes or suffixes to the SKU as identifiers.

This leads to bloat within your system and a far more complicated order management process than you really want your company to handle. In the most extreme cases, you could even start to brush up against the SKU limit that QuickBooks has set for you. 

One of our customers had these exact issues with pricing before coming to us, and they had four key challenges they were facing due to this pricing issue:

  1. Every time a product’s price went up, the company would have to go into their QuickBooks account and search for every copy of that product to make the price changes manually.

  2. Whenever an order was placed by a customer, the order desk staff would have to remember which product code should be used for each customer to make sure that the proper pricing is used.

  3. Running promotions on existing products was almost not worth their time due to the amount of manual intervention that was needed to get one started.

  4. As their business was growing, they couldn’t scale their order desk staff with the amount of manual order entry and manipulation they needed to do.

Again, it’s perfectly possible to run sales and order management through standard QuickBooks packages, but it’s more time consuming than you’d think, and more trouble than it’s worth. As you scale, these issues only get more pronounced. So what are your options?

Your QuickBooks EDI options

As we see it, there are four main options that any company with QuickBooks has when trying to work with EDI.

  1. Remain with your current QuickBooks package and do EDI ordering manually.

  2. Upgrade your QuickBooks package to an enterprise tier to gain better tools for handling your EDI orders.

  3. Shift off QuickBooks entirely and move to another ERP that can handle EDI for you.

  4. Remain with your current QuickBooks package and pursue an EDI integration.

We’ve already covered the issues with manual EDI entry into QuickBooks, but each of the other decisions has a few considerations that you should consider.

Upgrading your current QuickBooks package to one that can help you better handle EDI has merit. You get to keep your existing systems, you don’t have to retrain your staff, and there’s no migration of data. However, by upgrading your package it’s likely that you’ll be paying for additional bells and whistles that you just don’t need yet. It can be highly expensive to an enterprise tier, and many of the functions won’t be worthwhile for your organization. Along with that, you will still have challenges to automate any of the EDI processes due to limitations in integration functionality of multiple systems into QuickBooks.

Moving to another ERP that can handle EDI orders for you is another choice to make, but it comes with a wide variety of downsides. First of all — ERP migration is incredibly risky, according to Gartner, 75% of all ERP change projects fail. Change management is difficult, and replacing your source of truth and the core of your business may be one of the most difficult changes of all. To add to this, it’s slow. The general rule of thumb we like to use when talking about ERP changeovers is to take whatever estimate of time you have to complete it, and add four months.

The final option, pursuing an EDI integration that works natively with QuickBooks is by far the best for most companies, especially those dipping their toes into the waters, or finding themselves frustrated with manually inputting orders.

What makes EDI integrations for QuickBooks so good — and what you should be looking for. 

What your company really needs is a way to bridge the gap between its growing success and its order management capabilities, especially surrounding EDI. This is where integrations come in. They act as a way to expand the functionality of your QuickBooks package without having to completely upgrade it, and provide a way forward without having to change out the core of your company.

A good EDI integration allows your company to seamlessly and automatically handle EDI orders instead of manually inputting data. It should simplify every step of your order management process so you can focus on what really matters, growing your business and making sure that your products are getting out the door.

When you’re looking for an EDI integration solution, there are four main components that you want to look for. The solution should allow you to:

  1. Perform order management from a single platform, instead of having to swivel between portals.

  2. Reduce or remove most of the manual labor from EDI order management.

  3. Push and pull data directly from and to the EDI systems of your trading partners — simplifying communication and order management.

  4. Integrate into your other business systems such as logistics that allow further hands free automation of your EDI order management processes.

Of the four, being able to push and pull data is the most important. There are some solutions that only allow your company to pull data, and not to push it out. This means that your company might be receiving EDI orders directly to your QuickBooks, but your team will still have to manually fill out the orders on other platforms to communicate.

In other words, if you’re not both sending and receiving data, you’ve only fixed half your problem.

If you’re able to both push information from and pull information into your QuickBooks, you can automatically update EDI orders as they go through each stage of your company’s order management process. 

By automatically updating, you reduce the amount of time your team needs to babysit each order, reduce the chance of mis inputted data causing issues for your company, and make sure that you won’t get penalized by the companies running the EDI system for failures to report.

Read more about the benefits of ERP integration here. 

OrderEase provides this kind of bidirectional EDI integration for QuickBooks users everywhere. We help to make sure that your ordering processes are as seamless as possible by automating the entire EDI process from first point of contact, to invoicing. As a single platform, we can manage all of your orders from any platform — providing you with a single space to work, while embracing the technology that you are already using.

To provide you an example of how easy EDI ordering becomes with our QuickBooks integration, read this sample workflow below:

  1. Your customer creates an EDI order for a box of 1,000 widgets.

  2. OrderEase automatically picks up the order from the trading partner’s EDI portal, confirms it and passes it through to QuickBooks.

  3. As your order moves through the fulfillment process, OrderEase tracks it and sends out regular updates via EDI transmissions without the need for your team to log into a portal.

  4. If you have shipping software like ShipStation, your information is sent into that integrated solution simultaneously. When the shipment is generated, OrderEase uses the tracking information to generate an Advanced Shipment Notice (ASN) EDI transmission and send it to your trading partner.

  5. When the shipment is sent, the status of your order is changed to “shipped” which triggers an invoice generated from QuickBooks. This invoice then sends to OrderEase, which converts the invoice to the 810 EDI format and sends it on to your trading partner.

  6. That’s it. It’s a hands off experience which can be customized to whatever level of oversight that your organization requires.

At the end of the day, you want to be able to keep a system that is largely working for you, and is well understood by your team — just with the addition of the specific functionality you need. You want an integration that embraces your current system instead of replacing it, and you want to reduce the amount of work that goes into managing EDI orders.

OrderEase does that. 

Visit our QuickBooks integration page today to learn more. 

Alternatively, reach out to us and book a discovery call today to see how you can transform how your company manages EDI orders. 

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