You're a freight industry professional looking for new and better tools to accelerate your operations and make jobs faster, safer, and more economical. As most people know, paper is becoming less prevalent in the transportation industry.
You've heard of electronic data interchange (EDI), but how does it benefit you and your industry?
Most EDI messages are created for shipment notifications, the status of POs, invoices, and other important information that can be transmitted electronically. The use of e-AWB is frequently more cost-effective than using paper air waybills.
Hence by using EDI messaging, there is no longer a need to key in data or print out documents manually. This helps save time and eliminate errors while also providing faster transmission times.
Read on as we cover EDI and the e-AWB and then delve into some of the critical benefits of EDI for Air Freight carriers.
EDI and Air Freight
The term EDI stands for Electronic Data Interchange, which is exchanging data between two or more parties. It is a way to exchange data between two or more parties. So, in the case of Air Freight and e-AWB, it can be explained as:
- A shipment provider (seller) sends their shipment information to an e-AWB service provider using EDI standards.
- The shipping provider receives confirmation from the receiving airline via EDI that they have received their goods and are ready to pay for them.
Why Air Freight carriers are concerned with e-AWB
As a testament to the double-edged sword of being a first mover, DHL was one of the first companies to implement electronic air waybills (e-AWB) when they were introduced in 2010. Unsurprisingly, the additional work involved in introducing the new system has placed a significant strain on their profits. This is not to say that there are no rewards in being among the first movers – many handlers did see restructuring benefits and overall improved efficiency after implementing e-AWBs.
If you're a freight forwarder or an Air Freight carrier, you might be wondering why your company should be concerned with e-AWB. Why switch from the manual paper process to electronic?
Air Freight carriers are concerned about the International Air Transport Association's (IATA) new e-AWB requirements. To comply, you'll need to integrate with IATA's API.
However, API integration is complex and falls short of the e-AWB requirements. Instead, it would help if you took advantage of Electronic Data Interchange (EDI) – a powerful tool for complying with the IATA e-AWB requirements and can help you efficiently manage the process.
Why APIs don't meet the IATA requirements
- APIs are not always reliable.
- APIs are not standardized.
- APIs are not scalable.
- APIs are not always secure.
Further, APIs are expensive to use and maintain, particularly in large or complex environments like handling multiple carriers and locations, aircraft fleets, or managing interconnectivity with other systems (like ERP systems).
Are APIs bad?
We are not saying APIs are bad; they're not always the best option for e-AWB. They can be great solutions for other things.
APIs allow you to interact with another service or system by sending commands and getting responses. They typically use REST or SOAP protocols over HTTP(S) connections. Suppose you want to make an API request. As a result, you send up a URL along with some authentication credentials (usually your username and password), and the server returns some data as an HTTP response code—200 means everything went fine; 404 means something went wrong on their end; 500 means something went wrong on yours (it usually does).
Why Electronic Data Interchange is a trusted alternative to APIs for helping Air Freight businesses meet compliance
Electronic data interchange (EDI) is a secure and trusted way to exchange business documents between trading partners. If you're an Air Freight company, EDI can capture data from various applications and help reduce errors, improve transparency and reduce cost with efficient automation.
Why? With EDI solutions for Air Freight, companies can now move from traditional paper-based processes to digital ones that allow them to quickly transmit cargo information without worrying about transferring files or waiting for approval before sending the data.
APIs can make sense in specific scenarios, but they're not perfect. For instance, if you want to expand your business into a new country, you'll need to build a whole new API for them. These extra costs could be avoided by using an EDI system that can process data from multiple countries with no extra development effort required. This can save money otherwise spent on additional resources or IT staff dedicated solely to developing APIs.
The main takeaway is that there are plenty of advantages when choosing EDI over APIs for Air Freight companies looking to improve their compliance with regulations or simply gain more visibility into their supply chain processes.
The benefits of EDI for Air Freight
EDI (electronic data interchange) is a standard way of sending data between companies. It reduces paperwork, costs, and errors and offers increased security.
It's cost-effective
Because EDI eliminates the need for physical documents like paper bills of lading and air waybills. It means no printing or scanning, saving money on supplies like paper, ink, and toner cartridges.
It's secure
Because EDI is sent electronically with no physical copies being made, it is much harder to tamper with the information contained within them. Your company can rely on their reliability without worrying whether they could be falsified or otherwise altered before reaching you.
Why are some carriers not using EDI?
- Some air carriers are not familiar with EDI.
- Some air carriers are not prepared to invest in a new software solution.
- Some air carriers do not understand their current solution well enough.
Speed and accuracy
The main benefit of EDI is speed. You know how much time it takes if you've ever had to file a customs document manually. The process can be completed in seconds with EDI rather than hours or days. The same goes for receiving information back from your suppliers and customers—instead of waiting for them to send you a paper form that then needs to be checked and processed by the appropriate parties before being sent back again (and again), with EDI all data is transferred electronically so nobody has to spend any time on paperwork at all.
Another benefit of using electronic data interchange systems is accuracy—the software will automatically check for errors in formatting and spelling before sending your message out into cyberspace; therefore, it's less likely that there'll be any mistakes and much quicker processing times overall.
Improved cash flow
Electronic data interchange (EDI) is a way to electronically exchange business documents, such as purchase orders and invoices. EDI allows you to get paid faster.
You can receive your payment in three ways: by the hour, day or week; by the month; or by a year-long contract that includes monthly payments for each shipment delivered during this period. In other words, your customer can pay you when convenient for them—and that could be daily.
Increased visibility
You can monitor shipments in real-time on a single screen, which allows you to be more aware of shipping delays. You can also track shipments across different carriers and modes of transportation (air and ground). Finally, if your customers are located in multiple countries or speak other languages, EDI makes it easy to access information about their shipments.
A typical example of this would be an incorrect delivery address on an e-AWB (Electronic Air Waybill) which causes costly delays as it may result in late notifications of flight cancellations due to missing information from one trading partner – causing unnecessary stress for both parties involved but especially for customers waiting on deliveries.
In addition to being cost-effective by reducing errors through automation, EDIs also provide your business with real-time access to data, enabling you to make quick decisions without waiting days before receiving updates from suppliers or service providers like airlines, who often use EDIs themselves as part of their cargo tracking systems, so that warehouse personnel receives near real-time notifications about incoming shipments via email alerts sent directly from carriers when everything gets booked up onto an aircraft flight plan.
Why?
So if something goes wrong somewhere along the route then someone will let us know immediately upon arrival at the destination airport where our representative will pick up the shipment after landing safely.
Reduced labor costs
Reduced labor costs: Employee hours spent on data entry and organizing paperwork can be cut down significantly with EDI. EDI eliminates the need for manual data entry and speeds up the process by automating many of the Air Freight booking, tracking, and payment processing steps. This results in reduced labor costs and greater efficiency in your operations.
Reduced overtime costs: When employees have to stay late or come in on weekends because they don't have all of their paperwork done by 5 p.m. It's bad news for everyone involved. With an efficient process that allows you to submit shipment information at any time of day without worrying about missing a deadline or incurring penalties due to delays in processing, there's less reason for staff members to work past regular business hours.
EDI for Air Freight helps reduce errors, improve transparency and reduce cost with efficient automation
Secure, trusted, and standardized. EDI is a secure means of exchanging data electronically between trading partners. It's more cost-effective than manual processes for gathering information about shipment particulars, tracking shipments, and delivery status information.
EDI can capture data from various applications, including ERP/MRP systems, WMS systems, and inventory management software.
This gives Air Freight providers the flexibility to integrate their system with other companies' technology to share shipping documents in real-time for instant visibility into each transaction.
This also reduces errors on both sides because it removes human error from the equation altogether – no need for double checks or manual entry by employees who aren't always available during peak times or when they're busy performing other tasks – your business can save time.
To summarize
EDI is a powerful tool that enables Air Freight carriers to meet the IATA requirements for e-AWBs. With EDI solutions for Air Freight, you can easily integrate with airlines and share information about pickup, delivery, billing, and more. EDI can help your organization efficiently manage its electronic communications with airline partners, enabling it to comply with the IATA requirement for 100% e-AWB adoption.
When it comes to Air Freight, EDI is almost always the better choice. It's universal, it has something APIs can't replicate: a rich history of interconnectivity, giving and receiving data. In practical terms, this allows for true integrations between EDI-based companies and their partners. Learn how Remedi can help.
