Transaction Type: Purchase Order

EDI Code: 850

Article Link: http://help.truecommerce.com/en/articles/9264209-edi-purchase-order-850

An EDI 850 is a type of electronic data interchange transaction set that contains details about an order. Also known as an electronic purchase order, an EDI 850 is usually sent to a vendor as the first step in the ordering process. An EDI 850 can be used both for a single purchase, for recurring purchases, or to delete or amend an order as specified by the buyer.

EDI 850 documents follow the x12 format set by the American National Standards Institute (ANSI), a not-for-profit organization that regulates EDI formats in the U.S.

The EDI 850 transaction set provides the same information as a paper purchase order document. These include:

EDI 850 documents are usually sent from the buyer to the seller to initiate an order. After receiving an EDI 850 purchase order, the vendor confirms receipt with an EDI 997 Functional Acknowledgement and/or 855 Purchase Order Acknowledgement. The vendor may also respond with an EDI 810 Invoice to convey invoice details.

Most buyers will have specific EDI requirements that indicate which documents must be exchanged, and when. For example, a buyer may request an 855 Purchase Order Acknowledgement within a specified time frame after sending an EDI 850 purchase order. The buyer may also require an EDI 856 Advance Ship Notice previous to the shipped order arriving at the delivery address.

While an EDI 850 document contains the same information as a paper purchase order, this order method offers additional benefits for both buyers and sellers.

In general, EDI documents are securely encrypted in transit, allowing trading partners to send sensitive data such as pricing and contact information safely. Using an EDI 850 also helps to streamline order processing, so sellers can optimize their business operations, and buyers can receive their goods quickly. For example, when an EDI 850 document is received by the seller’s business system, automated processes can validate and verify the information, flagging any incorrect or missing data. This lets the seller quickly identify order issues and resolve those with the buyer.

Upon receipt of EDI 850, the seller’s EDI software translates the document into a translated format, which can then be input, automatically or manually, into their ERP system. EDI workflows require response documents like the EDI 997, to validate that the EDI transaction was received while the seller works on fulfillment.

EDI 850 can be viewed in two formats – a human “readable” version and a “raw” data version. The example below shows the raw EDI data, which is then translated by your business system (ERP) to begin the fulfillment process.