Electronic Data Interchange (EDI) Solutions Market: Innovation - a Key Survival Strategy

Amid the routine chaos of handling an extensive trading network, monitoring transactions, and communicating through multiple media, electronic data interchange (EDI) solutions emerge as a digital panacea to the ineffectual manual process for enterprises of all scales. As technology-enabled businesses are keen on acquiring the early slice of innovation, electronic data interchange solution providers entail a movement towards converging applications of Blockchain with EDI to integrate security in core business processes.

With high expenditures on R&D activities, future-pervasive technologies - Internet of Things (IoT), Artificial Intelligence, and Machine Learning - are likely to offer new tangents to the existing course of EDI. As the 'need for automation' becomes the need of the hour for businesses, digital business models will become more pervasive and demand EDI solutions to facilitate paperless communication in the future.

Sensing the incremental growth opportunity for the electronic data interchange solutions market, Transparency Market Research (TMR), in its latest study, brings actionable intelligence to the fore, so as to equip decision-makers with reliable insights and aid them in making their next successful business moves.

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Tracing the Evolution of the EDI Solutions Market

Similar to numerous information technologies, electronic data interchange solutions trace their advent for addressing the needs of military logistics to the early 1950s. However, through the journey - from nascent to mature - electronic data interchange solutions underwent transmutation in terms of adapting to specific entrepreneurial needs to simplify the information exchange process by blurring physical borders.

In 2018, the sales of electronic data interchange solutions recorded a value of ~ US$ 22.9 Bn, and are likely to spectate lucrative growth opportunities through to 2027. In recent times, as consumers think digital to suit their shopping needs, effective communication becomes integral for achieving a streamlined distribution network with the ease of supply chain management. The emergence of cloud-based EDI solutions further erases the physical boundaries, and offers access to thousands of suppliers, retailers, warehousing managers, and distributors operating on a global level.

Service providers scramble towards the development of web-based, Blockchain-integrated, and cloud-based EDIs that outweigh traditional EDIs that lack collaboration, workflow, and search engine features. The ease of handling every level of business communication at a single stop has been gaining ground in the logistics industry. As business success significantly relies on e-Commerce channels, the retail, healthcare, and automotive sectors are likely to remain at the forefront of the adoption of EDI solutions in the future.

Large Enterprises – A Key Segment to Focus on

With the perpetual rise in the online shopping behavior of consumers, logistics service providers are making headway towards next-day or same-day delivery of products to hold on to a distinguished position in their domain. However, numerous shipments and distribution points add up to the complexity level, which steers the shift towards effective communication solutions such as EDI.

The retail industry bears a majority of brunt of demanding consumers, which incites their quest for EDI solutions to reduce operational costs and drive a high grade of process efficiency. However, the automotive industry has also been an early adopter of EDI solutions for achieving uninterrupted exchange of business documents across various levels, ranging from car manufacturers to suppliers and end users. Owing to the global nature of the automotive landscape, the penetration of EDI tools is high in large as well as mid- and small-sized enterprises.

Large enterprises remain at the forefront of the adoption of electronic data interchange solutions, as they capitalize on opportunities to enhance the efficiency of their business processes and reduce overhead costs. However, mid- and small-sized enterprises are gradually showing a risk appetite to exhibit an endurance to wait for a long payback period for their high investments.

Though the EDI solutions market stands at a mature stage, a shift away from paper is still an uphill climb for numerous companies. Additionally, the initial deployment cost makes these solutions unattractive for adoption, and lack of competent staff further demands a training budget, which sums up to a high initial cost.

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EDI Solutions Market - Key Winning Strategies for the Long Run

Broaden Cloud-based EDI Solution Offerings

As enterprises are keen on reducing process complexity and decreasing the downtime of processes, the adoption of cloud-based solutions remains a key trend. As service providers raise their development bars, cutting-edge cloud-based EDI solutions are surfacing, which have been offering significant opportunities to the supply chain market. When cloud-based EDI solutions are combined with other technologies, the security, reliability, and simplicity of processes increases, while their deployment cost reduces as compared to a typical EDI project. Service providers can intensify the development of electronic data interchange solutions to achieve better shots at closing business deals.

Integrate EDI Solutions with Novel Technologies

The EDI solutions market is at a mature stage, where typical solutions are already a part of legacy infrastructure and innovation has become a growth synonym. Service providers can expend their efforts in the integration of EDI solutions with existing and surfacing technologies such as SAP, artificial intelligence, machine learning, and Blockchain to unlock new meadows of application.

Prioritize Solutions for Retail Industry

One key industry that service providers can focus on to raise their revenue bars is the retail industry. Consumer choices have been gradually evolving and their demand for instant services have been growing more than ever before. Service providers can leverage the potential of the retail industry by developing segment-centric solutions to scramble towards a high market share.

Electronic Data Interchange Solutions Market – Competition Matrix

The electronic data interchange solutions market operates amid a high degree of consolidation, with leading, prominent, and emerging companies at play. The integration of innovative EDI solutions remains a key focal point for these players. However, high investment at the very first step of establishment, coupled with a loyal consumer base of leading players narrows the entrance for new players.

Leading players account for 45-55% of the total market share, and collaboration on the development of EDI solutions remains their distinguished strategy to acquire new consumers and retain the existing ones with value-added services. For example, BTC AG enriched its BTC connect toolbox by adding SAP to it, with the underlying aim to broaden its portfolio and tap more market segments, including the retail market, supply chain management, and logistics and transportation. However, prominent and emerging players account for a small market share of 10-20% and <10%, respectively.

Prominent players focus on the development of advanced technologies by leveraging the prowess of next-gen technologies such as machine learning, analytics support, and artificial intelligence. For instance, in April 2019, McKesson Corporation announced a collaboration with Google to develop advanced applications and products.

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Analysts’ Inference of the EDI Solutions Market

Authors of the report infer that, the electronic data interchange solutions market will grow at an impressive pace, and record a CAGR of ~ 8.5% during the forecast period of 2019-2027. An investment made towards the development of cloud-based EDI solutions is likely to offer high returns, as 'anywhere, anytime' access offers service providers the ease to communicate efficiently with numerous traders. Manufacturers can target opportunities ascending from e-Commerce activities on account of high transaction volumes in the retail industry.

The demand for EDI solutions has been growing in the automotive industry to simplify the transfer of documents across the workflow, which has been offering lucrative opportunities to Asia Pacific region. Though the penetration of EDI solutions is high in large enterprises, mid- and small-size enterprises are exhibiting a high potential of adoption, which service providers can capitalize on to advance their businesses. However, the high installation cost and a long payback period of EDI solutions could cause reluctance among enterprises with limited budgets on innovation.

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Global Electronic Data Interchange (EDI) Solutions Market: Overview

  • According to a new market report pertaining to the global electronic data interchange (EDI) solutions market, published by Transparency Market Research the global electronic data interchange solutions market is projected to reach value of ~ US$ 47 Bn by 2027.
  • The electronic data interchange solutions market is projected to expand at a CAGR of ~ 8.5% from 2019 to 2027.
  • Growth of the market can be attributed to increasing innovations and technological advancements.
    Over the forecast period, Asia Pacific is anticipated to grow rapidly in the EDI solutions market, at a CAGR of ~ 9%.
  • In terms of revenue market share, the EDI solutions market is dominated by North America, followed by Europe.
  • In the electronic data interchange solutions market, the cloud-based EDI software segment was valued at ~ US$ 2.1 Bn in 2017, and is expected to reach ~ US$ 4.9 Bn by 2027, expanding at a CAGR of ~ 9% during the forecast period.

Increasing Spending by Enterprises on Integration of Advanced Technologies with EDI

  • Organizations are embedding more advanced technologies and trying to provide unique EDI solutions as compared to their competitors, due to the increase in competition among electronic data interchange solutions providers. This is helping the electronic data interchange solutions market increase its operational efficiency and provide improved customer services.
  • Blockchain is an emerging technology that provides unique algorithms for transferring documents securely in the electronic data interchange solutions market. Extensive demand for integration of blockchain in EDI is expected in the near future, due to considerable threat while transferring data online.
  • The new generation of advanced technology and transferability of data continues to drive the demand for EDI platforms. Consequently, it is expected to create huge growth opportunities for the EDI solutions market in the forthcoming years.
  • Technological advancements in security of data and technology are opening up a wide range of possibilities across the traditional qualitative-quantitative spectrum of market research. Several technological advancements in artificial intelligence and machine learning are significantly impacting organizations across industries, thereby driving the demand for electronic data interchange solutions. This is propelling the growth of the EDI market across the globe.

Electronic Data Interchange Solutions Market: Taxonomy

  • The global electronic data interchange solutions market has been segmented in terms of type, enterprise size, industry, and region.
  • Based on type, the EDI solutions market has been classified into EDI VAN (value-added network), EDI software, and EDI-as-a-Service (Outsourcing/Managed Services). The EDI software segment has been sub-classified into on-premise and cloud-based.
  • In terms of enterprise size, the market has been segmented into large and small & medium enterprises.
  • Based on industry, the market has been classified into healthcare, manufacturing, retail, automotive, telecom & IT, transportation, logistics (supply chain), and others (construction etc.). The logistics (supply chain) segment has been sub-divided into warehousing, freight forwarding, and last man delivery.

Electronic Data Interchange Solutions Market: Regional Outlook

  • In terms of region, the global electronic data interchange solutions market has been segmented into North America, Europe, Asia Pacific, the Middle East & Africa, and South America.
  • North America is expected to dominate the electronic data interchange solutions market during the forecast period. Asia Pacific is expected to see increasing growth in the global electronic data interchange solutions market, with China and India being the major markets in the region.
  • The electronic data interchange solutions markets in the Middle East & Africa, Europe, and South America are also expected to expand rapidly during the forecast period.

Electronic Data Interchange Solutions Market: Competition Dynamics

The research study includes profiles of leading companies operating in the global electronic data interchange solutions market.

Key players profiled in the report include

  • BTC AG
  • Cleo
  • CovalentWorks 
  • Dell Inc. 
  • McKesson Corporation.
  • Salesforce.com Inc.
  • SPS Commerce 
  • IBM Corporation
  • GE Healthcare
  • True Commerce, Inc.

Electronic Data Interchange (EDI) Solutions Market

Transparency Market Research (TMR) recently published a research report on the electronic data interchange (EDI) solutions market, which offers a detailed analysis for the forecast period of 2019-2027. The research report provides key insights into the electronic data interchange solutions market by assessing the relevance and impact of significant drivers, restraints, threats, and opportunities. The global study takes a systematic approach to analyze the historical and future growth trends for the EDI solutions market. With the help of the information covered in the research study, readers and stakeholders will be able to gauge the future growth trajectory of the electronic data interchange solutions market.

The research report offers a blend of qualitative as well as quantitative data that is instrumental for stakeholders in devising sustainable growth strategies. The wide scope of the research report also includes Porter’s Five Forces Analysis, PESTEL Analysis, and Ecosystem Analysis. In addition, the EDI solutions market report offers an in-depth assessment of the competition intensity prevailing in the market. The market study profiles key players operating in the electronic data interchange market, along with their revenue, strategies, and notable developments.

Electronic Data Interchange (EDI) Solutions Market - Segmentation

In order to assess the EDI solutions market on a microscopic level, our analysts bifurcate the market into key segments. Key segments of the electronic data interchange solutions market include – type, enterprise size, industry, and region. Based on these segments, a thorough analysis of the trends influencing the EDI solutions market can be carried out.

Type

Enterprise Size

Industry

Region

EDI VAN (Value-added Network

Large Enterprises

Healthcare

North America

EDI Software

Small & Medium Enterprises

Manufacturing

Europe

EDI-as-a-Service

 

Retail

Asia Pacific

 

 

Automotive

Middle East and Africa

 

 

Telecom & IT

South America

 

 

Transportation

 

 

 

Logistics

 

Electronic Data Interchange (EDI) Solutions Market – Key Questions Answered

This exclusive study on the electronic data interchange solutions offers an estimation of the regional as well as global landscape. The evaluation of the EDI solutions market in terms of Y-o-Y growth and basis point share analysis will help stakeholders in the market understand the key opportunities to sustain and broaden their reach in the electronic data interchange solutions market.

Authors of the report addresses key concerns of EDI solutions market players. Some of the key questions answered in the report include:

  • What are the key strategies followed by the leading players operating in the electronic data interchange solutions market?
  • Which region will offer high returns on investment in the EDI solutions market?
  • Which are the industries where the adoption of electronic data interchange solutions is high?
  • What are the threats and opportunities present in the electronic data interchange solutions market?
  • What are the opportunities available for players in the EDI solutions market?
  • Which enterprise is likely to fuel the adoption of electronic data interchange solutions?

Electronic Data Interchange (EDI) Solutions Market – Research Methodology

With a broad scope and stratified research methodology, this exclusive study aims at serving the overall research requirement of stakeholders. For approaching the size of the electronic data interchange solutions market, our analysts conducted a detailed primary and secondary research. Interviews with industry experts, business heads, key market players, and opinion leaders were conducted. In order to conduct secondary research, the study of annual reports of each company, e-Commerce websites, journals, government websites, and paid sources such as Bloomberg, Hoovers, and Factiva was carried out. Through a systematic approach, sales through past trends, and technological trends, the adoption of EDI solutions in various industries and regions are estimated.

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