What is an EDI 810 for Invoice Transactions?

While we spend a lot of time discussing paper documents and PDFs, there’s a newer wave of documents that are much more standard than paper...EDI. Electronic Data Interchange documents are exactly what they sound like: a strictly formatted file that allows for the speedy and accurate transfer of data between companies.

But, as with all standards, there are variations.  And it’s the variations that make processing difficult.  

At BIS, we have experience translating, validating, and correcting EDI files.  One of our clients is processing billions of data elements every day — and that data is either going into or out of an EDI file format.

• What is an 810?
• An example of EDI 810
• Video of 810 processing and conversion
• How to read an EDI 810
• Benefits of EDI 810
• Solutions for processing 810s
• How to use EDI 810

What is an 810?

An EDI 810 Invoice is an electronic invoice document sent by a seller to a buyer to ask for payment based on the terms in previous documents (probably an EDI 850). EDI 810 is a specific type of electronic file that's formatted with American National Standards Institute (ANSI X12) standards.

ANSI is a non-profit entity that oversees EDI formats in the United States. 810 EDIs can be used by EDI software, or other software that can ingest data files, like Grooper software.

This type of file can be used across many different order types, and includes invoice information like:

• Invoice number
• Amounts due
• Dates
• Vendor and buyer names
• Line items of services or goods purchased, like unit prices
• Tax information, like tax rates
• Discounts
• Shipping costs

An EDI is normally sent along with other EDI files, like EDI 850 (which are for purchase orders) and EDI 856 (for advanced shipping notices). With these three types of files, buyers can match quantities ordered and costs to ensure there are no missing goods or overcharges.

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EDI 810 Format Example and What it Means

Data in an EDI 810 file can be viewed in two ways:

1. As a version that's readable by humans
2. As a raw data version

Here is what the raw EDI data version looks like, which is ingested into EDI software and then exported to downstream business systems like ERP solutions.

How to Read EDI 810 Code 

But what does all this EDI code mean? How do you decipher it? Here is a breakdown of what each section means in human terms.

What are the Benefits of EDI 810?

Using EDI 810 brings many benefits to both the buyer and seller throughout trading partner transactions. More security, improved efficiency, faster and easier to work with, drastically reduced manual errors — there's a lot to like.

The benefits include:

• Speed

By using an electronic file, suppliers/vendors save a lot of time by automatically matching an 810 EDI against electronic purchase orders (EDI 850) and shipping documents (EDI 856).

This fast reconciliation helps vendors receive payments and revenue faster.

•  Eliminated Errors 

Even the best human workers make errors in manual data entry. Sometimes, we make a lot of them.

However, using EDI 810 virtually eliminates manual errors, as accounting department employees no longer have to key in data from invoices to business software systems manually. This applies to departments in buyer and seller companies.

Sometimes these manual data entry errors can create problems in the procurement process, which slows the entire process and delays payments. But EDI 810 prevents these errors and improves payment times.

•  Improved Security  

EDI 810 is far more secure than other methods of invoicing and payments, like paper, e-mail, or faxed documents. That's because 810 can be sent from vendor to buyer through secure EDI protocols like SFTP or HTTP that include user authentication and even encryption.

These methods provide a highly safe and confidential exchange of payment information.

• Buying Transparency

The entire purchasing / procurement lifecycle can be easily accessed and examined by using EDI documents.

The entire process begins when EDI 850s are created as purchase orders, then as EDI 855 purchase order acknowledgments, and continues when an 846 is issued as an Inventory Inquiry document and an 856 as an Advance Shipping Notice document. The process is completed with an 810 EDI as an order to purchase the goods or products.

Companies can have a great transparent overview of buying decisions and their vendors by having full data available electronically, in a standard format, and in one location.

What are Good Solutions for Processing EDI 810 Documents?

While most people assume that once you adopt EDI in your business, your automation journey is over. But that's normally not the case.

We’re only going to talk about EDI 810s here, but Grooper can import, validate, correct, and export any format of EDI file.

In the 2023.1 version of Grooper, we created the ability to import EDI files in two ways:

1. As a schema
2. As an actual document for invoice processing

Similar to how Grooper would import a text file (a .CSV, for instance), this software now allows you to map fields from the EDI file to Grooper fields.

It also sets up the entire data model once you import the EDI schema — as straightforward as it can be!  However, validating an EDI file is tough for humans, so Grooper can present the data as a validation screen in a user-friendly display and then put the corrected data where it needs to go before creating the correct file for downstream processing.

And it's easy to manipulate the outgoing file format if your EDI format is slightly different than the ANSI standard.  We have many clients with this issue, and the ability to normalize their EDI documents automatically without specialized software has been a huge success. 

How Do You Use EDI 810 Invoices? 3 Steps

Step 1:  An EDI 810 document is traditionally sent by a vendor (like a manufacturer or distributor) to a buyer (like a retailer) after the order has shipped out to that buyer.

The 810 document verifies that the goods or services ordered have been delivered, and it asks for payment from the buyer to complete the order transaction.

Step 2:  The buyer leverages one of the 810's main benefits: the fact that an EDI 810 is organized into different data segments. By accessing these data segments, the buyer's EDI or EDI integration software can rapidly import this invoice information into data systems or downstream software.

Buyers save significant time by avoiding the painstaking work of manually keying in data from paper-based invoices into data systems.

Step 3:  The buyer can certify receiving the order by sending an EDI 997 Functional Acknowledgement document back to the vendor. Once invoice data has been matched correctly against the electronic purchase order and shipping document, the 810 EDI can be sent to the accounts payable department in order to send a payment to the vendor.

The buyer can then send an EDI 820 Payment Order or Remittance Advice Document back to the vendor to relay information about the payment just sent out.

810 EDI Specifications

This X12 Transaction Set contains the format and establishes the data contents of the Invoice Transaction Set (810) to use in the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide an industry practice related to the billing for goods and services provided to customary and established businesses.

Sources

Accredited Standards Committee X12. ASC X12 Standard [Table Data]. Data Interchange Standards Association, Inc., Falls Church, VA. http://www.x12.org