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    EDI 855: Purchase Order Acknowledgment

    July 6th, 2023

    What is an EDI 855?

    Efficiency and accuracy are crucial for smooth transactions and seamless collaboration between trading partners. One way to achieve this is using Electronic Data Interchange (EDI)

    EDI 855 (Purchase Order Acknowledgement) is an ANSI X12 transaction set that confirms or acknowledges a purchase order (PO) received by a supplier. Suppliers typically send it in response to an EDI 850 (Purchase Order) transaction from a buyer. EDI 855 provides vital information about the supplier’s ability to fulfill the order, including item availability, expected delivery dates, pricing, and any changes or discrepancies in the original order. 

    Difference between EDI 855 and EDI 997

    The main differences between EDI 855 and EDI 997 (Functional Acknowledgment) lie in their respective purposes and the types of information they convey. 

    While both EDI 997 and EDI 855 are acknowledgments, they serve different purposes and provide different information. The EDI 997 is a general acknowledgment confirming the receipt and validation of any EDI transaction. On the other hand, the EDI 855 is a specific acknowledgment for POs, acknowledging their receipt and providing additional details related to the order. Generally, the buyer sends an EDI 997 acknowledgment after receiving an 855 EDI document, indicating the receipt of the purchase acknowledgment.

    How to Use EDI 855

    If you are a supplier or a vendor receiving purchase orders electronically, then the EDI 855 is crucial for maintaining efficient communication with your customers. It allows you to acknowledge receipt of the order and confirm its details promptly. It also allows you to inform the buyer about any changes or issues. 

    Here’s what you need to know to use EDI 855 effectively: 

    1. EDI Capabilities: You need to have the necessary EDI capabilities in place to send and receive electronic documents. This includes having the appropriate software or EDI platform that can generate and process EDI 855 transactions. 
    2. Trading Partner Agreements: Establishing trading partner agreements is crucial for successful EDI implementation. You need to collaborate with your customers and trading partners to define the specific EDI standards, document formats, communication protocols, and other technical requirements. This ensures that both parties are aligned and can exchange EDI documents seamlessly. 
    3. Mapping and Integration: You also need to properly map EDI 855 transactions to your internal systems to enable smooth integration with your order management or enterprise resource planning (ERP) system. Mapping involves transforming the EDI data into a format that your internal systems can easily process and understand. Depending on the complexity of your systems, you may require expertise in EDI mapping or assistance from an EDI solution provider. 
    4. Testing and Validation: Prior to implementing EDI 855 in a production environment, you should conduct thorough testing and validation. This involves exchanging test EDI transactions with your trading partners to ensure the accurate transmission and interpretation of data. 
    5. Compliance with Industry Standards: It’s also important to adhere to industry standards when using EDI. The most common standard for purchase order acknowledgments is ANSI ASC X12. Compliance with these standards ensures consistency, interoperability, and smooth communication across the supply chain. 

    Components of an EDI 855 file

    An EDI 855 file consists of several segments and elements that contain specific information. This is what an EDI 855 file normally looks like: 

    EDI 855 Sample File

    Note: This is just for reference. It might not contain all the information typically included in an EDI 855 file. 

    Enjoy Frictionless B2B Data Exchange With Astera EDIConnect

    Here are the key components you can find in an EDI 855 document: 

    Header Segments 

    • Interchange Control Header (ISA): Contains sender and receiver identification, control numbers, and interchange-related information. 
    • Functional Group Header (GS): Identifies the functional group and provides control information. 

    Transaction Set 

    • Transaction Set Header (ST): Indicates the start of the transaction set and provides a unique control number. 

    Purchase Order Acknowledgment 

    • Purchase Order Acknowledgment (BAK): Acknowledges the receipt of a purchase order and provides details such as acknowledgment type, dates, and the original purchase order number. 

    Item Details 

    • Item Physical Details (PO4): Provides information about individual items within the purchase order, including item quantity, unit of measure, and item description. 

    Line-Item Acknowledgment 

    • Line-Item Acknowledgment (ACK): Confirms whether each item in the purchase order is acknowledged or not and may indicate any changes or discrepancies. 

    Date/Time Reference 

    • Date/Time Reference (DTM): Specifies relevant dates related to the acknowledgment, such as the acknowledgment date. 

    Trailer Segments 

    • Transaction Set Trailer (SE): Indicates the end of the transaction set and provides a count of the segments within the transaction. 
    • Functional Group Trailer (GE): Provides control information for the functional group, including a count of the transactions within the group. 
    • Interchange Control Trailer (IEA): Indicates the end of the interchange control structure and provides a count of the functional groups within the interchange. 

    Use-case Example

    Let’s consider a practical example to illustrate how the EDI 855 transaction process works. Suppose a buyer sends an EDI 850 to its supplier. Upon receiving the purchase order, the supplier generates an EDI 855 in response and sends it back to the buyer. EDI 855 confirms the receipt of the order and includes any necessary changes or modifications requested by the supplier. 

    If the supplier needs to make changes to the purchase order, they will send the customer an EDI 860 (the Purchase Order Change Request) transaction. This document communicates the modifications to the original purchase order, such as revised quantities, pricing, or delivery dates. 

    Benefits of EDI 855

    • Improved Efficiency: EDI 855 streamlines the acknowledgment process, reducing manual errors and eliminating the need for paper-based acknowledgments. This enhances efficiency and saves time for both the buyer and the supplier.
    • Enhanced Visibility: With EDI 855, both parties have real-time visibility into the status of their orders. This allows for better planning, inventory management, and proactive communication.
    • Reduced Discrepancies: By electronically exchanging accurate and detailed order acknowledgments, EDI 855 reduces the chances of misunderstandings or discrepancies between the buyer and the supplier.
    • Faster Order Fulfillment: The prompt acknowledgment of a purchase order through EDI 855 enables the supplier to start processing the order immediately, resulting in faster order fulfillment and improved customer satisfaction.

    How Astera EDIConnect helps

    Leveraging technology to automate and optimize processes is crucial in today’s fast-paced business environment. The EDI 855 transaction set simplifies order management by providing a streamlined method for suppliers to confirm the receipt of purchase orders and communicate changes or updates. However, you need a robust EDI solution, such as Astera EDIConnect, to take full advantage of EDI. 

    Designed to simplify and accelerate the exchange of EDI documents, EDIConnect is an enterprise-grade EDI solution that supports the building and parsing of all ANSI X12, EDIFACT, and HIPAA transaction sets without writing a single line of code. With EDIConnect, you benefit from its built-in: 

    • Translator 
    • Transaction Builder 
    • Validator 
    • Repository Manager 
    • Partner Manager 
    • Automation and Process Orchestration 
    • Job Scheduler 

    It also enables you to integrate with your trading partners seamlessly with its intuitive UI, automated mapping, and support for multiple communication protocols. Ensure efficient processing of EDI transactions and reduce manual effort using EDIConnect.

    Find Out How Astera EDIConnect Simplifies EDI 855 Transactions

    Authors:

    • Irfan Ahmed
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