EDI 850
Purchase Order Specifications
Learn about the EDI 850 by reading the guide below.
If you need to send or receive EDI 850s, contact our team today.
What is an EDI 850?
The EDI 850 transaction, also known as an EDI Purchase Order or EDI PO, is a critical and widely used document that notifies the receiving party of an order's details, specifically describing the expectations for the order. The document is sent preceding a business purchase. Many major retailers require it to be sent depending on the industry or trading partner.
An EDI 850 allows the sender to specify information like specific products, quantities, prices, and delivery details. And whenever an organization requires goods or services from one of it's suppliers, the EDI 850 is the first step in that purchase order process.
Moreover, the EDI 850 enables businesses to ensure the automation and security of their purchase order processes. Trading partners can safely share sensitive data like pricing because EDI transactions are encrypted in transit. This reduces manual errors and overall speeds up communications in the supply chain.
What is an EDI 850 Made Up of?
On a given order, the EDI 850 document contains all the necessary details required by the vendor, so they can properly receive, process, and fulfill the order. This includes:
- Purchase order number
- Purchase order date
- Seller and buyer information (names, addresses, contact information)
- Item details (item numbers, descriptions, quantities, prices)
- Delivery information (ship to address, delivery date, carrier information)
- Payment terms
- Discounts and/or taxes
- Total order amount
- Additional comments or delivery instructions
The American National Standards Institute (ANSI), a non-profit organization that oversees U.S. EDI formats, established the x12 format, which is used in every EDI 850 document. There are over 300 x12 standards in use today. These x12 standards determine the data required in every EDI 850 transaction to ensure data accuracy and security.
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EDI 850 can be presented in two formats:
A human-readable version and a raw data version. The raw EDI data, which is displayed in the example below, must be translated by your business system (ERP) to initiate the fulfillment process.
ST*850*0596~ BEG*00*NE*LCS209752**20191217~ N1*ST*CLARENDALE OF ADDISON*92*2032~ N3*1651 WEST LAKETREET~ N4*ADDISON*IL*60101~ PER*OC*JOE PECONIO*TE*6307495699~ PO1*1*1*CA*27.55**VN*231217~ CTT*1~ AMT*TT*27.55~ SE*10*0596~
How is an EDI 850 Used?
The 850 EDI document is one of the many digital EDI documents sent from business to business throughout the supply chain. Used by businesses that communicate via EDI.
The primary use of the EDI 850 is to initiate an order with a vendor (a seller). When the EDI 850 is received, the document provides all the needed information for the seller to fill the order. This EDI document is used in countless business networks, throughout many industries, and in their supply chains.
Retailers, wholesalers, manufacturers, etc., and any other sector where goods are being bought and sold, cannot be done without the EDI 850 Purchase Order.
EDI 850 Specification
This X12 Transaction Set contains the format and establishes the data contents of the Purchase Order Transaction Set (850) for use within the context of an Electronic Data Interchange (EDI) environment. The transaction set can be used to provide for customary and established business and industry practice relative to the placement of purchase orders for goods and services. This transaction set should not be used to convey purchase order changes or purchase order acknowledgment information.
Sources
Accredited Standards Committee X12. ASC X12 Standard [Table Data]. Data Interchange Standards Association, Inc., Falls Church, VA. https://x12.org/index.php/products/transaction-sets
EDI 850 Compliance
To be EDI compliant when accepting an EDI 850 from a trading partner, it is mandatory to respond with other specific EDI documents.
These transactions include:
EDI 810 Invoice - replaces the traditional paper invoice
EDI 856 Advanced Shipping Notice - describes the contents of each shipment
EDI 997 Functional Acknowledgement - confirms receipt of the EDI 850
EDI 855 Order Acknowledgment - confirms you can meet the requirements of the purchase order
EDI 860 Order Change Request - requests an update to the details on the original purchase order
Cleo Helps Businesses Make EDI Their Super Power
See how our EDI solutions streamline your order processes below.
How Cleo Simplifies the EDI 850 Transaction Exchange
| Step 1. Once, you've received an EDI 850 Purchase Order from your trading partner (let's say Clarendale of Addison in this example), Cleo automatically creates and sends an EDI 855 Purchase Order Acknowledgment to your trading partner without a blink. |
| Step 2. Once the 850 is acknowledged and you have shipped the order, Cleo is ready to generate and send an EDI 856 to your trading partner, to inform them of the contents of your shipment. |
| Step 3. Cleo Integration Cloud generates an automated EDI 810 invoice and sends the invoice to Clarendale of Addison as a receipt for goods purchased. |
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Step 4. Your trading partner sends an EDI 820 Order/Remittance to send the terms of the impending payment for goods purchased. |
Modern EDI Translation with Cleo
Choose the EDI Integration package that best fits your business:
1. Create and deploy your own integrations using Cleo's intuitive, self-service design platform.
2. Utilize Cleo's EDI managed services team to design and build your integrations.
3. Blend our EDI expertise and your business knowledge together in any manner that suits your use case.
