850 Purchase Order

edi 850An EDI 850 Purchase Order is an electronic version of a paper Purchase Order. EDI stands for Electronic Data Interchange. A Purchase Order is sometimes also referred to as "PO". Companies use EDI to reduce the errors and costs associated with the manual keying of data, and to speed up the process of sending and receiving Purchase Orders.

A buyer will use the 850 Purchase Order to communicate to a supplier the specific items, price, and quantities they wish to have delivered. Shipping instructions will frequently accompany the purchasing information.

Most buyers will also want to receive a 997 Functional Acknowledgment back after the supplier receives the 850 Purchase Order. The supplier sends the 997 Functional Acknowledgment back to the buyer to indicate that they successfully received the Purchase Order. The next step is the for the supplier to pick and pack the items followed by shipping of the order.

Need to send / receive EDI 850 transactions?

CovalentWorks makes this process easy with MyB2B, which essentially handles all the work "behind the scenes" to automate the transaction flow between you and your customers.

EDI documents are sent and received electronically using a VAN. VAN stands for Value Added Network. Part of the EDI Purchase Order document will contain envelope information. The envelope information specifies which company is sending the document and which company is receiving the document. The sending and receiving companies are called trading partners because they exchange or "trade" the EDI Purchase Order and Functional Acknowledgments. Both the buyer and supplier will have an EDI system to process their EDI documents.

EDI is a mature electronic document format that has been carefully defined both by the companies that require their trading partners to use EDI and by standards bodies. The two recognized standards for EDI are ANSI X.12 and UN/EDIFACT. ANSI X.12 is by far the most widely used standard in the United States. UN/EDIFACT is more popular outside the United States, although it is used by US automotive manufactures.

Each EDI Purchase Order document will have data organized into segments and data elements. Each segment contains at least one data element. Each data element is a data field. Examples of data elements on the Purchase Order include vendor number, item, quantity, price per item, street address, city, state and zip code, just like on a paper purchase order. The standards bodies have allowed for every conceivable possibility for data on the EDI Purchase Order document. Any one company will use a small subset of the available choices within the ANS X.12 or UN/EDIFACT standards.

Each company that requires its suppliers to use EDI will have an EDI Guide or mapping document. The EDI Guide will specify each segment and data element, the allowable values for each, and the applicable business rules that must be followed. EDI guides are detailed and extensive. It is not unusual for an EDI Guide to be more than 100 pages long.

Other Common X12 EDI Transactions

Need to send barcode labels?

Ready-to-print GS1-128 (UCC 128) barcode shipping labels are generated from both the MyB2B and B2BWorks EDI services, or from most file formats including CSV, Excel, X-12 and EDIFACT EDI, XML,text and custom format files.

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EDI Solution Comparison

Comparison Item




Turnkey solution ✓* ×
Web-based software included ×
Web-based portal × ×
Interfaces to other systems Optional ×
IT support included × ×
Transaction mapping ✓** ✓** ×
GS1-128 bar code labels ×
Trading partner testing ×
EDI VAN, AS/2, FTP ✓***
Training ×
Internet access from anywhere
Unlimited number of users
Month to month agreement
Free U.S. based support

*IT support required during testing for B2BWorks.

**MyB2B and B2BWorks include mapping for all transaction types for any partner in the world.

***EDI VAN service is included at no charge with both MyB2B and B2BWorks.

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    Cher Gray-AlderferController, Christine Taylor Collection

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    Brian DickeyPresident, Bio Clinical Labs