EDI 850 - Purchase Order
The EDI 850 is the universal purchase order - the document that kicks off every supply chain transaction. When a buyer places an order, the 850 carries every item, quantity, price, and delivery requirement to the supplier in a single structured transmission.
✦ What It Does
The EDI 850 Purchase Order is the electronic equivalent of a paper or emailed PO. It travels from buyer to seller and contains everything the supplier needs to fulfill the order: item identifiers (UPC, GTIN, buyer's part number), ordered quantities, agreed prices, ship-to address, requested delivery window, and any retailer-specific routing instructions.
The 850 is built around a header (BEG segment) that establishes the PO number, PO type, and PO date, followed by one or more PO1 line-item loops. Each PO1 loop captures a single SKU with its unit price, unit of measure, and product identifiers. Nested within the PO1 loop, the PID segment carries free-form or coded product descriptions, and SAC segments capture line-level allowances or charges. After all lines, a CTT summary segment totals the line count, and a mandatory SE segment closes the transaction.
Retailer 850s are often significantly more complex than a basic PO. They commonly include N1 loops to identify ship-to, ship-from, and bill-to parties; REF segments with department numbers, buyer codes, or vendor numbers; DTM segments for requested delivery windows; and FOB segments for freight terms. Some retailers embed their entire routing guide requirements inside the 850 via TD5 (carrier) and TD3 (equipment) segments.
⚡ When It's Triggered
- A retailer buyer approves a purchase in their procurement or ERP system and the system automatically generates the 850 for transmission.
- A replenishment system (VMI or auto-replenishment) calculates reorder quantities based on inventory levels and fires a 850 without manual intervention.
- A distributor places a stock order with a manufacturer for warehouse inventory replenishment.
- A grocery chain's category management system releases a promotional order tied to an upcoming circular event.
- An eCommerce marketplace aggregates consumer orders and transmits a consolidated 850 to the supplier or 3PL for fulfillment.
- A manufacturer's MRP system generates purchase requisitions that convert to EDI 850s sent to component suppliers.
Who Uses EDI 850
Retail Suppliers
Receive 850s from big-box, department, and specialty retailers. Each retailer has unique 850 requirements - Walmart embeds routing instructions directly in the PO, Target uses specific REF qualifiers for department and style, and Home Depot requires floor-load vs. pallet indicators. Getting the 850 mapping right is prerequisite to every downstream transaction.
Grocery & CPG
Grocery 850s often carry promotional pricing via SAC segments, deal numbers in REF segments, and very tight delivery windows in DTM loops. CPG suppliers must map the retailer's buyer item number back to their own SKU, manage multiple UOMs (case vs. inner pack vs. each), and handle order minimums that vary by distribution center.
Manufacturers
Both send and receive 850s. They send them to component and raw material suppliers as part of MRP-driven procurement. They receive them from OEM customers or distributors. In automotive and industrial manufacturing, 850s are often replaced by 862 (Shipping Schedule) for JIT production, but blanket 850s establish the contract quantities.
Distributors
Distributors receive 850s from retailer or end-customer buyers and generate their own 850s upstream to manufacturers and brands. They sit in the middle of the 850 flow, transforming customer PO numbers, item identifiers, and delivery requirements as orders pass through the distribution layer.
3PL Providers
3PLs receive 850-derived data (often via a 940 Warehouse Shipping Order) but increasingly receive 850s directly when acting as a supplier's fulfillment node. Understanding the 850 structure is essential for pick-and-pack, cartonization, and label generation workflows.
eCommerce & Marketplaces
Amazon Vendor Central, Wayfair, and other drop-ship platforms send 850s for both vendor-fulfilled and direct-import orders. eCommerce 850s often carry ship-to consumer addresses (not DC addresses), gift messaging in N9 segments, and expedited carrier requirements that differ from brick-and-mortar POs.
Key Segments & Data Elements
BEG: Beginning Segment
Opens the transaction and establishes transaction set purpose code (00 = original, 05 = replace), PO type code (SA = stand-alone, KN = blanket, RO = rush), PO number, and PO date. The PO number in BEG03 is the key cross-reference for all downstream documents (855, 856, 810).
PO1: Baseline Item Data
One loop per line item. Contains line number (PO101), ordered quantity (PO102), unit of measure (PO103, e.g., CA for case, EA for each), unit price (PO104), and basis of unit price code (PO105, e.g., PE = price per each). Multiple product ID qualifiers follow in PO1 - BP for buyer's part, VP for vendor's part, UP for UPC, UK for UPC case.
N1 / N3 / N4: Party Identification
N1 loops identify trading parties by functional qualifier: ST = ship-to, SF = ship-from, BY = buying party, VN = vendor, BT = bill-to. The N1 segment carries the party name and identification method (92 = assigned by buyer, 1 = DUNS, 9 = DUNS+4). N3 and N4 provide street address, city, state, and ZIP.
DTM: Date/Time Reference
Multiple DTM segments appear at header and line level. Key qualifier codes: 002 = delivery requested, 010 = requested ship date, 037 = ship not before, 038 = ship not after, 063 = do not deliver before. Retailers use DTM windows aggressively - delivering outside the 037/038 window triggers chargebacks.
SAC: Service, Promotion, Allowance, Charge
Carries line-level or order-level allowances and charges. SAC01 indicates whether it's an allowance (A) or charge (C). SAC05 is the percentage or SAC06/07 is a dollar amount. Common codes include H850 (promotional allowance), I310 (freight), and F510 (handling). Critical for accurate invoice reconciliation against the 810.
CTT: Transaction Totals
Mandatory closing segment that provides the total number of PO1 line items (CTT01) and optionally the total quantity (CTT02) and total value (CTT03/04). Used for balancing and validation - if your 810 line count doesn't match the 850 CTT, expect reconciliation failures and potential short-payment.
Related Transaction Sets
Purchase Order Acknowledgment
The supplier's required response to the 850. Confirms acceptance, partial acceptance with changes, or rejection. Must echo the PO number from BEG03 of the 850 and reference each line item. Retailers require 855 within 24–48 hours of 850 receipt.
Ship Notice / Manifest (ASN)
Sent by the supplier when the order ships. References the 850 PO number and provides shipment details, carton contents, carrier, PRO/tracking number, and pallet configuration. Must be transmitted before delivery arrives at the DC.
Purchase Order Change Request
Buyer modifies the original 850 - changing quantities, prices, delivery dates, or ship-to location. References the original 850 PO number. Supplier should respond with an 865 to confirm acceptance of changes.
Invoice
The supplier's invoice after shipment, referencing the 850 PO number and the 856 shipment. Line items, quantities, and prices must reconcile against the 850 or the buyer's AP system will trigger a deduction.
Need Help with EDI 850?
Better EDI handles 850 mapping, testing, and trading partner certification so you don't have to.
Talk to an EDI Expert