Digging into the nitty gritty of CPG founder woes–
Every CPG founder I talk to eventually complains about EDI, specifically SPS Commerce. The UI looks like it was designed in 2004. Setup takes weeks. You pay per connection, per document, per character. Chargebacks from malformed files are constant. And still, it's what basically everyone uses. I couldn't figure out why a better interface hadn't won. EDI is nominally a protocol. In theory, if a retailer "supports EDI," they should support any EDI provider. So what's the actual moat? Once I dug in, the answer got uncomfortable. EDI as a standard barely defines anything. X12 gives you document types, an 850 is a PO, an 856 is an ASN, but the actual business logic is left almost entirely to the retailer. Which fields are required. What values are valid. How identifiers are structured. Whole Foods' 856 and Target's 856 are both "valid EDI" and almost completely different files. The real spec is a 40-200 page vendor compliance guide that each retailer publishes separately. So when a brand pays SPS, they're not paying for transport. Transport is trivial. They're paying for: - Pre-built maps to thousands of retailer-specific spec variants - Ongoing maintenance every time a retailer changes their guide - Certified trading partner status with basically every major retailer But here's the part that actually explains the market: retailers love SPS. Retailers pay very little (or nothing) to use it. The brand pays everything. SPS handles vendor onboarding, certification, and support, work the retailer would otherwise have to do internally. And the fragmented, retailer-specific rule set generates chargebacks that flow back to the retailer as a real revenue line. Vendor compliance has quietly become a profit center. A new EDI provider with a beautiful interface walks into this market and has to convince retailers to certify them. Retailers have no reason to. Their existing setup works, costs them nothing, makes them money, and is built around SPS's quirks. Better UX for the brand is not their problem. So the question "why hasn't better UX won in EDI" has a specific answer. It's not because no one's tried. It's because the side with the leverage, retailers, has every reason to keep things exactly how they are, and the side that's suffering, brands, has no seat at the table. The only thing that breaks this is retailers themselves deciding EDI is obsolete and moving to APIs, which a handful of modern retailers are starting to do. But the incumbents have no incentivize to do this. So I am not optimistic.