AS2 vs SFTP vs VAN: Which EDI Connection Method Do Small Suppliers Actually Need?

For most small and mid-size suppliers, a VAN (Value Added Network) is the simplest and cheapest way to exchange EDI documents, while AS2 is the connection method big-box retailers like Walmart increasingly require directly. SFTP sits in between — cheap and flexible, but rarely mandated by major retailers. The “right” answer depends entirely on which retailers you sell to, not on which method sounds more modern.

If you’re evaluating EDI software or comparing yourself to an SPS Commerce alternative, understanding this piece matters more than picking a vendor — because the connection method drives a chunk of your ongoing cost, whether you realize it or not.

AS2 vs SFTP vs VAN: What Each One Actually Does

All three are just transport methods — the pipe that moves your 850 (purchase order), 856 (ASN), 810 (invoice), and 997 (functional acknowledgment) between your system and the retailer’s. None of them change the EDI document format. Retailers care about the transport method for security and reliability reasons; you should care about it because it directly affects your monthly bill.

VAN (Value Added Network): A third-party mailbox system. You drop documents in, the retailer picks them up, and vice versa. VANs have existed since the 1980s and most retailers still support them without complaint.

AS2 (Applicability Statement 2): A direct, encrypted point-to-point connection using digital certificates. Walmart has pushed suppliers toward AS2 for years because it eliminates the VAN middleman and gives Walmart tighter control over delivery confirmation.

SFTP (Secure File Transfer Protocol): A simple, secure file drop — the same technology used for any encrypted file transfer. Some retailers offer it as a lower-cost alternative to AS2, but it’s less common as a mandated method among the top 20 retailers.

Retailer Requirements: Who Wants What

Retailer	Preferred/Required Method	Also Accepts	Notes
Walmart	AS2	VAN (legacy accounts)	New suppliers pushed to AS2 via Walmart’s own gateway
Target	VAN	AS2 (select programs)	Most Partners Online setups run through a VAN
Kroger	VAN	AS2	VAN remains standard for grocery suppliers
Amazon Vendor Central	AS2 or SFTP	VAN (via EDI provider)	Direct AS2 self-setup is notoriously painful
Home Depot	VAN	AS2	VAN is the default for most supplier tiers

Cost and Complexity Comparison

Method	Typical Setup Cost	Ongoing Cost	Who Manages Certificates	Best For
VAN	$0–$500	$50–$400/month (per-document fees)	N/A	Suppliers selling to 2+ retailers with mixed requirements
AS2	$500–$3,000 (software/cert setup)	$0–$150/month	You, or your EDI provider	Suppliers required by Walmart or Amazon to connect directly
SFTP	$0–$500	$0–$50/month	You (key management only)	Simple one-to-one connections, low document volume

The dirty secret enterprise EDI vendors don’t advertise: many of them charge VAN-style per-document fees on top of a flat AS2 setup fee, so you’re paying twice for the same transaction. When you’re switching from enterprise EDI, this is one of the first line items worth auditing on your invoice.

Why This Trips Up Small Suppliers

Most compliance failures we see aren’t about mangled 856 data or missing GS1 barcodes — they’re about suppliers choosing the wrong connection method for a retailer that doesn’t support it, then burning two weeks of implementation time re-routing everything. A supplier onboarding Walmart while still running a Target-only VAN setup will often try to force Walmart traffic through the same VAN, get rejected, and then scramble to stand up AS2 under deadline pressure. That’s an avoidable delay if you map connection requirements before you sign a software contract, not after.

If you’re building out a broader EDI implementation timeline, connection method setup — cert exchange, testing, retailer sign-off — should be its own line item, not an afterthought bundled into “go-live.”

The Bottom Line

You don’t need AS2 everywhere and you don’t need to future-proof against every retailer you might someday sell to. Match the connection method to what your actual trading partners require today, and let your EDI provider (not a $30,000/year enterprise contract) handle the certificate churn. For a deeper look at what full-service EDI setup should cost, EDIBridge’s Orderful alternative comparison breaks down pricing models worth benchmarking against.

Last verified: September 23, 2026

FAQ

Does Walmart require AS2, or can I still use a VAN?

New Walmart suppliers are generally pushed toward AS2, but some legacy VAN connections remain active. Check your specific EDI onboarding packet — requirements vary by supplier tier and category.

Is SFTP secure enough for EDI with big-box retailers?

Yes, technically — SFTP uses strong encryption. The limitation isn’t security, it’s adoption: fewer top-tier retailers list it as a supported method compared to AS2 or VAN.

Can I use one connection method for all my retailers?

Rarely. Most suppliers selling to 3+ retailers end up running a hybrid setup — VAN for some, AS2 for others — unless their EDI provider consolidates everything behind one interface.

Will switching connection methods cause chargebacks?

Only if the transition isn’t tested before go-live. Missed 997 acknowledgments during a mid-switch gap are a common, entirely preventable chargeback trigger.

How long does AS2 setup usually take?

Certificate exchange and connection testing typically take 1–3 weeks per trading partner, assuming both sides respond promptly — longer if your retailer’s EDI team is backlogged.