Home Business Value Added Network (VAN) – how does it work?

Value Added Network (VAN) – how does it work?

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Value Added Network is managed by an independent network operator, and allows companies, which are connected to it, to communicate with each other, e.g. exchange files and trading data such as orders, statements or invoices. VAN, as a part of METS (Managed Electronic Transaction Services), is a medium that allows an exchange of electronic data, in accordance with established standards and protocols of transmission.

In case of e-business, in the broad sense, the main aim is to use technology, not to buy it. If it appears that the purchase is not economical, companies prefer to choose services and pay a fee, which is more profitable for them. In this case, it applies to electronic transactions on the Internet or on a separate network, for example, with the use of VPN (Virtual Private Network) technology. This is the main reason of creating Value Added Networks.

As mentioned before, ​​VAN network creates a possibility to use new technology, such as EDI (Electronic Data Interchange), and use efficient, configured service for an access to the system instead of buying your own. It can all take place, for example, with the use of IP networks and data sent in XML format. In this way it is possible to send digitally signed data to the server, which is selected as service provider (e.g. to put up goods for auction or make an order on the stock exchange).

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