What is an API integration? Explained for SMEs

An API integration is a connection that lets two systems exchange data automatically, without anyone retyping anything. Your online store sends a new order to your accounting. Then your accounting tells the online store that an invoice has been paid. That happens within seconds to minutes, day and night.

API stands for application programming interface. An API is a “back door” in one piece of software for another piece of software. Through this entrance, a system can request or deliver data according to rules set by the supplying system. It’s a piece of software that lets two systems talk to each other.

How does an API integration work?

You can compare it to a service counter. After all, you don’t walk into another system’s filing cabinet yourself, do you? You hand in a request at the counter and you get a structured answer back.

In practice, an integration does three things:

1. Fetch. It asks a system for new data, for example the orders from the last fifteen minutes.
2. Translate. Every system has different definitions. What the online store calls a product is, in the accounting, an item with its own number and VAT code. The API integration converts one into the other.
3. Write. It delivers the data to the other system, for example as a sales invoice.

How does an API integration know new information is available? There are two ways. It asks at set times (jobs) whether anything has changed. Or the system itself sends a signal as soon as something happens; this is called a webhook. Which of the two is used depends on what the software offers. Unless you go custom.

An example

Take an online store on Shopify, payments through Mollie and accounting in Exact Online. Without an integration, someone at the office copies every order and every payment over by hand. That takes time. And you only notice a typo in an amount or VAT code at the tax return.

With an integration, it works like this: an order in the online store automatically becomes a sales invoice in Exact Online. Does the payment come in? Then that invoice gets the status “paid”. If it fails, for example because an item doesn’t exist yet in the accounting, someone gets an alert.

The same goes for other systems, such as Shopify with Moneybird or e-Boekhouden, or an online store with a connected ERP. I’ve built with Exact Online and Moneybird. Shopify, Mollie and e-Boekhouden I connect through their API.

Retyping, exporting or integrating?

Many businesses sit somewhere between manual work and a real integration. They export a file from one system and import it into the other. That works, but someone has to keep doing it. And a file sometimes gets forgotten, imported twice or saved in the wrong format.

	Retyping	Export and import	API integration
Who	A colleague, every day	A colleague, at set times	The system itself
How current	As often as someone has time	As often as someone exports	Within seconds to minutes
Errors	Very often	Often	Hardly any errors
When someone is away	Stays undone	Stays undone	Keeps running
When there’s a problem	You notice when a customer calls	You notice the next time	The integration sends an alert

What is system integration?

System integration is the bigger picture: making all your systems work together so data is entered once and is correct everywhere after that.

With two systems, you have one integration. If you work with five systems, decide up front which system owns which data: customers, items, inventory, prices. Otherwise you get two truths that drift apart. How that works for inventory, you can read in Online store inventory doesn’t match your ERP?

What do you use an API integration for?

• Removing manual work. Orders, invoices and data that now move between systems by hand. See business process automation.
• Online store and ERP. Keeping orders, inventory and prices in sync. See ecommerce, ERP and inventory integration.
• Reporting. Data from accounting, ERP and online store in one place, so your overviews update themselves. See data warehouse and reporting.
• AI assistants. An assistant that looks up data in your own systems through an integration. It only gets the permissions it needs, and changes only go through after a person approves them. See AI assistants and chatbots.

Standard or custom?

For many well-known connections there’s an off-the-shelf integration, often for a few tens of euros a month. Do you use your systems the standard way? Then that’s usually enough.

Custom work pays off when you have your own rules that a standard app doesn’t know, when more than two systems are involved, or when an error must not go unnoticed. Building an API integration then means recording which data goes where, building the translation between the systems, testing with real examples and setting up an alert for when something goes wrong. What that costs is on the pricing page.

Does a package have no API? Then it can often still work through a file that’s ready in a fixed location. Less tidy, but it works.

How do you start?

Write down which systems you use, which data now moves between them by hand and how often. Also note where things went wrong recently. That’s all you need for a first conversation. You’ll hear right away whether a standard integration is enough, or whether custom work makes sense.