What is an API? How your systems talk to each other

Every morning the bookkeeper opens the webshop in one window and e-conomic in another. Each order from yesterday is typed in as an invoice, and then a shipping label is created in PostNord’s portal. With 40 orders a day, that is two hours every day, and typos creep in regularly. That is exactly the kind of work an API removes. When the webshop and the accounting system can talk directly, the invoice and the label appear on their own, seconds after the customer pays. This guide explains what happens behind the scenes, so you can ask the right questions and judge whether an integration pays off.

What is an API? Explained without jargon

API stands for application programming interface. You can think of it as a socket: a fixed entrance a system offers, so other systems can use it without knowing its insides. Think of a restaurant. You sit at the table and order from the menu. The waiter takes your order to the kitchen and comes back with the food. You do not need to know how the kitchen is laid out, and the kitchen does not need to let you in. The menu is the API documentation, the waiter is the API, and the kitchen is the system behind it.

In practice it looks like this: your webshop sends a message to e-conomic saying "create an invoice for this customer with these line items". e-conomic checks that the message comes from you, creates the invoice and replies with the invoice number. The whole conversation takes under a second and uses a structured format, usually JSON, that both systems understand. No people are involved, and the same thing happens every time, in exactly the same way.

Which APIs does your business already use?

Most companies use APIs every day without knowing it. These are the examples we meet most often with Danish clients:

• Payments: the webshop asks MobilePay, Stripe or a card acquirer to reserve and capture an amount.
• Accounting: orders, customers and invoices are sent automatically to e-conomic or Dinero.
• Shipping: PostNord or GLS creates a label and a tracking number from the address.
• Login: MitID confirms the user’s identity without your system ever seeing their password.
• Company data: the Danish CVR register fills in company name and address when a customer types a CVR number.
• Digital signatures: Penneo sends a contract for signing and reports back when it is signed.
• Maps and addresses: Google Maps or the Danish address service DAWA shows locations and corrects addresses as the customer types.

Each line on the list is a task that would otherwise need a person, a screen and a copy-paste. We go deeper into the two most requested in the article on e-conomic and Dinero integration and on the page about MobilePay integration.

What is the difference between a REST API and webhooks?

There are two basic ways systems talk. With a REST API, your system asks when it needs something: "what is the status of order 1042?" With a webhook, it is the other way round: the other system tells you when something happens, for example "the payment for order 1042 has gone through". Most good integrations use both.

Other API terms you will come across

How does an integration between webshop, payments and accounting work?

It looks simple on paper, but the details decide whether an integration is good or bad. What happens if the customer already exists in e-conomic? How is a partial return handled? Which VAT account does a service sold abroad go on? Those are business rules, and they need to be agreed with you before any code is written. We call it the invisible half of an integration.

What does an API integration cost?

Run the numbers for the bookkeeper from the start. 40 orders a day at three minutes each is two hours a day, or roughly 40 hours a month. If you put an internal hourly cost of, say, DKK 350 including salary and overhead, the manual process costs around DKK 14,000 a month before errors are counted. A standard integration at DKK 30,000 pays for itself within a couple of months. We have collected the method for finding and costing that kind of task in the guide to digitising manual processes.

What can go wrong with integrations, and how do you avoid it?

• Errors go unnoticed. An integration stops on a Friday and nobody notices until Monday. Require monitoring and alerts.
• Duplicates. The same order is sent twice and becomes two invoices. Require the integration to recognise repeats.
• No retries. If e-conomic is down for five minutes, the message must be sent again when it is back.
• Outdated versions. The supplier retires an old API version, and the integration stops working.
• Overly broad rights. An integration that only needs to create invoices has access to everything.
• Personal data without an agreement. When customer data flows between systems, data processing agreements must be in place.

The point about personal data deserves to be taken seriously. Every time you send customer data to a new system, that is a new data processor, and it must appear in your records. See our practical guide to GDPR for websites and apps.

Does your system have an API? Questions for the supplier

Before you buy a new system, or before you ask for an integration, send these questions to the supplier. The answers decide whether the integration will be easy, expensive or impossible.

1. Does the system have a publicly documented API, and where is the documentation?
2. Is API access included in our subscription, or does it cost extra?
3. Can the system send webhooks when something changes?
4. Is there a test environment we can use without real data?
5. How many requests may we send per minute?
6. How do you announce changes, and how long do you support old versions?
7. Can we create keys with limited rights?
8. Can we export all our data if we switch systems?

When do you need your own API?

So far we have talked about using other people’s APIs. Many companies also end up with their own. It makes sense when the same data is used by a website, an app and an admin panel, when partners or customers need to fetch data automatically, or when you want to be able to change the front end without rebuilding everything. Your own API is also the foundation of a headless CMS and of most modern apps. It is an investment that makes your systems easier to extend, because every new solution can plug into the same place.

How does Ceptiv work with APIs and integrations?

We have more than 40 pre-built integrations, including e-conomic, Dinero, MobilePay, PostNord, Penneo, Stripe and MitID, which we reuse and adapt to your business rules. That is a big part of why we can give a fixed price quickly. Our web packages include from one to three integrations, and running them, with monitoring, updates and adaptation to new API versions, is part of the fixed monthly price. See the full list under integrations, or read about our work with automation.

Tell us which systems you want to connect and what is done by hand today, and you get a fixed price for the integration within 24 hours.