Recent research has revealed that roughly half of distribution companies are using legacy systems and aging technology. A good number of them realize that this is causing delays and inefficiencies. They’re aware of the fact that they need to do something soon to streamline and improve systems. Others are blissfully unaware of the pain these antiquated systems are inflicting on their business. They do not realize the damage that’s being done, the amount of time that is wasted and the opportunities they are missing because they do not have the necessary systems, data, and reports to tell them.
The remainder of companies have already embraced new technology and they are seeing the benefit in many ways, but most importantly, in their improved bottom line.
Which of the above three scenarios best describe your company?
Requirements of Distribution ERP Software:
Inventory Insight
Inventory controlcan be a nightmare. You want to have the perfect balance of having enough of everything on hand when needed without tying up money in excess inventory that sits gathering dust. It is a great challenge and without an intelligent system to guide you, it will be practically impossible to manage effectively. This is particularity true during times of expansion yet vitally important if demand suddenly drops or changes.
Quality ERP systems including distribution and inventory control will take this pain away by proactively managing inventory as well as predicting trends and changing patterns. This will result in a profound improvement in productivity and customer satisfaction while reducing the costs of not only managing the system but not holding unneeded excess inventory.
If you are doing business with the larger, national chains, Electronic Data Interchange (EDI) is an essential requirement. It will effectively manage the order process from start to finish, automatically and electronically.
Customer and Market Insight
Businesses have always strived to understand their customers better. Although there were many tools available in the past, it was more of an art than a science. Now, more than ever, it is essential businesses have an intimate understanding of their customers and the market. Business is now global, and the majority of industries complex and ever changing. It is also fiercely competitive. Fortunately, modern technology, particularly ERP systems with the necessary integration and applications can make this task a lot easier and more accurate. Without knowing everything we can about our customers, they will probably soon become your competitors’ customers.
The other critical factor is maintaining customer service that is near perfect. With the fast pace and complexity of modern business, errors can and do occur. Distribution is one of the main areas of the business that can result in customer dissatisfaction. Again, the right software systems and technology will automate the bulk of the process, eliminating errors and preventing delays. It also provides accurate, up-to-date information so that when a problem does occur, customer care at least has an accurate idea of what the issue is and where it stems from. This allows them to correctly inform the customer and rectify the problem which will minimize the damage. The insight will also allow sales and marketing to better target their efforts, identify opportunities and improve up-selling and cross-selling.
Accessible Data
The complexity of dealing with multiple systems, products, and markets makes it almost impossible to make any sense of the data without the correct systems in place. Reports are extremely time-consuming to generate and even then, their accuracy is questionable. Distribution ERP simplifies this and allows you instant access to accurate data at all times. It can even be accessed remotely if necessary. Reports are not only instant and accurate; they provide a wealth of usable information that is clear and easy to understand. This will improve planning, control, and decision-making. Information is power, it will give you a competitive advantage and the right systems will provide this for your business.
Profitability Analysis
Although these are some softer issues, the main purpose of business is to make a profit. If you are a distributor you buy, sell and distribute products to generate these profits. Distribution ERP functionality will be able to tell you at all times where, when and how you are making a profit, or, not making a profit. This information is obviously crucial. In the past, weeks, sometimes months could pass before businesses became aware of the fact that a line, a product or a channel was not running at expected profitability levels. Now, thanks to technology, you can monitor this as often as you wish and in far greater detail than the past.
Distribution ERP software is essential to the profitable running of your business. If you are not already making use of it, it’s time to take an objective look at your systems and processes and investigate the potential benefits ERP can provide. As you can see here.
