Many firms—including those in the wholesale distribution sector—have achieved more efficient business operations by using cloud-based ERP.
There are few hard boundaries confining the industry sector in which wholesale distributors operate. Many sellers – be they wholesalers or retailers – have warehouses and distribution operations, and much variety exists within the distribution function itself. Some distributors do little more than drop ship standard items from warehoused inventories when orders arrive, while others are actively engaged in the design, manufacture, customisation and/or sale of the products they distribute.
Whatever the variations on the theme, wholesale distributors face challenges ranging from tight margins to supply chain and delivery-carrier dependencies. Succeeding in this demanding and fast-paced sector requires that companies operate with high efficiency and low error rates. Wholesale distributors that don’t closely track and optimise their core operations can put critical business relationships at risk, seriously undermining their profitability and growth potential.
Critical Wholesale Distribution Metrics Extend Well Beyond the Factory Floor
Wholesale distributors form the critical link connecting manufacturers and other suppliers with retailers and end customers. Because they sit in the centre of the commerce process, these companies risk being scapegoats when things go wrong, but may not always get the credit when things go right. They must walk a tightrope, balancing variable product availability on one side with fluctuating customer demand on the other. As a result, they need 360-degree business visibility, smart inventory management, efficient order and shipment processing and quick problem resolution. Among the operational challenges wholesale distributors face:
Supplier partners: Wholesale distributors must track product availability, costs and quality from manufacturers and other suppliers.
Retailer partners: Wholesale distributors may have to manage different forms of relationships with retailers, ranging from simple drop-ship order fulfilment to providing customisation and other value-added services.
Carrier partners: Wholesale distributors must depend on third-party carriers to deliver the correct products on schedule and undamaged.
Inventory: Ensuring that inventories are stocked to meet current and future demands, while limiting overstocking and item obsolescence, are critical requirements.
Reporting: Workers ranging from the finance team to warehouse-floor supervisors and workers need accurate, real-time reports spanning the full range of relevant operations.
Orders and Shipping: Orders for goods must be rapidly processed and goods from inventories must be correctly packaged and shipped from the distribution centres closest to the customers’ addresses.
Customisation: ERP, CRM and other functions must be easily customised to match individual company business processes and requirements.