Resellers…Resource….Planning… System and associated high costs, complexity, and reorganizing a company and existing business processes to fit the imprecise spells a need of a piece of software. In today’s highly tech-savvy era, using an ERP could mean a huge difference for a company. It is true that ERPs cost a bit higher; however, when the their cost effectiveness in long term and other associated benefits of ERP systems outweigh the preliminary spending.
ERP software, like every technology, is persistently evolving. Every company is keen about customer relationships, and strategy to make businesses successful in the marketplace. The aptly implemented software provides better insight into business relationships and proves to be beneficial in staying successful in the marketplace. When it comes to ERP, every distribution company has its unique needs that set it apart. Some companies have an emphasis on reporting, and data access whereas others need control over customer information, manufacturing or inventory. Though priorities may vary business to business, most distribution companies’ needs include:
Key Takeaways:
- VARs that choose a well fitted ERP system trade higher upfront cost for long term gains in efficiency, customer insight and marketplace competitiveness.
- An ERP that integrates customer information, financials and warehousing data gives distributors a 360 degree view that enables proactive service and better profitability.
- Strong ERP based inventory management lets manufacturers and distributors balance stock availability and carrying costs by combining real time stock levels with demand forecasts and market pressures.
- ERP reporting that unifies logistics, inventory and financial data turns fragmented records into decision ready insights about trends, cash flow and overall business performance.
- ERP profitability analysis that drills down to item and customer level helps businesses identify their most profitable lines and relationships and focus resources where returns are highest.
A 360 degree perspective of the customer:
- What items does the customer usually purchase?
- What products are they no more buying?
- What are the ways preferred for placing orders and receiving the products?
By having all such details, distribution, wholesale and manufacturing companies can provide superior service to customers. Here, ERP software needs to provide integration between a complete array of customer information, financials, and warehousing to help foresee customer needs. This comprehensive 360degree visibility makes it possible to meet your personal goals and optimize profitability by achieving more efficient operations. Improved profitability, streamlines operations certainly spell your success.
Strong Inventory Management:
In any distribution company, inventory is always on the move. Today’s smart customers always expect the items they want to be in stock. This makes it essential for an inventory management system to be capable of maintaining real-time insight into stock levels. Furthermore, it should feature the ability to predict future needs precisely so as to facilitate the information needed to uphold the right stock levels devoid of excess storage costs. Managing inventory is not just about maintaining a count of finished goods or raw materials in the warehouse. Several other variables and aspects need to be considered that can impact distribution and production activities including marketplace pressures, anticipated customer needs and customer projects in progress.
Busy manufacturers and distributors need to have strong inventory management, as losing sight of items can mean stock-outs and back-orders, and customer relationships at risk and overstocking the warehouse means the burden on cash flow. A proactive approach to inventory management can prove to be a smart way to increase profit margins while keeping customers delighted. By deploying an ERP solution, you can have greater control and insight over inventory, and this will help you make financially beneficial decisions, and enhance customer satisfaction. Armed with this insight, it becomes easy to make strategic inventory decisions that can save money and you can always maintain the particular items that your customers need when they need them.
Insight and Reporting:
ERP systems can assemble a variety of different types of information across multiple applications from logistics to inventory and financials. ERP software can pull it together into a report, and thus you can have the insight to assist with decision-making in several aspects of your business. It is essential to integrate an ERP across the applications that are crucial to your business. With a distinct data resource, you can easily produce various needed reports and analytics by deploying an ERP system. Regular fiscal reports like income and cash flow statements are usually built-in. By having in details insights into company related information, it gets easier to make well- informed decisions on the basis of end-to-end trends and metrics.
Profitability Analysis:
What’s the basic purpose of your business? Surely it is making money. So how to know whether or not you’re doing so? ERP system will tell you it so and that too not just at the level of the business, but at the level of the items you hold and sell. Analyzing profitability lets you to evaluate expenditure to acquire customers, costs of products, cost to carry items that some customers buy, and so on. This will give you a clear picture of profitable product lines and customers, and areas where you need to focus your efforts.
From all above-mentioned points, you might have got an idea about what points to consider while making a critical decision about selecting right ERP system. Invest your time to research well and go for the right ERP solution that fits your business needs.
Pro Tips:
- When evaluating ERP options, weight the vendor’s ability to integrate all your existing customer, financial and warehouse systems more heavily than cosmetic features or small license fee differences, because integration quality will decide whether you ever realize the promised 360 degree view.
- Before full rollout, run a pilot using real historical orders, inventory movements and margin data to confirm that the shortlisted ERP can actually surface reliable item level and customer level profitability insights that match your strategic needs.
