For wholesale distributors, there is a dependence on the effectiveness of your chosen ERP system (Enterprise Resource Planning). Many distributors have capital investments in supply chains that are often complex, so it needs to be effectively managed. This means that choosing the wrong ERP can waste significant money and time.
The need for ERP
As a distributor, it is essential to know what is in stock, as having unnecessary or excessive levels can waste money and decrease profit levels. For these reasons, an ERP for a wholesale distributor can be invaluable. However, choosing an ERP system should be done with care because there are many factors to be considered.
Modern ERP systems use sales order management features, allowing distributors to automate their order processing. Depending on your needs and the chosen solution, the core ERP system could link to POS software too. Features may include self-service, shipping management, order inquiries, and more. Consider which features your business would benefit from most by looking at your short to long term goals.
Good ERP software will provide management with a broad financial picture of both items and customers. You could consider your specific area and sphere of operations, as some financial planning tools will be more appropriate than others. These can include debt management, cash flow, accounts payable and receivable, and more.
If you’re looking for more accurate inventory control, various warehouse management functions can optimise your processing and fulfilment. Companies should also consider the benefits of different types of platforms. For example, would your stock control benefit from having an on-premise software, or should you be considering using a cloud solution?
Like all businesses, wholesale distributors will benefit from having contact and customer identifiers, allowing them an insight into customer behaviours. You should consider the effectiveness of your current promotions and sales processes, and whether if you moved to use a CRM tool within ERP will be more advantageous.
Whether its connecting to wholesalers, vendors, manufacturers or customers, accurate data from your online store is crucial for customer service. You may want to consider looking for appropriate synchronisation between the back-office system and website; options such as customer-related, product, price list, and delivery data.
Tips for assessing ERP systems
It’s important to compare the benefits of various systems before deciding on one for your distribution business. To do this, it may be useful to:
- List how systems may offer long term benefits to your business compared to your long-term goals.
- Examine your workflow and understand your future wholesale distribution needs, and whether the ERP systems will be able to address them.
- Ask for a free analysis of any potential ERP systems so you can gauge any improvements they may make to your business.
- Look at the system functions to evaluate whether these meet your business need now and in the future.
- Consider whether a cloud or on-premise system is appropriate for your business. Cloud solutions tend to have lower initial costs but higher on-going costs, but on-premise systems often offer more control and lower long-term costs.
- Review the ERP provider as well because they will the ones helping you to implement and providing support for your new system.
For more information, don’t hesitate to contact us. Our team are more than happy to offer advice on which ERP system may most benefit your wholesale distribution business.