ERP software selection in the wholesale distribution market has significant functionality for a small business. Wholesale distribution operations can benefit from these high value tools to better manage customer needs and inventory levels in the warehouse. In the modern software marketplace, sophisticated ERP tools like Electronic Data Interchange (EDI), Return to Vendor Systems (RTV) and an Automated Purchasing System are available and affordable in small software offerings.
Electronic Data Interchange (EDI)
EDI with key customers and suppliers can significantly reduce your operating costs on managing the information in any long term business relationship. These systems also offer accuracy in data entry and speed in processing of the information, since they do not rely on humans to enter and process orders. EDI is the standard tool for large organizations, but smaller companies have been able to implement EDI exchanges with key partners at very affordable costs. Once a document exchange is created, the benefits to both parties are ongoing. Therefore an EDI set-up should be considered for any long-term partnership that exists between a customers and suppliers.
Return to Vendor
Another less common but valuable tool for may distributors is the reverse logistics of inventory. We all buy inventory – but what about sending these items back? When items don’t sell or become outdated by a new release from a vendor, distribution channels send the goods back to the supplier. This could be a time consuming process unless you have access to tools that can manage the correct costing of various shipments of inventory from a supplier. Over a year, you may receive 5 different shipments of the same item, all at different costs. ERP Software can mange the return based on the receipt record of each item and allocate the correct item cost in inventory when posting the return. This is critical information to account for your inventory values and for your return claim against the supplier.
Recommend to Purchase System
Anyone can create a purchase order, but knowing what to buy and when to order is the key to keeping inventory costs to a minimum. That is where Recommend to Purchase systems come into play. These systems typically evaluate a product sales over specific time periods, look at the min/max levels set for the item, supplier lead-time, economical order quantity and frequency of orders to this supplier to calculate how many of each item to purchase. This is a big number cruncher system that can evaluate many additional product and sales variables (seasonality, new item, promotions) and fairly calculate what you will sell over the next period. A RTP system gives the purchaser time to review the big picture without having to crunch all the data on their own. They make the final decisions on how much to buy but the hard work of collection the data is already completed for them. They simply make an fine adjustments and release the purchase orders.
Modern ERP systems include these key tools that are helping the wholes distribution market to be competitive and cost efficient with this offering to customer. Click here to learn more.
To read more about current trends in Distribution and Warehouse Management techniques, please visit one of the following recent posts;
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About the author:
Beckard president Dave Savard brings extensive management, business planning, and operational expertise to the company, gained through two decades of public and private sector management experience. Dave’s ability to diagnose client operational problems and provide effective, practical solutions has earned him the enduring loyalty of clients. He is also known for a deep commitment to customer service, ensuring that client needs are not only met but that client priorities are considered in future product enhancements. In his role as company president, Dave holds responsibility for operations, planning and customer service. Dave has a degree in Economics and Law from Carleton University.
Beckard Associates is a full service ERP and Wholesale Distribution Software company providing Accounting, Warehouse Management Systems (WMS) and Customer Relationship Management (CRM) tools to companies across North America. We write blog articles that inform and educate are clients and colleagues. If you would like to learn more, please visit us at beckard.com.
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