Life isn’t a game show. What lies behind the locked door isn’t a mystery. It’s the equipment to improve efficiency for your business so you can take your company to the next level. All you need is the key.
A 2017 study from Mint Jutras found that fewer than 60% of companies in the wholesale distribution space used full-scale, integrated solutions like enterprise resource planning (ERP) software to manage mission-critical operations.
The same study found that the top 20% of ERP implementations led to a 24% reduction in inventory costs. The rest of these implementations also performed very well, achieving a 13% decrease in those expenses.
The message is simple: A successful ERP implementation can mean lowering your spend on inventory, and a successful implementation starts with clear objectives.
The better your goals are defined across your supply chain when you begin shopping for an ERP and a solution partner, the more likely you are to achieve a highly successful outcome.
At Fusion5, we want to help you identify your pain points and determine the solution that will address those specific needs in the most effective way. We know that every organisation is unique and that your objectives are tailored to your business model.
Today, we’re taking a broad look at inventory management needs in the wholesale distribution sector, and we’ll explore how NetSuite, one of the most popular options, can help you improve efficiency and streamline operations.
Inventory management is one of several crucial supply chain processes. When everything is running smoothly, inventory management means having enough trading stock on hand to meet the demand for order fulfilment. At the same time, you want to avoid overspending on unnecessary goods or excess warehouse space and handling expenses.
Effective inventory management is important for:
It’s important to note that inventory management refers specifically to materials that are being bought and sold as part of your core business operations. Human capital and supporting equipment - for example, warehouse workers and forklifts - are not considered part of the inventory management process, since they’re not trading stock.
For wholesale distributors in particular, carefully tracking your inventory in real time and making sound decisions based on up-to-the-minute data is an area where some good old-fashioned Aussie ingenuity could give your business a critical edge over the competition.
If you’re used to simply getting by with disconnected operations tracked on siloed spreadsheets instead of using a fully integrated solution that delivers enterprise-wide visibility, you may think you’ve already got the edge. Your customers are happy, and they keep coming back, so what should you worry about?
Think about it this way: How much unnecessary administrative burden - like simple data entry - does your wholesale distribution company take on due to outdated processes? If the answer is more than zero, then you have an opportunity to improve your margins over today’s baseline performance.
If your wholesale distribution company manages multiple warehouse locations, how often do you wind up overstocked in one area but lacking inventory at another location? Is this issue ever the result of counterproductive internal competition or human error, with redundant work taking place across separate sites?
Unless you answered ‘never’ and ‘absolutely not’ to those questions, you’re probably missing out on a golden opportunity to streamline essential functions at your business.
These days, it seems like everybody’s talking about scalability. No matter the B2B solution you purchase, you want it to grow with you instead of just working for now and holding you back after you expand.
The truth of the matter is that a lot of businesses scale their operations to meet rising demand and then retrofit their processes and workflows to accommodate the changes..
For other businesses, they’ve managed to maintain a high level of success using legacy solutions, so they’re not even aware of how much more they could accomplish by using the latest technology.
Two important underlying functions that enable effective inventory management are:
Put together, that means there’s a whole lot of wholesale distribution companies using enterprise resource planning software that doesn’t do enough to help them figure out what their customers will need and when the company can get it to them.
Put simply, they have an inventory management capacity that’s at least a size too small for today’s climate.
It’s time to get fitted for the new world in which we live.
Like we’ve said before, the process of finding and implementing the right ERP system for your needs is all about the journey. To get started in the right direction, it definitely helps to know where you’re going.
NetSuite might just be the ERP software that’s waiting around the corner for your wholesale distribution company. Let’s take a look at some of its features:
Perhaps most importantly, NetSuite also integrates robust sales order management and supply chain management functions, enabling seamless communication between inventory management and associated business operations.
Switching to a cloud-native ERP can be beneficial for businesses that operate at every point on the supply chain.
Because of NetSuite’s experience in the wholesale distribution sector, they have discovered what works and what doesn’t. They know that accounting for warehouse stock and other inventory management processes can be essential for improving margins, monitoring inventory turnover, anticipating demand, increasing visibility and enabling businesses to refocus on their core competencies.
At a broad level, some of the key benefits of ERP software like NetSuite include:
If you’re ready to get started on the road to better inventory management, and more efficient wholesale distribution operations overall, work with us to discover the right ERP system for you. If you need help assessing if an ERP is what your company needs, we've made it easy with our Navigating Change Checklist, or you can get in touch through the form below.