3 TRENDS FOSTERING GROWTH IN THE DISTRIBUTION INDUSTRY

Energize and Innovate Your Business with This Year’s Top Distribution ERP Trends

It is an accepted fact that the past few years have been anything but normal (the COVID-19 pandemic, inflation, labor shortages, supply chain issues, etc.). Which is why many businesses are focusing on rejuvenating their energy and innovation efforts to remain competitive in today’s market. There are two ways to accomplish this: by staying on top of (and participating in) distribution ERP trends and by researching distribution ERP systems.

Distribution ERP systems collect data from every department into one location, making real-time data easily accessible to all team members. A distribution ERP system should supply you and your team with financial, inventory, customer, commerce, sales order, purchase order, order, requisition, warehouse, and service management capabilities. The system should also deliver an integrated POS system, business intelligence, and data analytics.

This may sound like a lot of “shoulds” for a single solution, but there’s even more. A distribution ERP system should simplify item management, automate, and streamline your warehouse needs, and rest on a future-proof cloud platform with configurable workflows and modern APIs.

Although distribution and manufacturing ERP systems carry many of the same features and functionalities, it’s important to not confuse the two. Distributors often handle larger orders and a greater volume of total orders (not to mention logistical and marketing requirements), which is why they need an ERP that specifically addresses the fluctuating issues, measurements, patterns, and data points associated with the distribution industry.

To satisfy this need, ERP providers are integrating the top three distribution ERP trends of 2022 into their software offerings.

Here’s what you can expect:

Synchronizing Supply Chain with RFID and IoT

As a result of the COVID-19 pandemic, supply chain disruptions, inflation, labor shortages, and other challenges continue to cause havoc amongst manufacturers, distributors, and their customers. It’s a complicated situation that won’t be resolved any time soon, which makes it one of 2022’s sad but undeniable distribution trends.

On a positive note, this unwelcoming trend point to exactly what distribution ERP systems can do in terms of supply chain management. For example, they can integrate various technologies—such as Radio Frequency Identification (RFID) tags and the Internet of Things (IoT)—to help individual businesses synchronize their supply chains.

RFID tags aren’t new, but their ability to transmit data from an item to a computerized reader makes them an ideal tool for tracking goods (keeping up with what’s in a package/pallet, where the items came from, whether the contents are correct, if stock levels are accurate, etc.). Data from RFID tags can be synched with the IoT, which can then be synched with an ERP solution.

The information captured in this communication chain will help you manage what you have in stock, what items are coming and when they will arrive, equipment statuses, transportation conditions, and more. This boosts the visibility of the supply chain and improves decision making.

Improved Distribution Automation

Distribution ERP systems are also veering toward automating processes. Automation is a major factor in reducing labor costs, improving operational speed, minimizing human error, and increasing accuracy—as the RFID/IoT example clearly shows. Instead of counting and locating inventory manually, employees can pull reports containing that data directly from the distribution ERP solution.

To improve the entire workflow, it’s essential to have as much information as possible about the distribution processes. This means there is no time to waste on data collation or preliminary analysis; only after the required analysis has been conducted can you find and fix bottlenecks and pain points in an organization’s distribution processes. Such clear workflow visibility reveals the health of processes and the organization as a whole.

Artificial Intelligence (AI) and Machine Learning (ML)

While artificial intelligence (AI) and machine learning (ML) have been around for decades, many distributors have not yet recognized how they can be used to take advantage of industry trends.

Let’s take a look at what AI and ML can do. AI takes large amounts of data, and, using algorithms, it analyzes that data to provide predictions, forecasts, and calculations that would take mere humans an extraordinary amount of time to determine. ML has been defined by an MIT Management Sloan School article as “a subfield of artificial intelligence that gives computers the ability to learn without explicitly being programmed.” When combined, AI and ML can take distribution data and help distributors:

• Forecast demand and influence decisions.
• Fill orders faster and more efficiently.
• Optimize route planning for quicker deliveries.
• Detect inventory and supply chain issues before they occur.

Altogether, these benefits add up to happier, more satisfied employees and customers—and to a happier, more profitable you.

Your Next Steps

When you team up with ACC Software Solution’s premier team of consultants, you’ll receive a team of experts committed to following ERP best practices, from selection to end user training.

Find out why distribution centers across the United States have come to us for over 25 years to execute their software projects—contact ACC Software Solutions today!