WHAT IS ERP FOR DISTRIBUTION?

An ERP or Enterprise Resource Planning system is a business management platform which is commonly used by manufacturing and distribution companies to collect, store, manage, and communicate data across all functions of the enterprise. However, ERP can be utilized by a number of different industries, such as those in healthcare, non-profit groups, construction, and hospitality.

An ERP system integrates information across various departments (product planning, development, human resources, manufacturing processes, sales, marketing, etc.) into one complete enterprise system which streamlines daily processes, automates common tasks, and allows data to be viewed in real-time.

What is ERP for Distribution?

While ERP software embodies a bold new vision for distribution and how distribution companies operate, it’s hard to determine the fine line between manufacturing and distribution. The two industries seem undeniably similar, from order to cash processes, to identification of potential customers, and supply chain management, they are very comparable. However, when you start to peel back the layers of a true distribution process, you’ll see a difference in order quantity and order volume. For example, small manufacturers typically deal with small orders, while small distributors deal with large orders and typically have a greater volume of orders to manage.

Distributors place bulk orders with a manufacturer and then sell smaller quantities to retail stores or end-user customers. Distributors handle the logistics and marketing requirements that manufacturers don’t want to or aren’t able to handle in house. Since the two verticals work in different areas of the supply chain, their technology must conform to different needs.

Typically, distributors will need more tools than a manufacturer, as they provide end-to-end solutions. Features such as fleet management, inventory management, marketing and shipping are all necessary for success. Additionally, a distribution specific ERP system is constructed with business intelligence and customer relationship management (CRM) capabilities in mind. This helps provide valuable insight into the customers’ buying habits and behaviors.

Why do you Need ERP for Distribution?

Regardless of your company size, an ERP system will streamline a variety of your daily business processes into a single database to give you a greater view and catch any potential issues.

From an economic standpoint, an ERP solution helps distributors keep track of pricing. Forecasting elasticity and pricing demands is virtually impossible to do manually, so an ERP is critical to staying competitive in the distribution market.

Benefits of ERP for Distribution

• Eliminate Data Redundancy and Errors: Data repetition and errors are a common sight when you use different software to deal with such data. With an ERP integrated to your distribution business, you can get rid of such inefficiencies and manage your business better by having complete visibility of all your procedures and operations.
• Increased Revenue Growth: Since an ERP is integrated with your business, most of your sales and revenue data are readily available and are updated in real-time. With this information, you can get a deep understanding of business revenue. You will be in a better position to identify and manage cost variances. You will also be able to allocate financial, human, and operational resources better. This will eventually lead to rewarding outcomes such as an upward revenue growth, business expansions, better-paid employees, etc.
• Improved Inventory Management: An ERP system can save you precious time and money by eliminating the daunting task of manually process inventory management. Automated inventory management capabilities can improve your management processes by allowing end users to track and manage data across multiple warehouses – giving you real-time visibility to current inventory in transit and costs.

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 warehouse and distributor centers across the United States have come to us for over 25 years to execute their software projects—contact ACC Software Solutions today!