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Top 5 Trends for Distributors and How Dynamics NAV Can Help

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Regardless of your industry, it’s imperative to change in order to stay competitive – no one likes to be taken by surprise. Distribution companies in particular need to take note of the technology trends within the industry that can directly affect their success. Below are five trends that distributors need to be aware of in order to stay competitive.

1. Overseas Manufacturing
When manufacturers decide to move operations overseas, it can create a world of complexities for distributors.  While it may make financial sense in many areas, it can actually increase costs in others, such as landed costs due to duty charges and additional shipping or transportation fees.  It’s important to know whether the cost savings of overseas production will offset a likely increase in distribution costs, especially if production is being moved farther away from your geographic market. Having an effective ERP solution like Microsoft Dynamics NAV provides an accurate picture of tracking, inventory and landed costs so you have real-time visibility into all areas of your supply chain.  This kind of transparency can also help reduce communication problems that often arise between U.S.-based companies and their overseas production units.

2. Improved Forecasting
Another trend that will greatly benefit distributors is the ability to more accurately forecast inventory. Since this is usually the biggest expense for distributors, reducing carrying costs and increasing margins can substantially boost your bottom line.  Through flexible forecasting tools available in Microsoft Dynamics NAV, factors such as historical usage, lead times, seasonality, and even customer-provided forecasts can be used to create a realistic picture of your inventory needs. Of course, customer demands always change as time goes by, so how do you adapt to the unexpected? Dynamics NAV uses flexible forecasting tools that adjust to these changes and reflect real procurement requirements.

3. Tighter Collaboration
The availability of new technologies also allows distributors to increase collaboration with customers and vendors, resulting in better forecasting and inventory management.  Through technologies like EDI, XML and other web services, distributors can get complete visibility across all elements of the supply chain, including the customer, distribution center, store and item.  And since these tools are built in Dynamics NAV, they allow seamless data mapping and other communication benefits from within the ERP solution.

4. Warehouse Efficiencies
Do you have the technology to know whether your warehouse is running as efficiently as possible? Many distributors underestimate the ability of technology to reveal inefficiencies in their operations, but this is vital to keeping your business competitive. In a streamlined warehouse, fast-moving items are placed in an easily accessible location and pickers use hand-held scanning devices to reduce the number of errors and track inventory.  By integrating warehouse management with the broader benefits of an ERP solution, Dynamics NAV provides real-time data and metrics showing areas that need improvement, allowing you to make decisions that result in more streamlined operations and improved customer satisfaction. If you’re currently using a Warehouse Management System that doesn’t integrate with your other business systems such as ERP, you are simply not seeing the whole picture.

5. Ecommerce Solutions
Many distribution companies are finding that an ecommerce front end can help decrease operating costs. By creating a self-service platform for B2B or B2C customers, you may be able to reduce customer service personnel. It also helps your existing customer service staff work more efficiently by giving them the ability to answer customer inquiries and take orders while on the phone. Tools are available within Dynamics NAV that allow real-time entry of sales orders and quotes, resulting in more efficient processes.

Every business must evolve over time in order to meet the changing demands of their market.  This applies to everyone, even traditional distribution and manufacturing businesses – it’s vital to be aware of new technology trends that align with your business goals.  Even if you’ve worked hard to implement efficient processes at your organization, when was the last time you evaluated them to see if they are still best practices? Your competitors know that economies and market demands can change quickly – are you staying ahead of the curve?

By OmniVue, a Georgia Microsoft Dynamics Partner

One Response to “Top 5 Trends for Distributors and How Dynamics NAV Can Help”

  1. Pc Software says:

    nice article, this is very appreciable one, you wrote and presented the information in simple way with good details… all the best