Anyone who has a wholesale distribution business knows how important inventory control is. Oversight of your stock on hand is crucial if you are to meet your goals and fulfill customer demands.
Knowing what you have and where you have it can be a challenge when inventory is continually entering and exiting your warehouse. But keeping on top of what you have helps you lower your costs, speed up fulfillment, and prevent fraud. Accurate knowledge of inventory in and out allows you to accurately assess the state of your business.
Balancing your stock
Why is balancing your stock so important?
If you have too much inventory, you’ll have too much of your assets tied up and sitting on the shelf where they can be damaged, dated, or destroyed. Not to mention, the potential extra carrying costs.
On the other hand, if you have too little inventory, you risk losing customers. None of us likes to hear that the item we want right now has been backordered. We’ll just check with your competitor and see if we can get it right away.
When you control your inventory, you can provide better customer service, retain loyal customers, and increase your profits. Good inventory control software helps you to balance the stock in your warehouse.
Not long ago, control of your inventory required a sharp pencil and lots of paper. More recently, computer software such as excel allowed you to formulate updatable spreadsheets that took some of the paper out of the equation but kept the labor-intensive, error-prone manual entry. Even with columns for everything from the customer’s name to item number and date in and date out, it was difficult to get a comprehensive view of your business.
Today there are many options for inventory management, right within your ERP (Enterprise Planning Resource) solution and other business applications such as a Warehouse Management system that adds barcode scanners, printers, and mobile devices for inventory automation. In addition, with the right core ERP system there also add-on tools the can review your purchases and sales and create suggested purchase orders in advance so you will have product on hand when your customers need stock.
With the wide network of add on products for distribution you have the flexibility to choose additional functionality for ecommerce, EDI, data collection, warehouse management, compliance, lot tracking, serial tracking, landed cost, pick pack ship, 3PL integration, drop ship management, multi-currency, barcoding, container management, integrated shipping, inventory planning, bill of materials, manufacturing orders, inventory control, lot control, and standard costs.
Each distribution business is different, and you need the ERP solution that will work best with yours.
Figure out what method you will use to reorder stock: minimum stock level, fixed quantity ordered at regular intervals, standing orders, etc. The method you choose will depend upon your business but remember that your business could depend on the method you choose. Don’t get caught without the inventory that is so vital to your distribution business.
ERP Systems for the Distribution Industry improve customer satisfaction, reduce order times, and control costs. With an ERP solution (either on-premise or in the Cloud) from top vendors such as Microsoft Dynamics GP and Acumatica, you’ll have the tools you need to stay on top of your inventory.
Since 1982, CAL Business Solutions has been providing ERP systems to small and mid-sized distributors. These solutions manage supply chain and logistics activities, including warehouse management, inventory management, and order management (sales and purchase orders), and connect these operations with financials and sales.