When you run a business whether it is a small or large enterprise there are lots of things you need to focus on, such as marketing, product design, quality, sales strategies, lead management customer support and services, social media engagement, and more.
But distribution channels or distribution management strike at the least. Do you know enhancing distribution channel performance can greatly increase profits and stimulate business growth?
When you are using the legacy system with scattered applications and spreadsheets that have a specific job to run the business effectively. These disconnected applications will rob you of having a comprehensive look at your business operations.
Another most important thing to be taken care of in the sales and distribution management system is to keep pace with the increased customer demands and the order sizes.
As the order size increases distributors might face difficulties while depending on the manual processes and lack of integration between various applications of business. This makes businesses lag behind their competitors.
A powerful distribution management system software allows you to maintain the complete stock workflow. It helps you to manage the operation and processes through various retail distribution network systems.
Distribution Management System software allows you to manage the supply chain by handling inventory, distributor duties, promotions, transactions, invoicing, and so on.
Sales and distribution system software allows you to access the real-time data from the distributors and streamlines the distribution channel and networks. This in turn enhances the efficiency of the supply chain.
This helps to eliminate overstocking and stockouts. The sales and distribution management system software make things easier and achieve your task effectively with less time and reduced effort.
Need for the Distribution Channel Strategy
A Distribution channel strategy enables you to optimize distribution channels through which your products travel from business to end customers. Distribution strategy is crucial to take care of because it can also affect your success with customer fulfillment.
The product begins from the manufacturer to the distributors to various markets such as wholesale or retail markets and finally to the customers.
The way the customers receive products will enhance the customer experience. It is essential to optimize your distribution channel management.
If you are spending a good time optimizing distribution channel strategy, that means that you are losing an opportunity. But what are the challenges faced in optimizing distribution channel management? Here are the top 5 distribution challenges and their solutions.
Major 5 Distribution Challenges to be solved
Challenge 1 : Inventory management
Inventory management is an essential part of your business that provides the details of stocks in and out of your business. As a distributor, you definitely need to know the stock availability and stock running out every moment of your business for uninterruptable, fast, and efficient operations.
Earlier inventory is managed in the small room and tracking the stocks in and out of your business manually but to compete in the age of e-commerce it became inefficient.
It is crucial for the distributors to know the real-time end-to-end visibility of the stock levels, supply chain, and logistics. When reordering the warehouse staff need not search for the availability of stocks, it is necessary to locate the stocks exactly for effective operations.
Here comes the necessity of a backend system that precisely tracks all inventory. Distribution ERP helps in managing the warehouse. It tracks the availability of stocks and continuously updates the in and out of the stock in real-time in the cloud.
It reduces the manual tasks and precisely manages the inventory. It allows you to track the inventory of your business regardless of the geographical location. This software is extremely cost-effective, allows optimal resource usage, and is powerful.
A Modern inventory distribution management system integrated with Artificial intelligence also allows you to predict and analyze the need of your business stocks every month and helps you to manage inventory accordingly.
Challenge 2 : Age of E-Commerce
The Emergence of e-commerce platforms has increased competition for distributors. Modern distributors are selling their products online directly to consumers. Digital transformation of the modern distribution system has become the latest trend.
Businesses are using e-commerce techniques to attract, grab and retain new prospects and customers. As the entire business is shifting to the emerging new technology platform, there are as well major challenges and issues to come across on the way to success.
Here comes the importance of an efficient sales and distribution management system. An effective distribution system helps you to stand out in the e-commerce competition world. Best distribution management system software helps you to overcome this challenge.
The E-commerce platform is new for some of the distributors. It is crucial for the distributors for a greater web presence and backend system to connect to online marketplaces and selling platforms.
Best distribution software stores the important information on the cloud to access it anywhere, anytime which helps distributors to track the orders and sell their products.
Challenge 3 : Shipping errors and Returns
Businesses should be customer-centric, and the best customer service earns customer loyalty. This in turn gets more referrals to your business.
But in an e-commerce business providing the best customer service is just a few clicks away. This has become a key differentiator for modern distributors.
It is one of the major challenges for the distributors to accurately fill the customer orders and reduce shipping errors. Shipping errors can be of any form like mistakes in shipping details, any product shortage, damage, picking error, warehouse error, labelling error, or an ordering error.
While updating these details of business operation manually leads to such kind of error, and that leads to poor customer service. It is a must for the business to keenly keep an eye on the order details, inventory, warehouse management system, and logistics.
Best distribution ERP enables you to keep updated on these details in a single platform in the cloud. This allows you to reduce shipping errors and negligible return orders of your products or services. Best distribution ERP enables you to provide better customer service and retain your customer relationship for the long run.
Challenge 4 : Forecasting and Reporting of Stocks Requirement
As said earlier inventory management plays a crucial role in businesses. Managing the right levels of stocks is always tricky for distributors. If more numbers of stock are purchased than the selling rate, then it results in reduced cash flow and increases the risk of unsold stock. On the other side shortage of stocks may even destroy the distribution business.
Competition among distributors increases as the retailer’s expectation of fast shipping with a wide range of products on demand must be kept in stock on variable sales cycles. It is crucial to forecast the stock requirement at every sales cycle.
Modern distributors are switching to the sales and distribution system software to get real-time reporting of their business rather than cyclical reports. This enhances the accuracy of forecasting stock levels and justifies the right amount of stock levels to be purchased.
Challenge 5 : Managing Your Relationships
In today’s world, customer expectations are very high. Whether you are in the B2B or B2C distribution business, meeting these expectations has become a critical component of success. Keeping on top of your customers’ communication is a complex process. Many companies fail to build relationship building which is required for business success. it is challenge for business to ensure that you have all your contact and transaction data available at anytime via laptop, tablet or smartphone
To remain competitive in the face of evolving customer expectations, it is compulsory to manage your communication processes. No one likes to explain their requirements, again and again to staff. If the CRM (Customer Relationship Management) System is integrated with your DMS, it takes care of customer enquiry that is available at one touch of a button and you will be fully informed.
Challenge 6 : Disconnected business applications
With the use of a legacy backend system, it is difficult to address the above challenges. Integration of business applications is difficult in the legacy backend system.
Legacy backend systems are slow and have a lot of difficulties in connecting with e-commerce platforms. Wholesale system software with good integration of business applications is required for the wholesale distributors.
It becomes critical for the wholesale distributors to manage the distribution system with the disconnected IT system. Modern distributors are shifting their backend IT systems to the cloud.
The emergence of cloud computing technology has become a boon for the modern distributor. This cloud-based sale and distribution management software removes the headache of setting up your own server, maintenance, integration difficulties, and more.
Modern distribution management software allows you to operate fast, efficiently, and effectively. This makes your business stand out from competitors which increases your business effectiveness and generates more revenue. This best sales and distribution software enables you to analyze and forecast your business with effective business operations.
It is crucial for businesses to grow with the best sales. Best sales and distribution management software allows you to keep the complete details of your business operation in one platform on the cloud. Best distribution software like Salesbabu distribution software enables you to keep track of inventory management, and warehouse management that helps you overcome the challenges.
Using wholesale distribution software allows for forecasting the stock requirements at every cycle with real-time data analysis. It also helps you track and maintain the right level of stocks, reduce errors, and integrate easily with other business applications. This distribution software is a powerful booster to face challenges in your business and pave the right path for the success of your business.