3 Trends Driving Growth in the Wholesale/Distribution Industry

September 3, 2015

Wholesale Distribution TrendsDistribution businesses have become increasingly complex with ample opportunities to serve many different customers globally. In the United States alone, wholesale/distributor sales equal approximately $3.2 trillion, which also accounts for roughly 7% of private industry GDP since 1987[1]. The reason for such staggering numbers is partially because distribution spans many large market segments, ranging anywhere from grocery and food-service to furniture and home furnishings. Driving this growth are 3 factors that distributors are finding increasingly important:

(1) Investment in Technology:

Many distribution business owners are beginning to realize the importance of making data-driven business decisions. Unfortunately, many companies are currently stuck using older software systems which are not providing relevant information in a timely and effective manner. As a result, the focus has shifted to implementing truly integrated software that will tie the different facets of the business, (such as order taking to warehouse management to accounting) together. The result for companies who move in this direction is a system that provides real-time information across departments in a timely manner to facilitate effective decision making. For example, a salesperson on the road will need access to updated pricing, product availability, and customer information among many other pieces of information. This highlights the importance of a system that will provide information to all areas of an organization, be it in the warehouse or on the road at a customer’s location.

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Blue Link ERP – Product Spotlight Video

September 1, 2015

News Release: Blue Link speaks with TechnologyAdvice.com about Blue Link’s Inventory and Accounting ERP software.

The following summary post is from TechnologyAdvice.com, a website that provides reviews and rankings of business software, including customer relationship management tools, the best ERP software, and more.

Recently our very own Samantha Hornby, spoke with Eric Perry of TechnologyAdvice to go over a few features, best practises and what makes Blue Link ERP software unique.

Samantha described how Blue Link ERP is an all-in-one inventory management system and accounting ERP system targeted at small to medium sized businesses with approximately 5-100 people. Check out the full interview video or read below for a transcript of the conversation.

TA: Welcome Technology Advice viewers to this week’s product spotlight.  I’m joined today by Samantha Hornby, the marketing manager of Blue Link, an ERP software provider.  Samantha, describe Blue Link ERP in one sentence.

Hornby: Blue Link ERP provides inventory management and accounting ERP software for small to medium size businesses, primarily those in the wholesale and distribution industry.

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Beware the RFP When Evaluating Wholesale Software

August 28, 2015

RFPYou may have heard the term RFP before used in a business setting, or perhaps your company has even considered issuing one.  For those unfamiliar with the term, RFP stands for “Request For Proposal” and according to Wikipedia is “a solicitation, often made through a bidding process, by an agency or company interested in procurement of a commodity, service or valuable asset, to potential suppliers to submit business proposals.” RFP’s are often preceded by either an RFI or RFQ  – or sometimes both.  An RFI is a Request for Information and an RFQ is a Request for Quote.

RFPs are used in a variety of industries and can be submitted when companies wish to receive information about specific wholesale ERP software.  In general issuing an RFP informs the software vendor that your company is actively searching for a new system and provides additional information such as:

  • Background information on the company and how it operates
  • What prompted the search and where the need for software derives from
    • This includes information on current challenges and opportunities
  • What specific functionality is required
  • Who will be competing for the final sale
  • The process for making a decision

Due to the amount of information included in a typical RFP, the documents themselves are quite long.  Taking this approach to finding a new software solution may seem beneficial, but these types of documents are becoming less and less common and are not ideal for smaller businesses.  Below we have highlighted some important factors to keep in mind before deciding to issue an RFP, RFQ or RFI.

Are you able to document your existing processes in significant detail?

Small businesses may not have formal procedures in place to document and submit as part of an RFP.  In this situation it is often while working through the sales process and having discussions with software vendors, that businesses are able to better identify their existing processes and areas for improvement.  Many small businesses take advantage of speaking with software vendors to get advice on how to best improve their existing processes and how software can help them achieve this.

In addition, for businesses coming off of introductory type systems, they may not be fully aware of all the features available to them as part of a proper wholesale solution.  This can make documentation difficult and time consuming and can result in incomplete information.

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Which food distribution software do you need?

August 26, 2015

Food Distribution SoftwareOver the years we have had discussions with many companies in the food wholesale and distribution industry who were looking for software suitable for their business.  Most of these companies were looking for capabilities which are commonplace in many food distribution solutions including lot tracking/traceability, landed cost tracking, flexible pricing and multiple units of measure.

Although these features will fulfill the requirements of many in the food wholesale and distribution industry, depending on the specific activities and product mix of your business, there may be additional requirements.  The biggest differences amongst appropriate software solutions is when it comes to “catch weight” functionality.  Companies dealing with canned foods, frozen or dry goods can benefit from ERP software with food distribution specific features.  However, when speaking with food companies that deal with meat, fish, poultry, produce or dairy the term catch weight often becomes part of the discussion.

Catch Weight:

If used in your business, catch weight may be the key determinant in which software you choose.  Commonplace in businesses dealing with produce, meat, poultry and fish this term generally refers to the specific weight of a specific batch of product which is close to the average or standard weight used for that product.  For example you may sell a 16lb case of lamb chops, but depending on the actual cuts of meat in the case it may only weigh 15.7lbs or maybe 16.3lbs. You could have 20 – 16lb cases each with a different actual weight.  How will these be stored in your inventory?  Will you sell them each for the same price or will they be sold by their precise weight? Will you break open a case and sell by smaller weights? When it comes to catch weight functionality it is important to know your requirements, as this is only one version of catch weight and there are many others out there. A potential software provider may tell you that their system can deal with catch weight, but if they define it differently than you do, it may not meet your needs.  In order to avoid any confusion, make sure you have a clear understanding of your requirements and be as specific as possible when speaking with software vendors. If you do require catch weight functionality make sure that it becomes an integral part of your search, and don’t waste your time looking at software without it.

For those businesses dealing with canned, frozen and dry packaged goods, in which the weights and sizes will be standard each time, it is unlikely that you will require catch weight functionality.  This can potentially provide you with more software options to choose from with lower price tags.  In this situation an integrated ERP solution with specialized food distribution features such as the following is likely what you will need to run your business.

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Reduce Bad Data with Accounting ERP Software

August 21, 2015

Duplicate Product Error MessageAccounting processes are an integral part of business management and include managing your company’s accounts receivable, accounts payable, general ledger and dealing with banking.  Depending on the size and sophistication of your business, you may be able to use manual methods of data entry and calculation, or perhaps an introductory accounting system.  However, in order to meet standard accounting regulations, and ensure a high level of data accuracy, as the business grows more sophisticated accounting ERP software is your best choice.  Accounting ERP systems provide many benefits including:

  • The ability to manage multiple currencies and multiple companies
  • Real-time posting in which the software automatically posts to general ledger when processing invoices, payments or any other transactions
  • Automatic emailing of statements
  • Posting integrity controls to prevent a business’s books from going out of balance and to ensure a trail of entries, adjustments and transactions for auditing purposes

These benefits, however, are only as good as the data actually being input into the system.   Poor data input is a common issue, especially in smaller organizations with less formal procedures in place.  As an example, consider the accounts receivable function. Attention to data quality in your billing system profoundly affects the collection and reporting of revenue. The more incorrect data in your database, the longer it takes to collect revenue.  The consequences of mailing invoices to the wrong address (or emailing to the wrong email address) are obvious.  This also applies to sending information to the wrong contact at each company.  Accurate data collection helps avert this situation and protects the bottom line from inaccurate billing that might mask the real financial picture. Moreover, it prevents unnecessary referral of accounts to collection agencies because of incorrect data.

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Inventory Management Techniques: Cycle Counting

August 18, 2015

cycle counting in the warehouseCycle counting often comes up in discussions surrounding proper inventory management, but what does it mean and how do you incorporate it into your business processes? In this article I’ll attempt to demystify the term and further explain how regular cycle counting is important for small and large companies, for better inventory management.

What is cycle counting?

Cycle counting is used as a tool to monitor variances in inventory.  It involves regularly counting a small subset of inventory at a specific location on a specific day, with the intent of cycling through the entire inventory over a period of time, and then repeating.   With any wholesale distribution company, there will often be some sort of variance between the inventory items you have on file vs. what you physically have in your warehouse.  This is a result of product getting misplaced, extra items being sent out with bulk orders, human error, shrinkage, etc.

Determining this variance only at the end of the year can result in greater discrepancies and therefore shock from management.  Regular cycle counts help your business keep a closer eye on this variance and make necessary process changes according to the results.  Ultimately, regular cycle counting should result in detailed procedures that yield very low variance levels and a high level of inventory accuracy.

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5 Questions to Ask Yourself before Speaking with Software Vendors

August 13, 2015

software search questionsSo you’ve decided it’s time to upgrade your business back-end accounting and inventory management systems to something more modern and sophisticated.  This can be a great opportunity for your business, and having all key stakeholders on board with the change is the first step in getting the system you need.  Other steps in the process include setting priorities, evaluating requirements, and searching for and speaking with vendors.  Before you even start the process though, there are a couple questions that should be evaluated internally before you hit the ground running. We have outlined these further below:

1. What do you perceive as your businesses greatest strength? Weakness?

Taking an internal look at the strengths and weaknesses of your business will help you identify areas where software can make improvements. Do you provide excellent customer service but frequently make shipping errors? Do you have a great eCommerce site, but it’s not integrated with your inventory system? Taking stock of these different strengths and weaknesses can also provide you with a benchmark for comparing processes once a new system is in place.  Make sure you question existing processes, and be open to making changes if there are benefits to be gleaned.  For those processes that are unique and beneficial to your business, find a software vendor who is able to accommodate them.

2. What are your buying criteria and success criteria?

This question ties in with the above, in that it gets you to start thinking about how the success of implementing new software can be measured.  Will you evaluate the software against number of man-hours a task previously took? Will you be looking at costs saved with better inventory management? Will you be analyzing employee morale? Starting with a list of goals you want to see accomplished with new software as part of your buying criteria will enable you to make comparisons down the road.  This type of information can also be analysed during the sales process.  A good software vendor will spend the time reviewing these specific processes and identifying ways that they can be improved with a new system, focusing on tangible values.

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