The Eight Necessities in Distribution Software – An Inside Look

SBS Group has been providing software solutions for nearly 30 years and the distribution industry has been a major area of focus throughout our history. After sorting through questions and concerns from distributors over the past few years, we were able to identify 8 features that distributors find critical in a software solution. These data includes organizations of all sizes throughout the United States, and primarily cover the consumer goods and retail distribution industries.

8. E-mail Marketing (14% cited as major concern)

As more organizations take the approach to cross-train employees, software solutions are adding more and more interdepartmental features to ensure all needs are met. Experienced distributors want more control over their marketing campaigns and insights towards where marketing dollars are being spent.

7. Specific User Rights (21%)

With the wide-ranging features throughout modern ERP distribution systems, certain employees only need access to a specific tool or view in the system. Cutting down on the unnecessary clutter, and keeping sensitive information out of the reach of the entire organization are increasingly popular requirements. Specific user rights allow each employee authorization over their responsibilities and nothing more.

6. Customization (29%)

Customization is key to running an ERP system. There are dozens of features and add-ons to make a system work better for your organization. One of the most difficult challenges for distributors is the high cost of implementing and consistently maintaining a customized solution. Distributors are taking advantage of competitive pricing from Independent Software Vendors (ISVs) that focus specifically on their product, which leads to more reliable support.

5. Reporting (36%)

No organization can stay away from “big data”. Business Intelligence and data mining are increasingly popular demands in the distribution industry. Organizing and analyzing information is a time consuming task, with distributors calling for easily transferable data and reporting functionality. The top reporting priorities for distributors are inventory trends, financial statements, and logistics.

4. Real Time Visibility/Mobility (43%)

Although less than half of the distribution organizes specifically requested an improvement in real time visibility and mobility, this was one of the primary concerns of smaller organizations that relied on Excel sheets or QuickBooks. As distribution organizations grew and began to reach the “next level” we found that more and more of these organizations were no longer getting their information at a quick enough pace. With warehouses growing and orders constantly in transport, it quickly became crucial to spot any irregularities in real time, including out in the field.

3. Inventory Tracking/Management (57%)

More than half of our customers cited significant problems with the lack of inventory management, specifically tracking items and orders. The major complaint is that inventory is not precise where the “count is always off” and if there is any breakdown in the communication process, employees have a difficult time tracing inventory back to orders. Current technology provides distributors of all sizes with affordable access to accurate inventory, warehouse, and transportation tracking systems.

2. Automation (79%)

The feature at the heart of a distributor’s ERP system is automation. Manually processing orders or taking stock of inventory are problems that distributors should not have to face. Nearly 80% of our surveyed distributors are making the move to an automated solution for their employees, warehouse orders, financial statements and customer data. With the additional of automated workflow, the right people are notified when stock is running low, customers need a renewal, or a shipment is delayed – all without any manual input.

1. Centralized Application (93%)

Organizations using multiple, independent tools find themselves jumping from screen to screen and manually inputting/interpreting data. Having a centralized system with the ability to easily integrate additional solutions was the top priority of distributors. The ~7% that did not cite needing a centralized application as a major concern did not yet have any ERP software in place.

As technology continues to grow, distributors focus on adopting at a big-picture level, seeking significant improvements. Tools that support supplementary features, such marketing and reporting, are important but not as crucial as implementing a centralized, fully automated tracking system. The purchasing trend seems to be moving toward simplicity and reducing the number of steps it takes to complete previously tedious processes.