ERP Software for Wholesale & Distribution

Wholesale and distribution ERP software enables companies in the wholesale industry to run more integrated business operations across their different departments. Often wholesale companies run their businesses on different systems and applications.

Inventory management might operate on spreadsheets or siloed applications, finance and accounting may be conducted on a standalone accounting software package, sales order and quotations are often compiled on a separate CRM. This can cause data integration issues which then leads onto real business impacts including late orders, decreased efficiency, a lack of business intelligence and ultimately poor profits and unhappy customers.

ERP software for wholesale & distribution solves this probably by simply making everyone run from the same system of record. Sales orders, inventory, finance, supply chain and procurement can all operate in one unified business system, allowing for seamless interaction between the different departments of your wholesale or distribution organization.

ERP for wholesale & distribution can vary in cost from $20,000 to several millions in Year 1. The cost of wholesale ERP software will largely vary dependant on the size of your business, the ERP solution you choose to implement, the scope of your implementation, as well as your ERP implementation partner and their resourcing model.

Implementing a Distribution ERP (Enterprise Resource Planning) system is a complex process that requires careful planning, coordination, and execution. Below is a step-by-step guide to help you through the implementation process:

Planning Phase

1. Project Kickoff

   • Assemble a project team consisting of key stakeholders, IT professionals, and possibly external consultants.
   • Define the scope, objectives, and timeline for the ERP implementation.

2. Requirement Analysis

   • Document the specific needs and requirements of your distribution business.
   • Prioritize features and functionalities.

3. Budget Allocation

   • Determine the budget for the ERP implementation, including software, hardware, consulting fees, and training costs.

4. Vendor Selection

   • Choose an ERP vendor based on your requirements, budget, and their reputation.
   • Finalize the contract and terms of service.

Design and Development Phase

5. System Architecture

   • Decide whether the ERP system will be cloud-based or on-premise.
   • Plan the system architecture and how it will integrate with existing systems.

6. Customization and Configuration

   • Customize the ERP software to meet your specific needs.
   • Configure settings, workflows, and user roles.

7. Data Migration

   • Prepare your existing data for migration into the new system.
   • Perform data cleansing, mapping, and importing.

Testing Phase

8. Unit Testing

   • Test individual modules and functionalities to ensure they meet requirements.

9. Integration Testing

   • Test the interoperability of the ERP system with other existing systems.

10. User Acceptance Testing (UAT)

    • Involve end-users to test the system in a real-world scenario.
    • Collect feedback and make necessary adjustments.

Deployment Phase

11. Training

    • Train the staff on how to use the new ERP system effectively.
    • Provide documentation and resources for reference.

12. Go-Live

    • Once testing is complete and the system is stable, go live.
    • Monitor the system closely for any issues.

13. Parallel Run (Optional)

    • Run the new ERP system alongside the old system for a limited period to ensure data accuracy and process integrity.

Post-Implementation Phase

14. Performance Monitoring

    • Continuously monitor the system’s performance and resolve any issues that arise.

15. User Support

    • Provide ongoing support and training for users.
    • Set up a helpdesk or ticketing system for issue resolution.

16. Updates and Maintenance

    • Keep the system updated with the latest patches and versions.
    • Perform regular maintenance checks.

17. Review and Feedback

    • Conduct periodic reviews to assess the ROI and overall effectiveness of the ERP system.
    • Collect feedback from users for future improvements.

18. Scalability

    • Plan for scaling the ERP system as your business grows.

The best ERP software for distribution includes: 

1. SAP Business One
2. Infor CloudSuite Industrial
3. Oracle NetSuite
4. Epicor
5. Oracle ERP Cloud
6. Acumatica
7. Syspro
8. Microsoft Dynamics 365
9. SAP S/4 HANA
10. QAD Systems

Yes. With integrated CRM functionalities, an ERP system can help distributors to better understand their customers, track interactions, manage customer inquiries, process orders faster, and thus, provide an improved customer experience.

One of the core features of an ERP system for distributors is advanced inventory management. It can track inventory levels, optimize stock quantities, manage warehouses in multiple locations, handle reordering processes, and even predict future demand patterns using intelligent forecasting models.

The decision to have separate Enterprise Resource Planning (ERP) and Warehouse Management System (WMS) systems depends on various factors such as the size of your organization, the complexity of your operations, and your specific business needs. Here are some points to consider:

Advantages of Separate Systems:

1. Specialization: WMS systems are specialized for warehouse operations, including inventory tracking, picking, and shipping. ERP systems, on the other hand, are more generalized and cover a broader range of business functions like accounting, human resources, and customer relationship management.

2. Flexibility: Separate systems allow you to choose the best-of-breed solutions for each function, rather than being confined to the limitations of a single system.

3. Scalability: As your business grows, you may find that you need more advanced features in one area but not in others. Separate systems make it easier to upgrade or change one system without affecting the other.

4. Performance: Dedicated systems are optimized for their specific tasks, which can result in better performance and efficiency.

Disadvantages of Separate Systems:

1. Integration Challenges: Data needs to be synchronized between the two systems, which can be complex and costly.

2. Cost: Purchasing, implementing, and maintaining two separate systems can be more expensive than a single, integrated solution.

3. User Training: Employees may need to learn and adapt to multiple systems, which can take time and reduce efficiency initially.

4. Data Consistency: With two systems, there's a risk of data discrepancies if not properly integrated.

Advantages of Integrated Systems:

1. Unified Data: All data is stored in a single database, making it easier to generate comprehensive reports and analytics.

2. Cost-Efficiency: Generally, it's less expensive to implement and maintain a single system.

3. Simplified User Experience: Employees only need to learn one system, which can improve efficiency.

4. Streamlined Processes: Integrated systems often allow for more streamlined operations and easier automation of tasks across departments.

Disadvantages of Integrated Systems:

1. Limited Features: An integrated system may not have all the specialized features that a dedicated WMS or ERP system would offer.

2. Complexity: Because they cover so many aspects of a business, integrated systems can be complex and cumbersome to implement and manage.

3. Vendor Lock-in: You're often tied to a single vendor for all your business software needs, which can be limiting.

Buying a Distribution ERP (Enterprise Resource Planning) system is a significant investment that requires careful planning, research, and execution. Here's a step-by-step guide to help you through the process:

Preliminary Steps:

1. Identify Needs: List down the specific requirements you have for a Distribution ERP system. This could include inventory management, order processing, shipping, customer relationship management, etc.

2. Budget Planning: Determine the budget you are willing to allocate for the ERP system. Keep in mind that costs can include software licenses, hardware, implementation, training, and ongoing maintenance.

3. Stakeholder Involvement: Involve key stakeholders from different departments like sales, warehouse management, and finance to understand their needs and challenges.

Research:

4. Vendor Research: Look for reputable ERP vendors who specialize in distribution or have modules tailored for distribution businesses.

5. Request for Proposal (RFP): Create an RFP document outlining your requirements and send it to shortlisted vendors. This will help you get customized solutions and pricing.

6. Demo and Trials: Schedule demos with the vendors to see the ERP system in action. Some vendors may offer a free trial.

Evaluation:

7. Compare Features: Evaluate the features of each system against your requirements.

8. Check References: Speak to current or past clients of the vendor to gauge their satisfaction and the system's performance.

9. Cost Analysis: Look at the total cost of ownership, including hidden costs like customization, upgrades, and additional modules.

Purchase and Implementation:

10. Negotiation: Once you've selected a vendor, negotiate the terms, pricing, and any customizations.

11. Contract Review: Carefully review the contract and ensure it includes all the agreed terms, support, and maintenance details.

12. Implementation: Plan the implementation process, which may include data migration, customization, and integration with other systems.

13. Training: Train your staff on how to use the new ERP system effectively.

14. Go-Live: Once everything is set up and tested, you can go live with the system.

15. Ongoing Support and Maintenance: Ensure you have a support and maintenance agreement in place for ongoing needs.

Additional Tips:

• Consult Experts: It may be beneficial to hire an ERP consultant to guide you through the selection and implementation process.

• Scalability: Make sure the system you choose is scalable to accommodate future growth.

• Data Backup: Ensure that the system has robust data backup and recovery features.

• Compliance: Make sure the ERP system complies with industry standards and regulations.

By following these steps and considering the various factors involved, you can make a more informed decision when buying a Distribution ERP system.

Evaluating a Distribution ERP (Enterprise Resource Planning) system is a critical step in ensuring that the software meets the specific needs of your distribution business. Here's a comprehensive guide on how to evaluate a Distribution ERP system:

Define Objectives and Requirements

1. List Business Objectives: Clearly define what you aim to achieve with the ERP system, such as improved efficiency, real-time tracking, or better customer service.

2. Gather Requirements: Involve stakeholders from various departments like sales, inventory management, and finance to compile a list of features and functionalities needed.

Preliminary Research

3. Market Research: Research potential ERP vendors who specialize in distribution or offer modules tailored for distribution businesses.

4. Request for Information (RFI): Send out an RFI to shortlisted vendors to gather preliminary information about their offerings.

Request for Proposal (RFP)

5. Create an RFP: Develop a detailed Request for Proposal outlining your specific requirements, budget, and timelines.

6. Send RFPs: Send the RFPs to the shortlisted vendors and request customized proposals.

Vendor Demos and Trials

7. Schedule Demos: Arrange for live demonstrations with each vendor to see the ERP system in action.

8. Trial Period: If possible, opt for a trial period to test the system's capabilities and how well it integrates with your existing processes.

Evaluation Criteria

9. Feature Comparison: Create a matrix to compare the features of each system against your requirements.

10. User Experience: Evaluate the system's user interface, ease of use, and the learning curve for your team.

11. Scalability: Assess whether the ERP system can scale with your business growth.

12. Integration: Check how well the ERP system can integrate with your existing systems and third-party applications.

13. Customization: Determine the extent to which the system can be customized to meet your specific needs.

14. Compliance and Security: Ensure the system complies with industry regulations and has robust security measures in place.

15. Total Cost of Ownership (TCO): Consider all costs, including licensing, implementation, training, maintenance, and upgrades.

16. Vendor Reputation: Research customer reviews, ask for client references, and possibly visit companies where the ERP system is already implemented.

Decision Making

17. Scorecard Method: Use a weighted scorecard to rate each ERP system based on the evaluation criteria.

18. Consult Stakeholders: Share the evaluation results with key stakeholders for their input before making a final decision.

19. Negotiation: Once a vendor is selected, negotiate contract terms, pricing, and any customizations.

20. Contract Review: Thoroughly review the contract to ensure it includes all agreed-upon terms, including support and maintenance.

By systematically evaluating each ERP system based on these criteria, you'll be better equipped to select a solution that aligns with your business objectives and operational needs.

• Distribution ERP (Enterprise Resource Planning) systems can be quite comprehensive, offering a wide range of features to manage various aspects of a distribution business. However, the exact features can vary depending on the vendor and the specific needs of the business. Here's a list of features commonly found in Distribution ERP systems:
• Core Features

• Inventory Management

  • Stock tracking
  • Reorder levels
  • Multi-location support

• Order Management

  • Order entry
  • Order tracking
  • Backorder management

• Warehouse Management

  • Picking and packing
  • Bin and location tracking
  • Shipping integration

• Purchasing

  • Purchase orders
  • Supplier management
  • Procurement analytics

• Sales Management

  • Customer relationship management (CRM)
  • Quotation management
  • Sales analytics

• Financial Management

  • General ledger
  • Accounts payable/receivable
  • Budgeting and forecasting

• Reporting and Analytics

  • Customizable reports
  • Dashboards
  • Data visualization

• Advanced Features

• Demand Planning

  • Forecasting
  • Seasonal demand analysis

• Transportation Management

  • Route planning
  • Freight management

• Quality Control

  • Inspection management
  • Compliance tracking

• Human Resources

  • Employee management
  • Payroll
  • Time tracking

• E-commerce Integration

  • Online order processing
  • Customer portal

• Multi-Currency and Multi-Language Support

  • Currency conversion
  • Language localization

• Document Management

  • Document storage
  • Workflow automation

• Customer Service

  • Ticketing system
  • Customer feedback

• Production Management

  • Bill of materials (BOM)
  • Work order management

• Barcode Scanning

  • Inventory scanning
  • Order verification

• EDI (Electronic Data Interchange)

  • Automated data exchange
  • Standardized communication

• IoT Integration

  • Sensor-based tracking
  • Real-time analytics

• Mobile Access

  • Mobile apps
  • Remote access

• Cloud-Based or On-Premise Deployment

  • Data storage options
  • Scalability

• Security Features

  • User permissions
  • Data encryption

• Audit Trails

  • Change logs
  • Compliance reporting

• APIs for Custom Integration

  • Third-party integrations
  • Custom development

• Disaster Recovery

  • Data backup
  • Failover support

• This list is not exhaustive, and some ERP systems may offer additional specialized features based on industry-specific needs.