Positioned between product manufacturers and the businesses or individuals that need their goods, wholesale distributors play a crucial role in the global supply chain. By selling directly to end customers, distributing goods to retailers and/or fulfilling another intermediary-type position, these organizations are the tissue that connects producers with end users.
The arrangement is beneficial for all parties. Rather than setting up hundreds of distribution points near their end users, for example, manufacturers rely on wholesale distribution networks that shoulder that burden for them. Wholesale distributors also provide the customer service, support, expertise and value-added services that end users require, and on behalf of the manufacturers that they represent.
In the US, about 410,000 single- and multi-location wholesale distributors have combined annual sales of approximately $9 trillion. These organizations distribute both nondurable and durable goods and usually specialize by product category (although some offer a broader range of products and services). Some of the larger US distributors include Avnet (electronics), McKesson (drugs and medical supplies), and Sysco (foods). Globally, some of the biggest organizations in this category are Brenntag (Germany, chemicals), Medipal (Japan, drug and household products) and WPG (Taiwan, electronic components).
Get NetSuite in your corner
Like many business sectors, wholesale distribution is slowly shifting over to a more digitalized mindset. The persistent labor shortage, ongoing supply chain disruptions, rising costs and the desire to streamline operations and automate processes are all driving this trend. And while some distributors are still running their growing businesses on spreadsheets, manual processes and disconnected applications, many others are turning to unified, cloud-based enterprise resource planning (ERP) platforms like NetSuite for help.
With thousands of successful implementations, NetSuite helps wholesale distributors optimize their supply chains, create a modern sales experience and exceed the evolving expectations of today’s customers. With NetSuite in their corners, distributors can run their businesses on a single, unified platform reducing IT costs and gaining comprehensive, real-time visibility across their organizations.
The cloud ERP offers built-in workflows for all of a distributor’s core functions, including:
– Commerce: Omnichannel engagement brings together all customers and business activities.
– Inventory: Manage inventory and supplier relations more effectively. By optimizing inventory and supply chain management, distributors can speed up delivery times, increase sales, improve inventory turns and deliver the products customers want when they want them.
– Financials: A best-of-breed financial management application ensures world class accounting across the organization.
– Marketing: Real-time metrics and comprehensive data drive engagement with current customers and new market expansion.
– Sales: Unparalleled efficiency and visibility from lead to close, supports a sales effort that’s second to none.
– Orders: Omnichannel means accepting orders everywhere (online, offline, EDI and more) and fast-tracking order-to-cash.
– Sourcing: Ultimate control over procure-to-pay processes, improves supplier relationships, transparency and forecasting.
– Warehouse: Warehouse management system (WMS) functionality reduces overhead and cycle times while increasing inventory turns and on-time delivery rates.
– Support: Case management, return tracking and self-service client support help distributors run a truly customer-oriented business.
– Customization: Infinite extensibility that meets a distributor’s unique needs, growth and scale.
Using a fully-integrated, omnichannel software suite that connects all of their business operations, wholesale distributors can manage all aspects of their businesses on a single platform. Working with ERP Success Partners, companies can connect any outside applications directly into NetSuite and also build their own business rules into the ERP.
“To be successful in an omnichannel world, your wholesale distribution business must integrate all of its core business systems,” NetSuite points out. “Distributors that have connected the operations of their supply chain, CRM, retail channels, inventory and other processes will have the edge. However, most companies still struggle with disconnected data silos that don’t share information and can’t automatically pass an order from one point to the next.”
Leveling the playing field
As the traditional distribution model continues to evolve, success in this business sector requires keeping pace with changes in technology, workforce demographics, customer needs, pricing models and more. Distributors also have to be able to react and adjust to changes in the overall economy and the manufacturing industry as a whole.
NetSuite and ERP Success Partners can help companies achieve these goals…and more.
“NetSuite levels the playing field with a solution that modernizes your distribution infrastructure, enabling independents to operate efficiently and compete more readily against larger players,” it says. “Additionally, NetSuite grows with your business so you stay ahead of the curve year after year. By implementing the right technology to accentuate your particular offering of services and expertise, your wholesale distribution business can compete and succeed.”