What Is Distribution Management?
Distribution management is about effectively managing the movement of goods as it travels from the wholesaler to retailer to the consumer, to stay competitive, cost effective, and on the top of your customer's list of distribution service providers.
Distribution processes are complex, and require airtight management because of various dynamic factors; buyers’ demands, shipping speed, and supply chain blockages, causing potential delays. A smart logistics system can help you address all these and take care of the packaging, routing, warehousing storage, and fleet management, keeping the whole process low-cost and efficient.
Disrupt your distribution management to: prevent losses and ensure consistent services, reduce shipping costs and timings, improve efficiency, allow for resilience towards market changes, support new business models and re-imagine existing ones.
Image Caption: Why Businesses need to adopt smart Distribution Management Solutions
Emerging Distribution Trends
The supply chain management market was valued at $18,699.45 million in 2020 and is projected to reach $52,632.37 million by 2030 (source: digitaljournal.com). This industrial-grade digital technology need arose from business owner’s inclination towards cloud-based supply chain management in the face of poor infrastructure, increasing security and privacy concerns, and these changing market dynamics:
Need for Visibility and Transparency in Processes and Data
A lack of transparency into data and processes has been the biggest hurdle in distribution management, as businesses had no visibility into what was happening on the field and warehouse—also leading to poor business predictability. They needed data, knowledge, and capabilities to control the whole distribution scenario. Leaders are fast adopting data analytics to harness data intelligence and gain transparency in supply chain management, which helps in accelerating the time-to-market of products.
Rising Security and Privacy Concerns Among Businesses
With every business possessing some critical data that needs to be protected at every cost, breaches can mean huge losses and security loopholes. The leakage of this data can put any business in a vulnerable position, so they rather opt to restrain their business growth and avoid scaling up to avoid such situations. However, smarter businesses are adopting cloud-based software to address these security and privacy issues and build a robust distribution management.
Availability of Smart Tools and Technologies for Distribution Management and Fleet Management
A report by SOTI shows that 42% of British transport and logistic companies (49%) globally are still using legacy systems and technologies, one-third also admitting that this restricted their ability to scale up their business during the crisis brought by pandemic. While the other businesses that had smart technologies in place for fleet management and complete supply chain management could make some significant growth.
The companies who still don’t analyse the supply chain disruptions that they are encountering regularly, due to a lack of visibility and coordination, will remain unprepared for unforeseen circumstances and problems, making their businesses vulnerable. Hence, the trend of tech adoption is growing among businesses who want more control over their product distributions and an opportunity to scale up when the opportunity knocks at the door.
Read how Manchester-based KHB Craft Bakery streamlined order-to-cash cycle, improving customer service and reducing admin with a digital solution.
Image Caption: Technology Imperatives for Distribution Management
Top 7 Distribution Processes that Can be Managed More Effectively with a Smart Solution
Sales Order Management
A distribution management tool will help you process and monitor the order places and track them quickly. The right system will help you have the entire order lifecycle operate smoothly, right from the registration of a new client update on the delivery made to them. Distribution software automates order processing by collecting data from the customer and creating an order for the ordered products. You can easily track orders in real-time at any point in the order lifecycle by checking status updates.
Monitor the fleet, following its actions anywhere anytime, ensuring it is efficient, at the lowest cost, and on time. You get complete control over the decisions like asset management, vehicle acquisition, route, current status, and disposal.
Warehouse management automates the collecting, packing, and shipping process. This ensures accurate data on your inventory, seamless communication across, and a smooth warehousing process thereafter. Seamless communication for a distribution business results in flexibility to operate effectively without manual updates from business to customer, improving customer service in the process, eliminating the scope of error and making the process easier. Besides, streamlining these processes leaves a lot of spare time for your employees to put efforts into more productive places.
Centralise your procurement activities so that you can also quickly match your POs with accounts payable, facilitating the processing of payment faster. Procurement management provides you better and stronger control over inventory’s operational costs, also enabling administrators to monitor the stock levels, fill up for the falling stock level in time, and review budgets for acquiring new assets.
Inventory management allows you constant insight into the inventory stock, letting you control the asset movement and optimise it level. A strong inventory control that extends beyond the stock and shipment also allows you to conduct stock adjustments and make reservations. Gain visibility into demand analysis, product requirement forecast, manufacturing analysis.
A distribution management system also ensures good funds management, helping you with cost evaluation, financial planning, future analysis, asset depreciation analysis. The user can evaluate an investment from various vantage points and take the best decision for the business.
Integrations & Analytics
A distribution management system also records data from various activities and helps you interpret it for actionable insight. transforming unorganised data into useful statistics with Advanced analysis and reporting to impact the overall performance, profitability, and productivity of your business. Integrations are easy to handle, causing minimal disruption to business processes.
KPIs to Measure Successful Delivery Management
As you adopt a distribution management software/system, you need to evaluate the state of your delivery using some key performance indicators (KPIs). These are the top tools used to evaluate various areas of service.
Image Caption: Distribution Management KPIs that Help You Determine Success of Distribution Management
Evaluating the Importance of a System to Manage Distribution Processes
Good management is at the core of every successful distribution business. To be at the top of your industry, it is essential monitor the supply chain, measure daily performance, stay proactive, and be more impactful. Unfortunately, plenty of businesses are still functioning without any insight and control over the operations. Explore how your business can gain an insight into complete order lifecycle activities to muster complete control over it.
RouteMagic can help you evaluate the profits that a distribution management system can bring to your business.Talk to our experts to find out how it will work for your specific business model.