ERP (Enterprise Resource Planning) for distribution is a tool for handling all of the transactional activity associated with an inventory-based business. Distribution activity is crucial to the successful flow of production, processes and payment. Smaller businesses have typically continued to approach distribution as a more hands-on kind of activity that can occupy a significant portion of operations. Until recently, smaller business concerns have found ERP for distribution out of budgetary reach. Access to ERP for distribution to businesses with low reserves of capital has increased with the introduction of SaaS (Software as a Service) and hosted software subscription delivery method.
Good for Business…all businesses, great and small
Much more attainable for those companies that do not have the information technology allowances of larger businesses, cloud –computing and ERP for distribution systems specifically intended for SaaS usage, provide a tool by which small and medium sized businesses can take part in the best practices and efficient methods available to them by virtue of internet, ERP and interfaces. Since the shipping of an order is the usual trigger for billing and the receipt of funds, the smooth flow of monies into company coffers is very important.
SAP and Oracle developed products designed with the needs for small and mid-sized companies. Epicor provides leased and subscription based financing options for this market. NetSuite and Microsoft (Dynamics) have made SaaS versions their ERP for distribution software packages. Growing out of the recognition of the existence of this underserviced market, the software giants are working to claim their portion of the business.
The Internet has turned every business, regardless of size into a global concern. Small companies routinely ship overseas or receive parts and materials from international suppliers. The internet has transformed business in a way that has changed the market and grown it to global proportions. International transactions and differing customs regulations mean that multi-national capability is a requirement of more and more businesses.
Initiating production planning and activity via EDI (electronic data exchange) is a functionality that SaaS ERP for distribution has made available to the business masses. Receipt of EDI data can automatically initiate the planning, scheduling and fulfillment or orders within designated parameters. Best practices contribute greatly to the adoption and implementation of Lean Manufacturing practices so popular in the tightly run businesses of today. ERP for distribution is one device that can most effectively be used to trim the fat.
Transactions and activities that once took days now get processed in milliseconds. Payment can be automatically generated by a receipt transaction and some business to business organizations have all payment set up that way when there is repeat business. For suppliers, ERP distribution system and ACH (automated clearing house) payment processing makes great business sense by insuring payment and lowering administrative costs. Managing inventory can be an issue even when the business is small and keeping track of what is on the shelves is keeping track of money. Profits grow in direct relation to how efficiently inventory is managed. With ERP for distribution now available to the business masses, small and medium businesses are holding their own in the global marketplace.