Importance of Distribution Management System in FMCG
All products go through a process cycle and various stages from the manufacturing unit to the last destination before getting to market. The product then delivers to customers through wholesale dealers or retailers. Today, developing markets are enormous and intricate, with thousands of distributors, outlets, and separate transactions. Manufacturers have to handle all these big and small distributors and fiddle with various channel requirement requirements. It’s a challenge for manufacturers to operate with limited data resources on the market. How will manufacturers manage different promotions, activities and handle people in a cost-efficient manner? Here is where the distribution management system comes to the rescue.
Challenges In Distribution Management
1. Markets have small distribution networks, unorganized entities with inadequate capital and infrastructure.
2. Multi-brand distributors find it challenging to manage various data points
3. Big distributors are short of actionable data and information
4. Adding several chains of distribution to penetrate the market is not cost-efficient.
5. Shortage of real-time data on inventory, orders, claims, and returns leads to stockouts or overstocking.
6. Distribution networks have Logistics issues, infrastructure challenges, and internet facilities in the distribution networks.
7. Collecting and managing invoices in the distribution cycle chain is cumbersome and time-consuming.
Let’s bring back our attention to the benefits of using a Distribution Management System, and they are as follows.
1. Real-time visibility
An FMCG company must have clarity on the visibility of all business data from distribution channels. The offline data may not be realistic or authentic collected from the distributors. It would be best not to settle for basic crucial information like current stock availability, pending orders or fulfillment, products returned by the retailers, etc. Distribution Management Software can provide much detailed information in real-time and is the need of the hour.
2. Managing Remote place scenario
FMCG companies interact with distribution networks in all districts to initiate product management from manufacturing plants to retailers. It is challenging for companies to manage the large volume, time management, and interior distributor location to move the products smoothly. Distribution Management software helps you get all data quickly, even if the distributors function from far remote places or geography.
3. Big boon for distributors
Distribution Management System is a solution aimed to help streamline, automate daily processes. All goods movement, invoicing, outstanding payments, intelligent alerts can be automated with accessible software.
4. Easy claim settlement
The Distribution Management System helps distributors with easy claim settlements. An automated distribution management system clarifies return schemes and damaged receipts on the delivery and payable items. Since the process is centralized, all claims are visible and processed quicker than a manual system that requires multiple rounds of modifications between parties.
5. Better Management of promotion and schemes
Promotion and schemes are crucial for any business, and an organization spends huge costs on these practices. Distribution Management software assures checks and balances during invoicing and provides a precise analysis of performance.
6. Quicker Stock replenishment
FMCG companies need to maintain stock levels at various points like stockiest, distributor, retailer, etc. Distribution Management software gives visibility of stocks, expiry date, batch number, return items, and many more.
7. Better Production planning
Distribution Management software, when integrated into the demand planning module of ERP, provides effective production planning. Afterward, production planning of your ERP will have clarity in the current stock level, pending orders, or fulfillment at the distribution level.
The retail level saturation and product overflow made distributors vital for a business to optimize FMCG channels. Implementing the software helps to be time and cost-efficient, which spirals the organization’s success and revenue. The small-sized organization also should invest in a Distribution Management software system for optimized functioning of business activities.
A sound distribution management system streamlines distribution workflows, supply chain activities, and stock management and helps companies get real-time data. You can achieve high success rates in your business activities, high performance, and staggered markets to provide complete visibility of sales stocks or stocks with a distributor.
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