BLOG

How an ERP enables distribution automation

Take on other value-adding work and reduce the chance of expensive and time-consuming human error.

Download the ebook

Automating key tasks eliminates the need for human intervention, enabling employees to take on other value-add work and reducing the chance for expensive and time-consuming human error.

When it comes to wholesale distribution, the advantages of automation translate to better performance across the supply chain, improved inventory management, and reduced planning cycle times, alongside faster fulfilment and delivery. Everybody benefits, from stakeholders to warehouse workers on the ground, and every supply chain partner along the way.

However, automation is easier said than done, especially without the right tools. Today’s distribution automation requires the necessary software solutions, namely an advanced, intuitive and integrated enterprise resource planning (ERP) solution like NetSuite. This type of best-in-class resource planning system enables formerly manual processes to be handed off for automation, resulting in cost savings, efficiency and better productivity across the board.

But we didn’t just come here to tell you this - we’re here to show you how an ERP makes it all possible.

Why distribution automation is needed

Before we take a deep-dive into all the different processes you can automate through ERP technology like NetSuite, it’s important to understand why this automation is needed.

By now, you’re probably aware that automation can lead to considerable perks for you and your wholesale distribution company, including efficiency, cost savings, and the ability to reroute manual workloads from your employees to intelligent ERP software.

But there are a few other elements you should be aware of here, including the fact that automation is one of the best ways to help your distribution team keep up in the current wholesale landscape. Your supply chain has almost certainly become more complex over the last few years, particularly with the rise of new channels and increasing demands on the other end of the chain.

“Supply chains are becoming larger. The job of a supply chain manager is becoming increasingly complex - there are more items, more divisions, more options on items, more countries that they’re dealing with,” Oracle NetSuite Product Marketing Manager Gavin Davidson pointed out. “Having a flexible back-office business system that can enhance supply chain systems and grow with your business is a big factor in supply chain automation.”

The thing is, all the rising complexity distributors have seen in the last few years isn’t on track to slow down anytime soon. New technologies, increasing demands and changes to packaging and logistics will continue to emerge and make things difficult. But the good news is, distribution automation can help you adapt to challenges quickly and retain a competitive edge.

How distribution automation works

Automation in distribution has become pretty advanced and all-encompassing, and often involves more moving parts than you might think. Today, technologies like warehouse sensors, robotics and other artificial intelligence and connected IoT systems, are changing the way companies are structuring their supply chain.

At its most simple, distribution automation involves any technology or method that streamlines processes, removes the need for manual work, and tracks the activity taking place in the warehouse and throughout the supply chain - connecting the entire company.

Whether this activity is done by humans or robots, there’s quite a bit of data to keep track of. And this is where an ERP system comes in to simplify distribution automation.

What can you automate through an ERP?

In certain instances (like the ones we’re about to talk about below), automation simply isn’t possible without ERP software. After all, in order to automate, you’ll need the right software and technology in place to enable the handoff of formerly manual processes to their automated counterparts.

Let’s take a look at some of the key distribution processes you can automate through an ERP like NetSuite:

Inventory management

This one’s a biggie for distribution automation. If your inventory management processes aren’t in order, problems can quickly spiral out and impact the rest of your fulfilment and delivery processes. Bringing in automation here, can result in a 30% reduction in inventory costs, an 85% improvement in fulfilment rates and as much as a 30% decrease in planning cycle times.

NetSuite allows you to automate several different parts of your inventory management, including the ability to set specific benchmarks for inventory levels and automatically release product when supply is low. You can also automatically track where everything is within a multi-warehouse distribution network, so you have full visibility across the board and can balance your locational supply accordingly.

Accounts receivable

AR is an ideal candidate for distribution automation, and this is another area where an ERP solution can help. Automation here can take the form of the system sending out automatic reminders to customers about overdue account balances, as well as how to pay. All you and your team need to do is set up the parameters so the system knows when to send the notification.

Our NetSuite users have found that this can result in up to a 55% reduction in the time it takes to close the financial books, and as much as a 50% boost in accounting staff productivity.

Shipping

Advancing an order from “ready to pick” to “ready to ship” has never been smoother with distribution automation. Because NetSuite lets you customise the actions involved here, you can make sure that your automated shipping workloads follow along with what your workers are doing. The moment the order is fulfilled, the system automatically prints out the correct packing slip and box labels - no need for human intervention here. You can also set the system to send an automatic email to the recipient that includes their tracking number and order invoice - again, no need to manually write and respond to customers.

Reporting

Get a bird’s eye view of your distribution data without having to collate the data or generate the report by hand. This is another process that an ERP like NetSuite can successfully automate. This prevents you from having to do the heavy lifting in report generation, while getting you the insights you need as quickly as possible.

For more details on distribution automation and where NetSuite fits in, connect with us through the form below - or have a read of how we helped K9 Natural with their operations.

 

Reference:

1.https://www.bluelinkerp.com/blog/2019/12/10/4-tasks-you-should-be-automating-with-wholesale-distribution-software/