Supply chain

A Distributor, just like all businesses is entirely dependent on the end customer - who will mostly switch where possible rather than accept any delay to their gratification and demands. Other than the standard objective of reducing inventory costs in supply chain by creating a demand led production - risk is also best managed by creating a way to give controlled access and transparency to both sides - the ‘spend side’ which includes the whole purchase-to-pay cycle, and the ‘order’ side which includes the order-to-cash cycle. Risk is massively reduced through collaboration across departments and external companies, all of whom have accurate, relevant and timely information.

Proactive inventory management policies will make a difference in your operations. By increasing visibility to suppliers process, you gain 100% visibility to whether pos have been received acknowledged and advance shipping notices are available. This allows you to more closely align your ordering on demand.

Inventory costs can be reduced by using forecasting models to reduce forecasting errors which in turn will reduce overstock, backorders, and the need for lateral or reverse logistics. Also, sharing information with upstream customers on upcoming needs also reduces demand variability and forecast error, thus reducing the safety stock required for a given customer service level.

By opening visibility to suppliers delivery times, sales can now make accurate forecasts and cash flow can be more easily coordinated based on real delivery by suppliers. Further, PWC report that interdepartmental transparency and improvements can be achieved by:

• Training all stakeholders to get the most out of a common system
• Use a system that best captures the data consistent to the departmental needs for Operational decision making
• Reduce the number of transaction-specific portals being used
• Reduce the time wasted by overlapping capabilities and potentially redundant legacies

In a word, connectivity.

By connecting to your suppliers systems you now have access to the most up to date information available.

According to Lambert & Cooper, Successful Supply Chain Management requires a change from managing individual functions to integrating activities into key supply chain processes.

“Achieving a good customer-focused system requires processing information both accurately and in a timely manner for quick response systems that require frequent changes in response to fluctuations in customer demand. Controlling uncertainty in customer demand, manufacturing processes, and supplier performance are critical.” For Lambert & Cooper, it is all about visibility.

Visibility between "connected" trading partners increases the accuracy of information and therefore trust.

These hidden costs most often lurk in a manual processing environment, where the same invoice may be handled multiple times, even before an approval decision is made. In addition to contributing to escalating labor costs, this increases the chances of missing favorable payment terms due to lengthy processing cycles. 

Eliminating these begins with reducing document-prep, data capture.