Innovation Paves Way for New Distribution Challenges

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I recently came across an article in Time magazine, The 25 best inventions of 2017. The best inventions ranged from shoes engineered to boost performance, a flavor packed guilt-free ice cream that packs fewer calories, mugs that heat your coffeeInnovation Paves Way for New Distribution Challenges just right, to glasses that give sight to the blind. It seems like today’s efficient electric cars and smart home technologies were introduced into the mainstream a decade ago. At first, my thought was "why didn’t I come up with these ideas"?


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Posted by Dhanish John, Product Marketing Specialist, Epicor

Innovation Paves Way for New Distribution Challenges


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Most of these ideas came from the minds of millennials or startup companies. And it is just a matter of time when the prototype becomes an actual model and is available in stores few weeks later. Such is the pace of innovation, manufacturing, distribution, and logistics these days.

Innovation in invention has been around the block as long as mankind's evolution. It is what drives this world forward, keeping us connected to what we need and where we need it. AT&T produced a commercial in 1993, which detailed electronic toll booths, smart phones, real-time security information, and online banking among other inventions. Back then, the road to these inventions seemed far too stretched. Before we knew it, the components of that commercial were a part of our daily lives.

Startup companies have to carefully study the demand and interest in their products. Two years down the road, there might be a better version of their product or another invention that could potentially be in-demand. It might seem like the old saying, "make hay while the sun shines", comes in handy. But it draws a bigger picture when there are so many logistics involved in getting these new products into the hands of a consumer. This has, in turn, changed the global landscape of marketing, sales, and distribution. Inventory is continuously moving and customer satisfaction depends on the real-time information regarding the movement of their packages.

Distribution software allows just this type of tracking, giving you real time information and visibility into the various parameters of your choice. Technology has also resulted in better use of space in warehouses, as well as improved space, and accuracy of delivery. This leads to better warehouse management.

The evolution in eCommerce is making deep inroads into every consumer's life. The typical broadline distributor operates on a cost structure around 4% sales. That is the whole cost structure - including marketing, sales, processing, product management, logistics, and information systems. These distributors can run operations handling tens of thousands of individual products on margins that are measured in basis points. Obviously, it is a volume game, but it is impressive to see their investment in ERP systems that can both drill down into the details and present the big picture. The ability to go mobile or adopt cloud based systems has had a dramatic impact as well.

Consumer demand is at an all-time high. With fading products back in demand, and new inventions setting up broad visions of how our daily lives can be very productive, distributors need to stay at the top of their game.

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