John Kolakowski
Director, Product Marketing
Wholesale distribution is a fast and dynamic business. Constantly fluctuating inventory, complicated supplier relationships, complex logistics, and slim profit margins put organizational agility and efficiency under the spotlight. What practical steps can companies take to improve these areas?
In recent years, distributors in the construction and lumber and building materials (LBM) industries have begun modernizing their processes, moving away from clunky paperwork and Excel spreadsheets to purpose-built software solutions.
Modern software platforms like Epicor ERP bring functions like inventory management, accounting, and customer relations into a unified workflow. Instead of jumping between disparate systems or digging up the right logbook from the filing cabinet, you log onto your ERP, and everything is organized in one place.
Let’s explore how ERP solutions can transform your wholesale distribution business:
ERP software integrates critical functions into a unified digital platform—including inventory and warehouse management, supply chain/logistics monitoring, customer relationship management (CRM), accounting, reporting dashboards, and more.
For LBM and building supply wholesalers, this means consolidating data on products, customers, and suppliers across the enterprise onto a single portal.
ERP centralizes visibility and control to optimize stock levels, pricing strategies, order processing, invoicing, delivery route planning, forecasting, and vendor communication. You gain actionable, real-time insights by tracking every functional area of your distribution business via automated workflows.
Hardware integrations digitize manual processes like scanning warehouse bins and tracking fleet locations. Executive dashboards centralize operational stats for swift and informed strategic decisions.
These features come together to support your business, its operations, and growth in three key ways:
Efficient inventory management is a top priority for wholesale distributors, especially when handling extensive inventories across multiple locations.
Accurate inventory forecasting, in particular, has become essential for building a resilient distribution business, and the mismanagement cost is high. According to a study in the International Journal of Engineering & Technology, because materials account for about 55%-60% of the total construction cost, “efficient material planning is the key to successful construction projects.”
Managing inventory with an effective ERP solution is a practical means of avoiding unexpected stock-outs and improving lead time and delivery accuracy.
To help you see the big picture, ERP software supports inventory management with real-time tracking and analytics tools.
In one study, 44% of ERP users ranked improved lead time and inventory level accuracy as top benefits. Another study showed that inventory management was one of the primary drivers of return on investment from ERP systems.
ERP can help you track your inventory with significant detail:
Statistics from Epicor demonstrate how ERP-enabled inventory management can increase inventory accuracy by 95%+, particularly when combined with license plate and cart tracking, real-time receiving, work order processing, and credit processing, all of which Epicor ERP supports.
Cutting-edge ERP also works with inventory technology tracking devices, such as RFID (radio-frequency identification), mobile devices, and scanning guns, which give pickers and stockers instant access to product and storage information.
Integrating technologies like RFID within ERP systems helps provide real-time tracking of products through the supply chain. This improves the accuracy and efficiency of order fulfillment processes, enhancing operational efficiency and boosting customer satisfaction.
Material and project prices are climbing, with 1 in 3 construction projects now exceeding their budget. With expenses spiraling upwards, cost management has become a greater challenge—only 39% of building organizations are confident in controlling their overheads.
Robust ERP systems offer a powerful solution to combat price volatility and supply chain disruptions, providing real-time data and analytics for informed decision-making.
Modern ERP systems enable real-time analysis of market trends and material costs, allowing you to adjust prices dynamically to reflect current market conditions.
Collecting your transaction and accounting data under one interface allows you to inspect top customers, the products they buy, and when.
Here’s how it works:
Jason Delgado, Executive Vice President at Dartmouth Building Supply, an Epicor customer, explains how these capabilities come together to tangibly impact profit: “We have achieved a minimum of 10% per year growth in terms of both expanding our customer base and increasing order size. Epicor BisTrack helped enable that growth and has liberated resources to invest in new equipment.”
Long lead times and price pressures are tempering customer loyalty. Delayed or canceled materials orders leave companies scrambling, unable to complete contracted jobs on schedule.
Each impacted project chips away at decades-long customer trust. And in an increasingly competitive market, disappointed builders and contractors now have more options to consider.
Talking to LBM Journal, Charlie Parks from Parks Lumber & Building Supply highlighted how these challenges also present an opportunity to digitally-enabled businesses. “We as suppliers have an opportunity to lend a hand and go the extra mile to ease the process. We can do what everyone else has been telling them cannot be done.”
Nothing retains customers like meeting expectations when adversity strikes, which is where ERP plays an important role.
Modern ERPs connect sales, marketing, and accounting functions to customer data.
By understanding customers in the context of their purchases and interactions, you can design more effective marketing and customer engagement strategies.
While not explicitly designed as a marketing tool, some 26% of businesses use ERPs for marketing functions, and 41% aim to integrate customer data with the platform.
Here’s how Epicor ERP solutions can bolster your customer relationships:
Epicor ERP is designed with businesses and their customers in mind. According to Joel Russell, VP and COO of Millard Lumber, “We've picked up margin and efficiency using the Epicor BisTrack solution, but the quality of the service we can give our customers has also been greatly enhanced.”
Epicor software is a powerful means of enhancing wholesale distribution businesses. It consolidates essential functions like inventory, accounting, and CRM into one system, improving efficiency and decision-making across the company and its networks.
For wholesale distributors, this means better stock control, pricing strategies that bring in more revenue, and customer relation insights that delight and retain buyers. To experience the full force of these benefits, you need an ERP solution designed specifically for wholesale distribution companies like yours. Contact us for a demo today.
