We work with a number of customers involved in the business of distribution. Regardless of the goods being distributed, there are multiple commonalities: margins tend to the skinny, volume is important, and efficiency is another word for profitability. Any mistakes in distribution generally mean one thing: you’re not making money on the deal.
Especially in New Zealand, where we are a nation of small businesses, there tends to be a ton of competition in distribution (there are a few big ones…and plenty of small ones). Regardless of the size of your distribution business, however, there is good news in the cloud. That’s because cloud hosted software as a service puts the best of the best at your disposal.
Software to control your entire business (end-to-end, as we technology folk like to say) can now be had for a few hundred dollars a month. This, in itself, is a major advantage for distribution: after all, your capital should be tied up in facilities, inventory and personnel, not allocated to chunky software purchases.
But there’s plenty more to it (we’ll note right now, that ‘time value of money’ and the preservation of capital aside, software-as-a-service, or SaaS, has a long-term ROI very similar to that of software purchased and run the old way, that is, in an on-premise configuration. The real advantages of SaaS lie elsewhere).
I’d like to invite you to download a whitepaper from Oracle NetSuite which exposes five key trends in distribution, and then explains how cloud computing addresses them. Here’s the biggest hint around those trends – it is about being online (who isn’t these days), it is about competitors themselves using technology effectively to drive efficiency, it is about changing business models (you may have heard the alarming new acronym B2B2C, for example. Distributors usually operate business-to-business, supporting resellers…technology can enable ‘direct’ sales, where appropriate, thus delivering a margin advantage. But as you’ll appreciate, this raises the potential spectre of dealing with end-user customer queries and issues).
It is also about technology, as you might imagine. NetSuite is Oracle’s cloud enterprise resource planning software and it is ideal for use by, you guessed it, distributors. Using the technology means you can get unprecedented visibility into operations as well as efficiency and accuracy which ensures every deal is a profitable one. Including the ability to know up-front just how profitable.
And finally, the whitepaper is also about people. After all, whatever business you are in, you are in the people business. Equip your people with great tools to use at work and their productivity, so essential to company performance, is likely to see a boost, too.
Check out the NetSuite whitepaper ‘The Cloud Addresses Key Trends in Distribution’ (registration required). And feel free to give us a call or drop an email any time, we’d love to hear from you.