3 ways for wholesalers to effectively manage global supply chains
Linking manufacturers and retailers, wholesalers are critical to the success of any supply chain – and, like other businesses in the supply chain, their resilience has been tested in recent years. The pandemic, Suez Canal crisis, and soaring inflation have all added to the pressures facing wholesale distributors, making it more difficult to meet customer expectations and protect margins.
Apart from the odd drop, notably during Covid, retail sales have climbed steadily over the past couple of decades, which is good news for wholesalers. The UK wholesale market was valued at £28.9bn in 2021 and is forecast to grow by 2.6% between 2020-2026.
Whether in the consumer or B2B market, wholesalers must manage increasingly complex operations. As well as the supply chain disruption mentioned previously, firms must also ensure compliance with the new import requirements that have followed Brexit.
As a wholesaler, unless you have full visibility and control of your operations, you simply won’t be able to respond quickly enough to new challenges and opportunities, including scaling up to meet demand.
Particularly in the faced-paced FMCG and retail world, you need to ensure products hit the shelves as fast as possible to meet customer, and consumer, expectations – however, it’s worth remembering that customers in other sectors, such as manufacturing or electricals, also demand rapid turnaround and consistent product availability.
Lack of visibility is normally the result of using multiple unintegrated and legacy systems, which is why robust processes and good-quality distribution software is so important in managing a global supply chain. Here are three areas the technology can help you grow your business.
Improve stock management
One of the biggest challenges wholesalers face is unpredictable demand. Consumer purchase behaviour is changing all the time, and some wholesalers use unreliable estimates and previous sales history to predict what will be in demand later in the year. This can lead to overstocking and increased costs with money spent on purchasing, storing and maintaining goods that are not shifting.
Effective stock management is key to managing even unpredictable demand. A good warehouse management system will accurately and automatically calculate what stock is needed and when. It takes historical data, promotions, the season, and supplier lead times into account ensuring customer demand is met and less cash is tied up in stock that’s not budging from the warehouse floor.
Increase visibility and efficiency with real-time data
Embracing new technology can be a big step – but in a competitive sector, real-time data can give you unrivalled insights and help you gain an edge over other businesses. Warehouse and distribution software provides workers with real-time product information so they can complete tasks as efficiently as possible without error. Hand-held terminals, for instance, allow workers access to key information such as stock location which reduces picking times and costs.
As the world moves online, wholesalers are updating their business models in order to succeed in the multi-channel world. If you work with retailers and ecommerce businesses, your distribution software should integrate seamlessly with your customers’ systems to manage every order effectively.
Rising costs are continuing to put pressure on margins – particularly in the current inflationary environment. Labour shortages, a lack of warehouse space, and high energy costs are all prompting wholesalers to think about how automation could cut waste and increase productivity, and keep down costs for customers. Automation can replace some of the most routine work, like rekeying tasks into the system, freeing up your staff and reducing error. Within the system, you can send automated communications to customers, ensuring they receive the information they need at the right time.
Automation can deliver significant time and cost savings. Some of our own customers can typically expect 70% lower labour costs and a 233% increase in pick rates, while errors have been halved. Working as efficiently as this gives you the confidence that you can protect your margins as you grow your customer base.
Find out more about OrderWise’s warehouse distribution software.