Wholesale distributors nowadays operate in a complex market. To succeed, they need to meet their customers’ constantly changing and demanding needs. Distributors will need to optimize their existing processes and offer customized services to meet their customers’ needs. In addition to providing employees with real-time, experience-management-based insight that will support in improving efficiency in their day-to-day operations. With processes running efficiently, distributors will be able to extend their business with new products and services and become more responsive.
Strategic Priorities to Industry Leaders For Wholesale Distribution Businesses
In the new economy, most wholesale distributors’ revenue stems from customer-specific solutions that transform their business and differentiate them from competitors in the market.
New business models are essential to deliver additional sources of revenue for distributors and strengthen customer loyalty. As a result, it will help distributors secure their place in the supply chain and position themselves as market leaders.
Following, we will discuss strategic priorities for wholesale distribution companies to transform their business.
Value-Added Services Provider
Customers nowadays expect more than a standard catalogue of products; it is no longer enough. Customers have diversified sources to buy the same products with competitive pricing and delivery options. To stand out, distributors need to provide something more, for example, services that online competitors can’t offer.
Wholesale distributors must understand their service-market fit, fine-tune their current processes for higher efficiency, and tailor their current value-added services. For instance, they might save safety stock for key customers.
Above all, they will need to offer value-added services like light manufacturing and kitting, financing, risk audits, ad hoc virtual training, automated tracking of sensors for maintenance, provisioning of third-party logistics services, in addition to offering data on future demand patterns based on previous material consumption. These services will offer their clients a more appealing customer experience and drive long-term profitability.
Offering customized services and products resulted in a 10%-20% increase in customer satisfaction.
Improve Delivery Process
On top of improving customer service, distributors need to leverage technology in improving their delivery operations. That is to say; they should become an “anything, anywhere, anytime” distributor.
Customers now demand shorter delivery times, with the ability to have products delivered directly to any address. To stay competitive and retain customer loyalty, wholesale distributors
must become more responsive along the supply chain, from procurement to delivery.
Customers also expect a complete catalogue, unconstrained deliveries and limitless visibility, among other features. This requires the distributor to leverage intelligent technologies backed by robotic process automation and machine learning for things like customer price optimization or chatbot-supported order management.
Most importantly, distributors must invest in intelligent inventory solutions for predictive inventory stocking, predicting slow stock movements and analyzing redeployment of inventory.
Investing in intelligent inventory systems can reduce total logistics costs by 10% – 12%
Offering End to End Customer Solutions
To compete in the future economy, wholesale distributors need to work proactively with business partners to develop collaborative business relationships. The collaboration should cover customers’ projects and product life cycles to secure critical materials, resources, etc…
Distributors need to manage turnkey projects to successful completion. Moreover, they need to handle required bill-of-materials items, including potential third-party service providers, based on a fixed bid. This can also cover manufacturing integration, subcontracting, subscription billing, or post-project maintenance handling.
To transform into solution providers and engage with their customers to collaborate on comprehensive outcomes, distributors must move from selling products to providing services and adding value. The implementation of intelligent technologies will offer new monetization models based on subscription or usage.
To transform into solution providers and engage with their customers to collaborate on comprehensive outcomes, distributors must move from selling products to providing services and adding value. The implementation of intelligent technologies will offer new monetization models based on subscription or usage.
Collaborating with customers on projects can decrease outstanding sales days by 27%
Optimizing Business Operations
To remain competitive wholesale distribution companies must introduce intelligent technologies into their business. They need to optimize their existing processes by providing their teams with easy access to real-time insights. By leveraging these data and insights, they will be able to eliminate repetitive tasks and reassign employees to higher-value tasks. Consequently, wholesale distribution companies can be transformed by monitoring business operations to guarantee constant progress.
To optimize their operations and achieve digital transformation, companies must constantly test new processes and services. Secondly, they must test the process as they go and most importantly optimize processes for value.
Optimizing processes and automating operations will:
- Increase process transparency and visualization
- Reduce manual interventions in process execution
- Improve process compliance with audit standards
Key Wholesale Distribution Industry Numbers
- 83% of innovative organizations that rated themselves highly across the board for innovation have started a digital transformation.
- 93% of cloud decision-makers believe it’s important that the software for their business processes integrates across an end-to-end value chain in an industry cloud.
- 80% of wholesale distributors say that they are concerned about the impact on costs and profitability with the increase of business-to-consumer orders.
- 81% of wholesale distribution customers believe simplification is important for their organization, and 88% admit IT investment is important to achieve simplification.
Framework for Intelligent Enterprise in Wholesale Distribution Industry
Intelligent enterprises run agile, integrated business processes through leveraging AI, IoT and ML. They consider customer, partner, and employee sentiment and understand and work on sustainability.
Intelligent wholesale distributors can offer customized products and services and deliver unique customer experiences. Moreover, they control every source and category of spending. Most importantly, they make informed solid decisions and drive continuous innovation.
Altivate can help you develop an intelligent framework for your whole distribution business with the help of SAP cutting edge solutions. We can start by building a solid business intelligence base with SAP Business Intelligence and SAP Data Intelligence.
We can also help your business drive innovation with RISE with SAP as the best RISE Partner in the MENA region. RISE with SAP is a cloud ERP solution that can help you:
- Grow revenue by creating distinguished business models in your wholesale distribution industry.
- Sharpen process performance based on actual system usage, best practices, and industry benchmarking.
- Accelerate your progress with tailored insight into automating business processes with AI.
In addition to much more benefits that you can explore with our team. Altivate helps wholesale distribution businesses become intelligent enterprises by fueling them with customizable intelligent SAP business applications.
