Is ERP Distribution Software The Key To Speeding Up Order Fulfillment?

ERP distribution software can help distributors speed up the fulfillment process by creating more efficient workflows from the warehouse to delivery.

ERP systems evolved from more efficient workflows, and so they’re vital to speeding up the fulfillment and shipping processes. Workflows from quote-to-order, order-to-fulfillment and invoice-to-payment all get managed more efficiently because an ERP system removes bottlenecks and manual processes.

For example, ERP can be integrated with UPS, FedEx and the U.S. Postal Service. That allows you to have weight and freight charges plus related costs calculated automatically and sent back to the ERP system, which then prints the proper shipping labels.

The return process can benefit as well. A return merchandise authorization (RMA) system can help you keep better track of which items are coming back and why. If a particular item keeps returning with the same issue, you may be able to identify a quality-control problem that you can address by making changes to your product. It also automatically credits customers’ accounts and references the original order and invoice, providing you a consistent link between all those data points.

ERP distribution software can also help facilitate the picking process. Some distributors, for example, will buy a product in bulk and then break it up and sell it in different units of measure. They might buy the carton and then sell by the pound or stock in dozens and sell individual items.

The ERP system can automatically calculate the conversion between different units of measure and assist the warehouse in picking the proper quantities. That helps make for a much more efficient picking process.

Another area in which ERP distribution software helps with picking is by organizing the pick sequence to make it more efficient. Technology can help optimize the arrangement of the warehouse, as well as the staging process. You can use it to classify inventory by what’s moving into three different groups in what’s termed “ABC inventory.” Product A moves the fastest, B is the grouping of items that are medium sellers and C is the items that move slowest.

That’s one way to organize your warehouse, with product locations based on movement; however, sometimes it’s not possible. If you have a very large item, for example, you may need to put it where you have the space, regardless of how quickly it moves.

Even if you’re doing physical inventory counting, you can apply the ABC grouping method. You can manage the inventory-counting process much more efficiently if you know what items are moving faster than others. You’re going to do a periodic counting of those products more frequently, so that’s a way to do it more efficiently.

Software can alert you to what’s an A, B or C product based on what’s selling, and you can set the criteria. Say, for example, you want to know the top 20 percent of products are moving the fastest; it can help you identify those.

Barcoding would come into play here as well to speed up the fulfillment and shipping process. A lot of efficiency can be realized by putting barcoding systems in place to help with the identification and the entry of items during the pick, pack and ship process.

A post on the PC Bennett Consulting blog highlights five areas in which ERP helps to organize operations for greater efficiency. It provides better visibility into data, makes data entry automated, improves internal communication, provides for flexible reporting and provides highly integrated data point connections.

Of course, even if you have all the best technology in place, you’re going to run into problems if warehouse employees aren’t doing their jobs well. Training is certainly a very important factor.

Regardless of how efficient and functionally rich your system is, if people don’t understand how to use it or they're not using it properly, you won’t realize the benefits of the system.

The key is to only train employees on the functions that they need to know about. If, for example, you have a pick-and-pack employee, that person only needs to know how to go through that process. There’s no point in training people on aspects of the system that they don’t need to know.

Some companies train everybody on everything when they really don’t need to and the user gets confused. They’re better off if they only train employees on the aspects that they need to focus on.

In the end, ERP distribution software can help distributors in many ways to manage workflow processes more efficiently, improve the pick-and-pack process by tracking data and improve fulfillment and returns using barcoding. However, it only works well if your employees know how to properly use the technology.