Distribution software helps manage the supply chain process by combining functions such as inventory management, forecasting, purchase orders, accounting, and customer relationship management. It automates warehouse management, inventory levels, and real-time monitoring. It can also include sales and accounting functions and CRM applications.
Distribution software is an application package integrated into computer systems that helps an organization manage the supply chain process. Some organizations use business solutions that combine the functions of two or more departments that directly impact inventory. The different functions in a distribution software application can help with inventory management, forecasting, purchase orders, accounting, and customer relationship management.
Companies that distribute and manage inventory may find that distribution software is required to track their products. Since the distribution pipeline usually requires products to be stored in warehouses and moved from one location to another, the software application is an automated way of managing inventory levels by SKU or UPC. One of the main reasons distribution software is used is the instillation of some sort of warehouse and inventory management system.
Warehouse management helps companies keep their warehouses organized. Software features identify storage locations for individual products based on UPC number, help employees locate suitable spaces for individual shipments, and pick product as needed. It can also help warehouse staff rearrange the space to make room for the addition of new products, or improve bin efficiency by placing similar products close to each other.
Monitoring real-time inventory levels of each product stored in company warehouses is another important function of distribution software. Inventory management identifies which products are running low and need to be reordered to meet demand. Forecasting product demand based on customer order history is an automated task that the software can handle once specific parameters are defined. The software is flexible enough that employees can manually adjust these parameters as needed if demand is not in line with supply levels.
Since supply chain management is largely sales-driven, enterprise systems can be used to achieve some sort of automation between the sales and operations departments. For example, a manufacturer that sells directly to retail customers might purchase distribution software that automatically transfers sales orders to the warehouse’s computer system. The system in the warehouse then deducts these inventory levels from its location and generates renewal orders from suppliers or major distribution centers. A warehouse computer system could also generate orders for pickers to locate, fulfill, and pack for pickup.
Customer relationship management (CRM) can be included in some distribution software packages. This function manages prices, ordering levels from sales and the ordering process. CRM applications may include links to external support services. These are usually services that are beyond the scope of both the warehouse and the sales staff, such as billing or technical support.
Supply chain management software might also include sales and accounting functions. Not all organizations will use it, but it can include a general ledger to record accounting transactions. Financial management functions generate and track debits and credits based on orders received from sales.
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