Procurement is an important aspect of a company’s processes. Efficient procurement management ensures steady flow of items at an appropriate level that matches consumer demand. It also maintains inventory levels at minimised carrying costs. Procurement is a broad profession with numerous interconnected operations that are not easy to handle well. In this piece, we will investigate how nicely done procurement management can lead to your wholesale business success.
1. Find Inefficiencies
Inefficient procurement management is detrimental, as it slows down your company and reduces earnings. Inefficiencies cost businesses 20% to 30% of their income each year, according to IDC. To change the situation, companies must look deep down to uncover bottlenecks. You can start by having a detailed picture of your procurement process.
Only after you have detected all the limits of your management process can you think of breakthrough ways to solve them. For example, if your workflow is being stuck by tons of paper and spreadsheets, you may need to change to a more modern and efficient way – such as ERP software solution. Bringing in a procurement specialist is also a good idea as they might assist you in focusing on details and addressing minor issues before they become large ones.
2. Enhance Visibility
When it comes to the wholesale supply chain, visibility is crucial. Because of a lack of visibility, departments may be unable to obtain accurate and real-time stock updates or information about potential interruptions. When combined with a lack of supply chain forecasting, you will struggle to accurately forecast how much inventory you will require in the near future. As a result, you may be unable to place reorders on time or have enough stock to meet customer demand.
Wholesalers can examine balances in real-time using advanced procurement management software to eliminate shortages and overages. The program can also manage time-consuming and repetitive operations like manually adjusting inventory levels for thousands of SKUs. Product line distribution allows you to focus on more profitable items while reducing low-selling ones.
3. Analyse Data
Because all of your consumers buy in bulk, brands in the wholesale market must cope with big numbers of items. If you do not process this data well, this can make meeting consumer expectations difficult, especially if you lack a reliable Business Analysis tool like the one in Synergix ERP Software.
For your wholesale supply chain, data may make or break it. Accurate data can provide insights into the present performance of your supply chain, which can then be used to inform your actions. Keep track of crucial supply chain KPIs such as inventory turnover, supply chain costs, and client order cycle time by monitoring supply chain analytics.
Use this data to see where you are now, what needs improvement, and how much demand you may expect in the future. Then, turn the data you’ve gathered into meaningful insights to optimise various supply chain processes.
4. Create a Collaborative Environment
In general, it is crucial for all companies to maintain a connected means of communication between all parts. All departments must be able to communicate with one another in real-time and have access to all of the information needed. This will ensure collaborative nature among everyone on your team as well as important partners.
For example, if your shipping partner alerts you ahead of time about potential delivery delays, you can quickly notify your retail partners. This will give them enough time to implement the necessary actions.
Communication allows you to build trust, which is especially important if you are a wholesaler. There is a potential that your supply chain may be disrupted, causing your products to arrive late at your retailers. Notifying these incidents to your retailers can really help them reduce losses.
5. Train and Equip Warehouse Workers
Training your warehouse personnel improves wholesale inventory management. You can only hold your staff accountable if you provide them with adequate training to carry out their duties. Examine how they perform in person. How can training your employees help you reduce product damage? Is there a group of highly experienced persons who can help their colleagues with inventory training?
Even if your staff is performing well, they can benefit from more information and skills. It is totally up to you to decide which programs to implement and who should receive such training.
As a wholesale distributor who buys and sells products, you may have overlooked procurement management optimisation. Using an advanced Procurement Management solution as you attempt to improve your inventory management methods is a wise step. Synergix ERP System can provide you with the forecasting expertise, automation, and insights you want to take your wholesale business to the next level.
If you’re ready, start a free consultation now!