Expanding your business to serve the global market can refer to many different things, such as: opening new physical locations, working with 3PLs in different locations, importing product from new suppliers and exporting product to new customers. Many businesses are already operating in a global capacity through eCommerce sales – both on the Business-to-Business and Business-to-Consumer side. Whatever the situation, it’s important to make sure that you have the proper systems and processes in place for managing the complexities of working with people and businesses from other geographic locations. Frequently, global expansion is part of a strategic plan to grow a business which requires an internal review of current operating procedures. Do you have the systems and resources in place to handle this growth? If not, it is time to start evaluating your options. When it comes to managing growth, a business’ first instinct will often be to hire more employees, but consider implementing more advanced distribution inventory software instead. The right solution can help you grow above and beyond hiring an additional employee and will automate many other tasks across the business. Find a system that provides functionality for managing operations across different geographic locations and has experience working with companies who import and export product. Specific functionality to look for includes:
Multi-Currency: An important aspect to operating on a global scale is the ability to handle multiple currencies. When buying from and selling to different markets, it is important to record transactions using appropriate foreign exchange and to be able to manage multiple currencies for banking and financials. The right system will allow you to set currency defaults by customer and vendor, and convert transactions from the currency in which they took place to your home currency for G/L and reporting purposes. Other important functionality is the ability to perform bank transfers between accounts with different currencies.
Landed Cost Tracking: Landed cost tracking allows you to track the landed cost factors associated with bringing product into inventory, such as shipping, handling and import/export fees. Rolling these factors into the actual cost of goods is integral is determining margins and the true cost of inventory. Proper landed cost tracking functionality will allow you to automatically compile all the costs of bringing product into inventory – from within the system – as opposed to having to manually calculate these costs in a spreadsheet and then move the data over. In addition, within the software default landed cost factors can be set based on product SKU and then calculated as a fixed amount or a percentage of the product cost, with the ability to adjust these numbers according to a specific order.
Different Tax Authorities: Even when operating domestically, there will often be multiple tax authorities that will apply when buying and selling product from different regions. A good distribution inventory solution allows you to set these up according to area so that they automatically get applied when buying and selling goods. In certain areas, where tax rates vary significantly from one area ZIP code to another, specific functionality will automatically calculate this information for you based on the location you choose, so that it gets applied properly to every order.
Multi-Lingual: If you’re opening offices in new locations it is important to consider language requirements. Will you have users at different locations accessing the software who speak a different language? If so, consider the implications this can have on your vendor of choice in terms of support, training and user interface. Some vendors may offer a full multi-lingual system and interface, while others may only provide reporting and specific information in a second language. Even if language is not an issue, keep in mind the time difference between your locations and the vendor’s hours of support and how this will affect business.
Multiple Locations: If you’re operating a business with multiple locations there are a couple of considerations to make from a software perspective. If you have inventory stored at each location, do you need to transfer and track this inventory movement? Another consideration with multiple locations is accessing the system of choice. Although you can access both cloud-based and on-premises solutions remotely, with an on-premises solution, where will the server live?
eCommerce Integration: Opening an eCommerce store provides the perfect opportunity to sell product to customers all across the world. Certain eCommerce platforms can help you manage some processes such as accepting payments and creating accounts, however, it is important that your back-end distribution inventory system also communicate with your website. Proper eCommerce integration means that data is stored in one central database – your distribution inventory system – so that information can easily be passed back and forth from your website, without the need to enter information into multiple systems.
Shipping: There are lots of considerations to make when it comes to shipping product around the world, and when buying goods from overseas. Specific functionality to look for includes: a system that allows you to track shipments while in transit, inventory tracking by individual container, and re-order point tracking that takes into consideration lead times based on supplier location.