The benefits of an online ordering system or web store for distributors and wholesalers are significant, as Mike Schmidt of Industrial Distribution magazine outlines in his article Strictly for Sales. With eCommerce “you are open every minute of every day and customers can buy from you at any time”. For many, this means automated sales that can reduce strain on order entry staff and result in increased sales over time.
Due to the increasing prevalence of eCommerce, customers (both B2B and B2C) now want quick and easy ways to place orders. Your customers are no longer satisfied with out-of-date product sheets; they expect real-time pricing and inventory information when making purchases and will go elsewhere if they cannot find it with you when they want it. This means they don’t want to have to call between the hours of 9-5 to see what is available. Business owners want to be able to create orders whenever they want.
Online Distributor Considerations
It’s important to note that distributors who sell online are not necessarily competing on a marketing level when it comes to selling products. This distinction becomes apparent when comparing order portals which are usually ideal for distributors and eCommerce platforms such as Shopify. The latter will often run higher costs due to the ability to leverage the website for SEO strategies. Online order portals, on the other hand, are not intended to be searched for on search engines. Online distributor platforms are primarily for customers who want to create sales orders with their custom pricing, and they can offer a nicer user experience for salespeople.
Distributors selling to large, big box stores like Walmart or Giant Tiger will benefit from an online portal. With each customer attached to a unique pricing structure, having the ability to easily see the prices and quantities without issue is incomparable for users.
These changing dynamics have led to the following pressures for you, the wholesaler and distributor:
Customers demand diversity in ordering options, including traditional methods and online ordering systems – not to mention the desire to order from anywhere at any time. Mobile ordering does not mean ordering only through a phone. In this digital era, if an online portal can be accessed with a single sign-on login, it should be able to adapt to cell phones with internet, tablets, laptops and computers similarly to eCommerce websites.
Customers have also come to expect superior product selection including multiple delivery options. If you do your own delivery, a proper software system can help you plan out shipments based on quantities available and help maximize truckloads. Software also exists to integrate with ERP systems to automatically select a shipper based on cost given various criteria from your ERP software.
Orders need to be packed on an individual basis but before being shipped there are opportunities for cost-savings. Taking a periodic look at orders ready to be shipped can allow you to identify commonalities on where they are being shipped.
To reduce shipping costs, it is beneficial to minimize the amount of packaging on products. This has the added benefit of also being environmentally friendly – a growing concern in the business world.
Not only are you expected to deliver the right quantity to the right location but also deliver product immediately and at the right price. This means the information on the order portal needs to match the information in your backend software.
As orders roll in from the ordering portal at a blistering pace and business begins to expand exponentially, you may end up falling behind with order fulfillment. In addition, inventory discrepancies result in dissatisfied customers, creating manual work when you must notify them that you do not have the product in stock that you promised them on your website. Offering online ordering itself can increase order volume to such an extent that you may require a more sophisticated accounting and inventory software system.
Find the right software for wholesalers with our downloadable guide: Software Buying Guide
How to Address Challenges Faced by Online Distributors
The easiest way to deal with these pressures is to implement an ERP Software solution with an integrated B2B ordering platform. Implementing a web store lacking proper back-end integration with a sophisticated inventory management system is a pitfall that many small distributors stumble into, leading to inevitable failure.
Many wholesalers and distributors find themselves doing “too well” after implementing an eCommerce or B2B ordering platform solution, and as a result, feel like they are drowning. Thankfully, avoiding the problem is simple: do your research, and find an appropriate integrated solution for online ordering as well as a robust and integrated inventory & accounting solution. Finding the right partner is the most important piece of the puzzle – a team with experience offering integrated ERP and eCommerce solutions will help you ensure success.