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A List of Common Technology Abbreviations

As with many industries, the software industry has its fair share of terminology and acronyms that can sound like gibberish to those outside of the know. To further complicate matters, many software and technology companies use these acronyms in different ways. Therefore, it is always a good idea to get extra clarification when speaking with software vendors about their solutions and the functionality available. It’s important not to make assumptions about what a given system can or cannot do based on previous conversations with other vendors and how they used specific terminology themselves. To help you better understand some of the more common acronyms, we’ve put together a cheat sheet for future reference and you can read more about each below.

Download Technology Abbreviations Cheat Sheet

ERP Software – Enterprise Resource Planning Software

ERP stands for Enterprise Resource Planning and is a business software solution designed to manage all aspects of a company’s operations including; accounting, order entry and processing, inventory, contact management, warehouse management and more. ERP software replaces the need for purchasing and integrating multiple standalone inventory, accounting and CRM systems and works best for growing businesses looking to automate processes, increase efficiencies and reduce manual work. 

API – Application Program Interface

API stands for Application Program Interface and is a set of routines, protocols and tools for building software applications. Essentially, an API dictates how software components should interact and allows two separate systems built on different operating systems to communicate and share information with one another. In the world of ERP software, an API connection is frequently used when you want your ERP system to communicate with your eCommerce store.

Example: An API allows you to pull order information from your eCommerce store into your ERP software and subsequently updates inventory information on the website and in your ERP system.

BI – Business Intelligence

Business Intelligence or BI, is the ability to extract actionable insight from the internal and external data available to an organization, to support decision making and improve corporate performance. The ability to collect, gather and organize data from within your organization can help you identify trends, patterns, threats and opportunities to make strategic business decisions. The same applies to data collected from outside of your organization. Most ERP solutions provide some functionality for BI in the form of reporting features.

BOM – Bill of Materials

A Bill of Materials (BOM) is a list of components necessary to assemble a particular item used when manufacturing goods. The BOM helps you determine what you can make from the available components. Sophisticated manufacturing processes require a BOM to track turning raw ingredients into finished goods. Simple manufacturing processes such as putting together a kit also requires a BOM to keep track of the parts of the kit.

CRM – Customer Relationship Management

Customer Relationship Management (CRM) software helps you manage and track your customer and sales lead information. These systems are more advanced than basic contact management features found in many ERP solutions and provide tools to help fully manage relationships with customers, vendors and prospects from initial contact, to close and post-sale. CRM software includes tools for scheduling upcoming actions such as follow-ups and meetings, it allows you to track and move prospects through your sales funnel and enables you to maintain information on the customer or prospect that other departments can access. You can purchase CRM software as a standalone solution, or some ERP solutions include built-in CRM functionality so that you don’t need to purchase and integrate multiple systems.

EDI – Electronic Data Interchange

Electronic Data Interchange represents a set of standards, outlining formats for information that can be electronically exchanged between two parties. Essentially, EDI allows trading partners in the supply chain to exchange documents and provides a format for translating data from one system into a format that is readable by another system. With EDI, your customer can send an order from their software solution, no matter which technology it’s built on, and then your ERP system will be able to translate the information into a readable format.

Example: Your customer (a large retail business) sends you a purchase order via EDI, which gets translated into an EDI file type known as an 850. Next, your ERP solution picks up this EDI 850 file (using one of several methods) and translates the information into a format that is readable in your ERP system. This allows the information to automatically populate into your system for processing.

FIFO – First In, First Out

FIFO which stands for First In, First Out is one of the most commonly used inventory costing methods. As the name suggests, the FIFO costing method is set up so that you sell the oldest inventory items in your warehouse first which corresponds to the actual physical flow of goods in your warehouse and helps to avoid inventory items becoming obsolete. This means that you track and account for the COGS based on the purchase price of each inventory item at the time you receive it into your warehouse.

P&L – Profit & Loss

A P&L is a type of financial statement known as a Profit and Loss statement. You may also have heard the term P&L before with a different name – Income Statement. A P&L statement covers a specific period of time, frequently a month, quarter or year and includes information on a company’s revenues and expenses for that time period. Your revenue is the income earned from the sale of product or delivery of a service and your expenses are the cost to provide that product or service. Once you subtract the expenses from your revenue, you can determine if your business made a profit or loss for that period.

PCI Compliance – Payment Card Industry Compliance

Payment Card Industry (PCI) Compliance refers to a set of standards designed to protect credit cardholder information. These standards apply to any business that stores, processes, or transmits payment cardholder data both online and offline. It includes manual processes for safely recording, storing and accessing card data and can apply to ERP software with credit card processing functionality.

RMA – Return Merchandise Authorization

Return Merchandise Authorization is the process for dealing with customer returns. Software with RMA functionality allows you to track and manage the RMA process, providing better insight into what products are being returned the most and why, and if the return process is easy and intuitive for customers. Efficient RMA processes improve customer satisfaction and retention by helping businesses pay more attention to faulty goods and repairs of merchandise. RMA software functionality needs to be paired with internal RMA processes for physically accepting and tracking returned merchandise.

RDP – Remote Desktop Protocol

RDP stands for “Remote Desktop Protocol” and is a Microsoft licensed technology available for a large range of computers, tablets and other devices. A device that has an “RDP Client” and a connection to the internet or local area network can be used to run software that physically resides on one or more servers somewhere else – and not on your computer or device.

Example: To access Blue Link’s cloud-based ERP solution, you must do so via an RDP connection. Blue Link is then responsible for maintaining the hardware and servers that the software lives on, as well as managing upgrades and backups. Therefore, using RDP, you can access the software and processing power of the servers and hardware, without having to purchase or maintain any of the equipment yourself.

RDP and the Cloud

SAAS – Software as a Service

Software as a Service describes software that is licensed on a subscription basis. Instead of purchasing software as a one-time upfront license fee, SaaS allows you to pay a monthly fee for access to software that is hosted on the software provider’s servers and not on your own equipment. SaaS is frequently used interchangeably with the term cloud-based or hosted solutions.

WMS – Warehouse Management System

WMS stands for Warehouse Management System which controls the movement and storage of inventory within a warehouse and helps to process the associated transactions, including receiving, put-away, picking, packing and shipping. WMS systems log every single movement of product in your warehouse, show available locations in the warehouse to add product based on empty space, allow you to receive and ship product before putting it away and more. True WMS software is designed for large warehouse operations with a high volume of orders and complex requirements. Many ERP systems provide some built-in WMS features that are perfect for smaller distribution operations.

 

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Benefits of ERP: Increased Automation

One of the many benefits of ERP software is increased automation; the ability to complete a task with minimal human intervention – for example, the ability to email a document, update a status, insert a field value, change a record etc. Finding opportunities for automation within your business can have huge implications on your bottom line, growth potential and customer satisfaction. And automation does not necessarily mean the need to replace employees. Instead, it reduces the amount of manual work, allows employees to focus on more meaningful tasks and eliminates the need to hire additional staff to support small growth spurts in your business (such as an increase in demand). Unlike introductory or standalone systems, ERP software provides functionality across all operational areas of your business, providing ample opportunities for automation across departments. This is why it’s also important to schedule regular reviews of your existing processes to help find new opportunities for automation in the future. Below we examine some specific benefits of ERP when it comes to automating processes at your wholesale distribution business.

Reporting

Robust reporting is one of the main benefits of ERP and automated reports can take on many different forms. One example is the ability to automatically update report information to include the most up-to-date data. Instead of having to re-key and re-generate a report every time, you can automatically update the information based on specific criteria, or as a result of refreshing the data or changing time frames. With live-linked data (such as linking data between Blue Link ERP and Excel), once you create a report based on live data from the system, anytime you want to update that data you can open the report, hit fresh or change the criteria. For example, with Blue Link’s Financial Report Writer, you can create a Profit and Loss statement in Excel using live data which easily allows you to update the information every time you open it.

Automated reporting also allows you to create reports in the system that automatically get emailed to the appropriate people based on certain criteria being met. For example, you can automatically email your warehouse manager an inventory movement exception report for products where unit sales per week are trending upwards beyond normal sales growth parameters (adjusted for seasonality if applicable). This will alert your team to investigate whether you need to re-think replenishment rules (like min / max levels, etc.) for these products.

Accounting

With accounting processes, there are many different opportunities for automation. One example is around automating accounts receivable collections which can cut down on the amount of administrative resources needed. Instead of manually tracking accounts that are overdue and notifying customers, the system will automatically generate a report with information on all overdue accounts (based on criteria that you have set) and then email these customers with their account information asking for payment. Another example is the ability to automatically update exchange rates in the system which will then update any open purchase orders.

Invoicing

There are several different ways you can automate the invoicing process. One involves automatically emailing PDF invoices to customers after the order passes an automated check routine. In this example, once an order is marked as “shipped”, before the status changes to invoiced, the system will first check to ensure that the shipping charges and tracking number fields were populated on the order. If they are, the PDF invoice gets automatically sent to the customer. If this information is missing, the status changes instead to something else (such as “Missing Fields”) alerting you to manually check the order and make the necessary changes. This replaces the need to manually check every order for the right information and instead only those where the information is incomplete.

Inventory

For wholesale distributors, there are some cases where the price of inventory will change. If this is the case, automation allows you to easily and quickly update pricing information on the fly. If prices change, Blue Link ERP allows you to export existing pricing information, quickly change it in Excel based on the new pricing received from the supplier, and then import the updated pricing information back into Blue Link automatically updating the pricing for each product in the system.

Picking, Packing and Shipping

Automating the picking, packing and shipping process can help you get orders to your customers faster. Automation features allow you to send orders from all sales channels directly to the warehouse for picking, packing and shipping if the order meets pre-determined criteria such as when the order status is “Payment Received”. In this case, the system will automatically generate the pick slip for the order for your warehouse staff to begin picking. Once the order is then fully picked and packed you can ship the order and change the status to “Shipped” which automatically sends the customer a confirmation notice.

3rd Party Applications

Automation can even be used when integrating with 3rd party applications. This eliminates the manual process of entering data into multiple solutions. For example, if you sell product on an eCommerce site like Shopify, you can integrate in real-time with a two-way connection. This allows you to automatically pull order information into your system for further processing and automatically updates inventory information both within your ERP and online, letting customers know what product is available in real-time.

As you can see, automation is a huge benefit to ERP and is one of the main differences between introductory type software and a more robust solution. By streamlining operations across multiple areas of the company, customers are always up-to-date on account information, anomalies are caught quickly and orders get shipped as soon as possible.

 

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Using Barcode Scanning to Track Lot Numbers and Expiry Dates

When mistakes are made picking, packing and shipping products, the inconvenience to your customer is not the only consequence. When it comes to industries such as pharmaceutical distribution, these mistakes can put your customer’s safety at risk and increase the risk of product theft and tampering. Although there are many regulations put forth by the DEA, FDA and DSCSA to protect customers and the general public from these types of concerns, it still requires that your pharmaceutical distribution business take the necessary steps internally to ensure a secure supply chain. One option to better manage inventory is with the use of barcode scanning.

Barcode scanning allows you to track inventory as it moves through your warehouse – from receipt, to picking and packing. In its simplest form, barcodes exist to allow your business to track product movement internally and throughout the supply chain, however, in the pharmaceutical industry important information is also tracked via barcode. Unlike widgets, pharmaceutical products include various properties such as lot number, expiry date, dosage, product family, NDC#, GTIN, strength, schedule, limit and more. Recent regulations mandate that all pharmaceutical products have a 2D datamatrix barcode containing the following four data elements on each product’s smallest unit for sale.

GTIN
Lot Number
Serial Number
Expiry Date

This information can then be “parsed” using barcode scanners depending on the specific function being performed. With Blue Link’s pharmaceutical distribution software, the parsed information updates within the software’s database so that important information about each inventory item is easily accessible.

“Blue Link’s ability to populate the lot and expiry date by scanning pharma 2D barcodes is really great news for pharmaceutical distributors. It has huge implications for improving efficiency and reducing errors when receiving pharma products.”
– Michael Benedick, Pharmaceutical Software Expert
Benefits

There are many benefits to barcode scanning in general, and even more so when managing potentially harmful product such as pharmaceutical inventory.

By implementing barcode scanning within your warehouse operations, your processes are fully auditable and pharmaceutical products are traceable. This helps deter theft and reduce loss and liability.
Blue Link’s scanning functionality prevents the need for manually keying in important information such as lot and lot expiry. This not only allows product to be received more quickly into your warehouse and inventory system, it also reduces data entry errors from having to do this manually.
Pharmaceutical barcodes are also used for saleable returns verification (a DSCSA November 2019 requirement). This functionality allows employees to scan a product’s barcode and using “VRS” immediately check/verify the associated barcode to determine if it is safe to receive back into inventory for resale. Without verification of a product, the item cannot be resold.

Want to learn more about Pharmaceutical Distribution Software and compliance with DEA, FDA and DSCSA regulations? Visit Blue Link at this year’s HDA Traceability Seminar October 21-23 at the Marriott Wardman Park,  Washington, DC.

 

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Must-Have Software Features for Foodservice Distribution

As a company that sells foodservice equipment, your business requires standard inventory management and accounting software to track sales, invoice customers, and manage inventory, purchasing and the pick, pack and ship process. These types of features are fairly standard in any ERP software – Enterprise Resource Planning software – which describes an all-in-one business management solution. However, there are also certain nuances within foodservice distribution that leads to additional software requirements. These include the need to track serialized equipment and inventory, manage service and repair work (most often for warranty items), the ability to track landed costs on imported goods, barcode scanning, backorder management and eCommerce. Therefore, basic inventory and accounting software will not provide all the features necessary. Instead, look for an industry-specific solution for foodservice distribution with the following functionality.

Serialized Inventory Management
Many big-ticket foodservice equipment items include a serial number. This makes it easy for the manufacturer to quickly identify a product for replacement purposes or as a means of finding compatible parts. Since serial numbers are unique, they also allow your customers to link their piece of equipment to their account in order to maintain a purchase history and for quality control and recall purposes. Inventory items can be traced from the customer to you the distributor and then back to the manufacturer.

Service and Repair (Warranty Coverage)

Foodservice distribution software with service and repair functionality is critical for your distribution business. Instead of finding a full-blown service and repair system, basic functionality such as the ability to track service orders, parts and labor, and the ability to automatically communicate maintenance reminders to customers will save you money and is all your business needs. It is important to have a system that maintains a history of work performed and can track inventory details associated with each customer. This way, customers can easily get status updates on equipment and it allows your business to accurately account for labor costs and the cost of parts.

Landed Cost Tracking

When it comes to importing large pieces of equipment, there can be a lot of fees associated with cross-border travel. Freight costs, import fees, duty, brokerage etc. can apply to individual pieces of equipment or be based on the weight of any given shipment (or both). It’s important to be able to accurately track these landed costs and assign them to the right inventory item. This helps to ensure your pricing is fair for both you and your customer and that you’re covering all the costs associated with getting inventory into your warehouse.

Barcode Scanning

Barcode scanning automates the receiving, picking, packing and shipping process to eliminate errors and increase efficiencies. The ability to scan barcodes while picking orders help to identify and fix any picking errors at the source and provides an extra layer of inspection to make sure the order is picked correctly. Scanning barcodes when receiving inventory allows you to quickly update inventory levels in your system instead of waiting for someone to manually update the information.

B2B Online Order Portal

An online order portal acts as a secure customer account and ordering system which provides information to your customers 24/7/365. Customers are able to login, see available inventory with customer-specific pricing, place an order for product and view account information such as existing orders, past orders etc. This provides another sales channel without the need to hire additional staff. Instead, once an order comes in online, it is pulled directly into your foodservice distribution software to be further processed.

Backorder Management

For large pieces of equipment, backorder management allows you to fulfill orders without having to stock large items in your warehouse that require a lot of space. Instead, if an item is not available, the system allows you to create a purchase order for the product from the sales order and then easily fulfil that sales order when the item arrives. This also allows you to track the status of any given inventory item – available in your warehouse, allocated to an order, on backorder, etc.

 

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Tracking Inventory with Pharmaceutical Distribution Software

The pharmaceutical distribution industry is characterized by strict regulations, sophisticated product tracking and advanced reporting to a variety of governing bodies. Regulations laid out by the Drug Supply Chain Security Act (DSCSA), FDA, DEA and other associations such as VAWD, are constantly updating in order to meet the complex demand of the industry, changing consumer habits and adhere to new scientific research while still working under the main goal of keeping consumers safe. If it sounds like a complicated supply chain, that’s because it is. To reduce the stress of trying to stay on top of this complex industry, it’s important to find a software vendor that provides the right functionality for managing pharmaceutical inventory and distribution, can help automate processes, manage financials and adhere to compliance standards. In addition to functionality and expertise for the distribution of pharmaceutical inventory items, the ideal software vendor is one that has relationships with other industry experts, is a member of pharmaceutical trade associations, has partnerships with other solutions and regularly participates in pharmaceutical industry conferences and seminars to always be up-to-date on what is happening in the market.

One of the reasons why the pharmaceutical industry is so complex, is because of the various properties associated with pharmaceutical inventory. For example, instead of simply managing a product code, description, unit of measure (UOM) and pricing, distributors are also required to track lot numbers, dosages, product families, NDC#, GTIN, strength, schedules, limits and more. Below we explore some of the important pharmaceutical inventory properties that you need to manage and how you can track them in Blue Link’s pharmaceutical distribution software.

Product Code

Just like with any product, you need to create product codes for the pharmaceutical inventory items maintained in your inventory management system. Among other things, you can use this information for looking up product details and when associating products on a purchase order, sales order or quote. Since products codes are for internal purposes only, your business can choose whichever format you want, but for pharmaceutical wholesale distributors, a good idea is to use the NDC number as your product codes.

NDC Number

A product’s NDC number (or National Drug Code) is the unique number given to a product by the FDA. This number is unique to a specific product – no matter what UOMs you’re selling the product in.

Brand, Strength and Dosage

Tracking a product’s brand, brand description, strength and dosage is all important information used in Transaction Reporting (T3). The DSCSA requires that all trading partners in the supply chain not accept pharmaceutical products unless the trading partner they receive the product from can provide specific information about the product’s history. To meet these needs, Blue Link includes transaction history (product/lot tracing/ownership information) of each specific product/lot and automatic tracking of information stored to one level back and one level forward.

UOMs

Units of measure or UOMs, are the different package sizes inventory is available in. For most wholesale distribution businesses, inventory items will be available in multiple UOMs. For example, you may sell by case, by bottle, by each or by pallet. It’s important to set-up default units of measure which are the smallest unit of measure you will be inventorying any given product. You can then easily choose a different UOM category depending on the customer and order.

Product Family

Product family is important for managing the quantities of groups of products (known as product families) that you sell to your customers. Association of a product family to a product is important for Suspicious Order Monitoring (SOM). Monitoring the quantities of specific families that are sold to an individual customer is a requirement of SOM.

Dosage for Ratio

In Blue Link, the Dosage for Ratio information is important to help manage the ratio of pharmaceutical vs. non-pharmaceutical products on a sales order. This allows distributors selling non-pharmaceutical items (such as bandages, gauze, etc.) to companies such as pharmacies, to manage the pharmaceutical vs. non-pharmaceutical sales to that customer.

Pricing and Pricing Contracts

A product’s pricing dictates how much any given customer will pay for an item. Price contracts in Blue Link allow you to set-up different levels of pricing at the customer or product level. Price contracts may be based on specific customer terms, special discounts, limited time offers or other factors. If you have multiple price contracts for one product, you can decide whether to pull pricing information based on the “Best Price” or “First Price” found in the list of potential prices for the product and customer. There is always the option to override the price if you have the right user permission levels.

UPC Code

In many instances when selling to pharmacies, distributors will also sell non-pharmaceutical products. These products will often have a UPC code or Universal Product Code attached. A UPC code is a barcode made up of 12 numeric digits that are uniquely assigned to each item for easy identification using barcode scanners. For pharmaceutical distribution businesses, the use of barcode scanning helps to improve warehouse management operations and reduces the human error associated with manually receiving, picking, packing and shipping products.

GTIN

A pharmaceutical product’s GTIN number comes from the manufacturer and contains the manufacturer’s identifier and NDC number. Each UOM for a particular inventory item will have its own GTIN number.

2D Datamatrix

Just as the UPC code for non-pharmaceutical products is used to generate a barcode for scanning purposes, pharmaceutical products are now required to have a 2D Datamatrix barcode that includes important information about the specific item. The requirements dictate that each product’s smallest unit for sale must contain a 2D Datamatrix barcode containing four elements;

GTIN
Lot Number
Serial Number
Lot Expiry Date

Pharmaceutical software like Blue Link has scanning functionality that allows the user to scan the barcode and depending on the specific function being performed, “parses” the information so it can be used. This scanning functionality prevents the need for manually keying in important information such as lot and lot expiry information, improving efficiency while reducing data entry errors. The barcode is also used in saleable returns verification (another DSCSA requirement).

Lot Number and Lot Costing

A product’s lot number comes from the manufacturer and is used to track specific lots/batches of products. The lot number is assigned to a batch of manufactured product and used throughout the supply chain to  track which customers received which product/lot and when they were received. The date these specific items were received and supplier they came from are also tracked, allowing you to monitor products from the supplier to your own warehouse and ultimately to the customer. The cost (COG) associated to the lot is dependent on the price paid at the time of receipt. In the case of a product recall, businesses can identify pharmaceutical inventory items by their lot number. The lot number of a product is also used in managing the transaction history of each product (another requirement of the DSCSA).

Warehouse Locations

Managing warehouse locations from within your pharmaceutical distribution software stores information on which warehouse you want to receive pharmaceutical inventory. Once you receive product into a specific warehouse, you can then transfer it to another location at a later date. In the pharmaceutical industry, many wholesale distributors receive all product into a “quarantine” location for quality control purposes, preventing the products from being allocated/shipped without proper QC. Once the items have been cleared, they are then sent to various other warehouse locations.

Drug Schedule and Limits

A drug’s schedule dictates how the product is classified at the Federal and State level. The DEA designates a product schedule when the product is first developed. Each schedule is based off a drugs medical value and potential for abuse – therefore, drugs which have a higher potential for abuse will have a higher schedule. The schedules range from I to V with I having the highest potential for abuse and addiction. Although the DEA has designated products as “Schedule I”, no legal pharmaceutical distributor will ever sell these products, as they are normally illegal (i.e. heroin, LSD, ecstasy). Many states set their own drug schedules, however, this schedule cannot be set lower than the Federal schedule. A pharmaceutical product’s schedule is important because a business requires different licenses for the sale and purchase of different drug schedules. This is in addition to other State specific regulations such as VAWD which is a specific certification sometimes required by a state to buy/sell scheduled drugs. Some distributors set limits on the volume of products that their customer can buy. Within Blue Link, user’s set-up a product’s schedules and limits based on customer ship-to locations. The system will then automatically prevent users from selling a quantity of products over the customer’s limit.

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Benefits of ERP: Improved Customer Satisfaction

One of my favorite posts on this blog is from 2015 – 5 Benefits – ERP Software. Even though it’s been a few years, the benefits of ERP outlined in that post still stand and include some great ideas on how to help your business succeed. In today’s post, I want to dive a little deeper into the first benefit, Improved Customer Service. After we examine how ERP can help you improve customer satisfaction, I hope you’ll have new insights to share with your team and new ideas on how to serve your customers at the highest level possible.

When you deliver a positive customer experience, you’re contributing to the growth of your company by creating happy customers. As you move forward and increase customer satisfaction, you’ll see increased customer loyalty, positive word-of-mouth referrals, and more 5-star reviews for your company – all contributing to an increase in your bottom line. With the right implementation and usage, ERP software can help your company deliver a positive customer service experience and improve customer satisfaction. For wholesale and distribution companies specifically, ERP can provide a competitive advantage by developing a deeper understanding of a customer’s business, and delivering a more tailored experience to customers.

Let’s look at some of the benefits of ERP and ERP tools that can help you improve your customer satisfaction:

Better Inventory and Order Management

On a personal level, we all know how disappointing and frustrating it can be to find out that the item we want is out of stock. When your customers are ordering inventory for their business, an unexpected out-of-stock item could mean delays or unscheduled downtime that could hurt their bottom line. ERP software can help you spare your customers from this experience by keeping stock in check with re-order levels and automated notifications and by helping to predict customer demand.

Another disappointing and frustrating customer experience is the delayed delivery of shipments. Even though delivery is the final stage in the supply chain cycle, it is sometimes the most critical. Making sure that deliveries arrive on time is crucial when it comes to customer satisfaction. By using information about the products, available inventory, and information about the customer, your ERP system can help you avoid delivery delays. You’ll also be able to better manage expectations by providing more accurate delivery estimates.

With better ordering processes and faster delivery, customer confidence and satisfaction will begin to rise, and customer churn will fall. For more information on how ERP can help you better manage inventory, download our free Top Inventory Techniques.

Access to Customer Relationship Management (CRM) Tools

In addition to accounting, inventory management, order entry, and other features, an all-in-one ERP system like Blue Link will provide contact management and CRM functionality. These tools are essential when it comes to retaining customers and increasing customer satisfaction.

Retaining customers not only fosters growth, but it also helps save money. Studies show acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one. It’s also interesting to note that increasing your customer retention rate by 5 percent increases profits by 25 percent to 95 percent.

A CRM tool will allow your sales staff to track customer interactions, store addresses, order history, and more. This information is then available to other departments, such as customer service. Usually, CRM is customizable and can store any other information you would like to keep for future reference. Having access to this information can help your employees understand the customer. By logging and monitoring the behavior of your customers, your company will have a better understanding and better insight into their needs, buying behaviors, and other essential statistics. For more information on CRM and other software tools for your sales team, check out our guide.
More Efficient and Accurate Customer Service
It’s no surprise that 84 percent of customers get frustrated when service agents can’t provide the information needed. Common obstacles to quality customer service include long wait times to retrieve necessary information, or even worse, ending the customer call and then using a follow-up call to answer your customer’s question.
When you have an ERP system in place, your staff is better prepared to provide faster, more accurate, and more impactful customer service. An ERP system takes many streams of data and makes everything accessible from one place. Your team can access important information in real-time – no outdated details being passed to clients, no searching through different systems or sources of information. In Blue Link, it takes just a few clicks to access information about shipments, inventory, order history, payments, pricing, and more.

Did you know? According to a recent study, satisfied customers tell 11 people how happy they are, while dissatisfied customers tell 15 people about their bad experiences.

For small-medium sized businesses, making customer satisfaction a priority can be a way to get a competitive edge. Research shows that 55 percent of customers are willing to pay more for a guaranteed good experience. When it comes to receiving premium services and experiences, 86 percent of consumers are willing to pay more for an upgraded experience. Offering different levels of service can help your customers feel more in control of their experience. It can also boost customer loyalty and can help you generate incremental revenue.

It’s easy to see that the benefits of ERP software are essential to the success of your SMB. If you’d like to hear more about how Blue Link can help you improve customer satisfaction, please schedule a free demo or book a free consultation today.

 

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Competing with Yourself When Evaluating Software

Analysis paralysis, inability to make a decision, over analyzing, fear of potential error…sound familiar? If so, you’re not alone. Many people suffer from analysis paralysis every day when it comes to making purchase decisions, travel plans, and simple choices in their lives. But when it comes to business decisions such as buying enterprise software, analysis paralysis can have significant negative consequences and hinder company growth. So why do we feel the need to speak to so many potential software vendors when searching for a solution? Why are we constantly involving more experts in our decision-making process? Why do we sit through presentations and meetings and waste countless hours on Google…only to make no decision at all?

It’s hard to say why we have trouble making decisions aside from the fact that it’s in our nature to avoid the pain we associate with failure and mistakes. This pain comes from the fear of making the wrong decision. No matter how much time and energy you spend during the software search, there is never any guarantee that you are making the right decision, and its detrimental to the decision-making process to assume that always performing more research, analyzing more data, and talking to more people will completely mitigate the risk of making the wrong decision. Although all these things can help you make the BEST decision, there comes a point where there is nothing to be gained from further analysis and it’s time to make a final decision – risk and all. Ultimately, the worst decision you can make for your business is no decision at all.

Deciding is the only way to move forward.

Successful business leaders know that to move forward means to make decisions, and they are confident in their ability to do so. They give direction and are willing to assume the risk and take responsibility for success or failure of any decision made.  They take calculated risks and are comfortable with uncertainty. They understand that making a decision, even if it’s the wrong one, is a step forward.

According to the article A Bad Decision is Better Than No Decision At All by Katherine Keller…“A person who makes a thousand wrong decisions is better off than a person who makes no decisions at all. Why? Because a person who has made a thousand wrong decisions has ruled out a thousand things that do not work for them. They are much better prepared to move forward towards success than the person who is in day four of watching PowerPoint presentations on Plan A vs. Plan B.” Too many options and too much analysis can actually have the reverse effect on decision-making. Instead of empowering business owners to confidently make decisions, it adds to the stress and anxiety already experienced when making a big purchasing decision. The buying process today is saturated with too much data, too many people involved in the sales process and too many options.

Don’t make decisions on price alone.  

To help with decision making, many businesses rely on comparing product pricing alone. However, price is only important if it’s not aligned with the market. If you’re finding that price is significantly different between the software vendors that you’re evaluating, perhaps you’re trying to compare solutions across different tiers – or you need to adjust your budget to fit the real-world. A solution that saves you time and money, has the right features and can scale with your business – all at a fair price – is more important than getting a solution at the lowest price.

How to Make the Best Decision: 

Implementing new enterprise software within your organization is likely one (if not the) biggest decision your company will ever make. Therefore, it’s important to dedicate time and resources to the search to ensure a decision is actually made in the end. No decision is still a decision – and frequently the worst decision your company can make. Try to remember why you started searching for a new solution in the first place and to help you avoid analysis paralysis during the search and evaluation process, consider the following:

Only evaluate a small number of software vendors.

Trying to evaluate too many software vendors can result in wasted resources, overwhelmed employees, and ultimately the wrong decision (or more likely, no decision at all).  It’s better to have more in-depth discussions with a few vendors than to skim the surface with a whole bunch. According to Columbia Business School Professor Sheena Iyengar, “Overall, choice overload reduces engagement, decision quality, and satisfaction”.

Involve the right people in the decision-making process at the right time.

It’s important to involve final decision makers as early in the sales process as possible. Once you have completed initial discussions and have a short-list of potential vendors, it’s time to involve decision makers in more in-depth discussions and demos. This prevents the situation where decision makers get brought in late and stall the decision-making process by asking questions that have already been answered. It’s also important that the people who have the authority to influence the decision are empowered to do so. To ensure buy-in from other team members and employees they need to believe in the person making the decision.

Stick to a plan.

Having a plan and then sticking to it is imperative in the decision-making process. This includes having specific timeframes for moving through the process and ultimately a final decision deadline. Break decisions into smaller steps such as compiling a list of business processes and requirements, initial conversations with vendors, in-depth evaluations and product demos. Any deviations from the plan should only happen for valid reasons – remember to focus on long-term business objectives and priorities, without getting caught-up in the day-to-day.

Focus on your objective and final outcomes.

It’s important to focus on the initial goals of your software search and not get caught up in all the bells and whistles. The right ERP software vendor will have advanced functionality that you can turn on later. Although it’s important to evaluate these types of features for future company growth, spending too much time reviewing features for future use will stall the decision-making process.

Remember, no matter how much information you gather during your search and evaluation process, there will always be more. And it’s very unlikely that you will find a solution that can meet 100% of your needs. This is where configuration and customization come into play. If you find a solution that can handle 80% of your business needs with a little configuration set-up, make sure you jump on the opportunity to help avoid the continuous loop of analysis paralysis.

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How to use the 80/20 Rule to Cut Costs in Your Warehouse

In the late 19th century, an Italian economist named Vifredo Pareto noted that approximately 80 percent of the land in Italy was owned by 20 percent of the population. The core of the idea is this: the majority of results come from a minority of causes. 80 percent of our output comes from 20 percent of our input. This observation from Pareto, published in his first work Cours d’économie politique while at the University of Lausanne, is the foundation of the Pareto Principle or the 80/20 rule – a powerful concept now widely used by leaders and businesses around the world. By maximizing the power of the 20 percent providing the greatest gains, and by reducing the 80 percent that is problematic, leaders and businesses who adopt this concept are more efficient, effective and successfully increase the profitability of their organization.

So, how can we use the Pareto Principle to help reduce costs?

When using this principle to analyze business costs, most likely you will see that 20 percent of your cost categories are adding to 80 percent of your costs. If you can determine what’s in that 20 percent, you know what to target. Your next steps are to take action on those areas.

For example, let’s say you use the 80/20 rule and identify mistakes in your warehouse as being one of your top cost areas. You see that cost and think, “Ok, I’m going to reduce costs by minimizing mistakes in the warehouse.” But, to use this principle effectively, don’t stop there. Use another Pareto analysis to examine the different types of mistakes and calculate how much each type costs. Are the mistakes related to picking the wrong product? Are the mistakes related to improper put-away processes and lost inventory? Are the mistakes related to manual processes and lack of automation? Most likely, you will again find that 80 percent of your mistakes are being caused by 20 percent of the problems, so the problems in that 20 percent are the ones to target.

The good news is that there won’t be many to tackle before you start to see progress. Using the Pareto Principle, out of 10 different types of mistakes identified in your warehouse, you’ll only need to focus on 2 types, the other 8 being all the small mistakes that only add up to 20 percent. Using this rule, it’s easy to see that there are a few underlying causes that are causing most of your problems.

How powerful is the 20 percent?

Let’s look further into these top 2 causes of mistakes in the warehouse. If you think about it, these 2 causes are not just 4 times as costly as the other 8. They are actually 16 times as costly. As they are only 20 percent, there are a quarter as many of them. Since they are worth 80 percent, they are actually 4 times as expensive in total, a factor of 16. In other words, if 2 of them cost $80 and the remaining 8 of them cost the remaining $20, then the first 2 are costing $40 each and the other eight are costing only $2.50 each. Clearly, it’s very important to focus on those 2 causes.

Where to use the Pareto Principle to cut costs

To help use the 80/20 rule for cost savings, let’s look at 3 examples where you may be able to identify problems and reduce costs in your warehouse:

Warehouse Layout. When you analyze your warehouse layout using the Pareto Principle, you might see that 20 percent of your warehouse gets utilized 80 percent of the time. Is this 20 percent optimized for the most efficient, picking, packing and shipping? Why is this area of the warehouse used more? Is it because it holds the most high-volume inventory? Is it where picking takes place? Packing? Consider options to make even more use of this space or expanding it to include more product and operational processes.
Stock. This is another easy to identify area where Pareto applies. So, 80 percent of your stock costs (your money that’s tied up in stock), probably comes from 20 percent of the items. What are those high-value items and are you selling enough volume to offset the costs? Ask yourself questions such as, can inventory management software help improve inventory turnover?
Sales. 20 percent of your customers generate 80 percent of your revenue. Are you wasting time on customers that aren’t worth it? How can you keep the 20 percent of your customers happy? What types of products are these customers purchasing and how often? Although its never a good idea to only rely on a small number of customers for continued revenue growth, this type of information can help you direct resources and determine which customers to spend the most time with.

When trying to cut costs, it’s easy to become overwhelmed by the number of areas to consider and get distracted by fixing problems that won’t yield the best results. The Pareto Principle helps put cost savings in perspective and highlights effective areas of focus. Use the insights you gain to make the greatest impact on your business and then get ready to reap the rewards.

If you’re interested in other ways of cutting costs and finding ways to save money in your warehouse, take a look at our resource Top Inventory Techniques That Will Save You Money.

 

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Updates on the Global Cannabis Industry from the MJ Biz Conference

With conferences around the world, MJBizConINT’L is where business, research, and policy intersect to advance the global cannabis industry. Each business conference welcomes global cannabis executives from mature and emerging markets to network and learn through educational sessions with discussions on conditions, market trends, future opportunities, regulatory considerations, research, science and more. This past week was the Toronto edition of the MJBiz Conference held at the Metro Toronto Convention Centre from September 4th to the 6th. The Toronto conference included keynote speaker Kim Campbell, former Prime Minister and other noteworthy speakers including Mark Zekulin, CEO of Canopy Growth Corp., Kevin Murphy, CEO of Acreage Holdings in the US, Alfredo Pascual, International Analyst at Marijuana Biz Daily, Kay Tamillow, Director of Research, Brightfield Group, Trina Fraser, Partner at Brazeau Seller Law and more. The conference included more than 40 sessions covering topics ranging from opportunities in hemp and CBD, to Cannabis 2.0 regulations, to different global market outlooks and future predictions. As an international conference, the show provides opportunities to learn more about opportunities and regulations in areas outside of North America, and provides ample examples of countries and cities that have done it right, as well as cautionary tales. With so many great sessions and speakers, there was a lot of information to take in, but I’ve compiled a list of some of the most important learning points from the show.

International Market Opportunities

Outside of North America, the Germany market is one of the biggest in terms of future opportunities in medical Cannabis sales due to it’s aging population and regulations. Germany is currently depending explicitly on imports for flower product.
There has been minimal activity on the recreational side in Europe, however, as smaller countries start to legalize, this may have a positive impact on larger, neighboring areas.
Within Latin America, there are huge opportunities with countries such as Mexico which is on track to become the 3rd largest country in the world to Federally legalize Cannabis.
The biggest issues for some international markets are not legalization, but supply chain. Many international markets have a legalization framework, but no infrastructure for supporting consumer demand.
If Asian countries such as China decide to legalize, this will have huge impacts on the market due to the population size – even if 1% of the China market purchases Cannabis product, this presents a significant revenue stream.

The US Market

The USA is by far the largest market and this is anticipated to continue to grow, especially if Cannabis becomes Federally legalized.
Overall, a lack of good data makes sales estimates tricky, but many states are starting to provide monthly updates on the number of medical Cannabis patients and recreational sales numbers which will continue to aid in future market predictions.
There are more medical Cannabis markets in the US, but they are smaller in size than recreational markets.
Recreational markets are more valuable, but also more competitive.
In the US, we have started to see more and more Eastern states legalize which is helping to grow the whole market.
Industry experts from other markets such as CPG are helping to grow the industry through consolidation and supply chain expertise.
Continued US market growth will come from both recreational and medical sales, however, this leaves the question of where certain CBD-type products fall (think beverages, skin care products, etc.)
In the US, the mass market demand is not coming from flower products but instead from edibles, vapes, oils etc.
For both medical and recreational Cannabis users, it’s less about traditional smoking methods and more about alternative ways to consume. This is a lesson for all LPs to have a plan in place for focusing on product development outside of just flower product in order to survive in the future.
For those interested in flower products, it will be for premium flower grown in top-notch facilities. Right now, there is a lack of supply of high-quality flower.

The Canadian Market

There were several issues with the original Cannabis legalization in Canada including lack of supply.
Due to the initial and on-going shortage of Cannabis products, brands have been unable to develop the full consumer experience and instead consumers are forced to buy only what is available.
This issue is amplified by strict regulations around marketing and the ultimate goal in the recreational Cannabis space is to develop the market for different types of consumer groups – for example, budget consumers vs. those who want a more premium product experience.
Canadian companies like Canopy, are leading the industry in terms of investment and intellectual property (IP). IP for products such as pre-roll machines and processes such as extraction is helping to shape the global market.

Cannabis 2.0 in Canada

Cannabis 2.0 in Canada refers to the upcoming October 2019 regulations and legalization around the extraction market, topicals and edibles.
Many industry experts believe that the long-term profitability of Cannabis product will come from either vape sales or beverage sales.
Cannabis beverages provide a social consumption opportunity with additional benefits including low calories and no hangover.
Companies can start to take advantage of this opportunity by developing IP that goes into delivering an enjoyable social experience.
Regulations around edibles and topicals leave a lot of room for interpretation – right now Health Canada has set out guidelines that make it very clear what businesses can’t do, but not what they can do. There is no closed list of the specific types of products a business is allowed to create.
One of the biggest surprises around the October 2019 date is the requirement that organizations manufacturing Cannabis products must have a separate manufacturing facility for infused products and non-infused products. This will potentially reduce the number of “ready” licensed manufacturers and begs the question of what constitutes two separate facilities?
Currently there is no requirement for the automatic transfer of testing data from labs to back-end business management seed-to-sale software, which means it is up to each company to determine what information they input manually and report on. This raises concerns around testing standards, product specs and which data sets to include from multiple labs and testing facilities.
Some Cannabis companies are trying to vertically integrate and “do-it-all” – cultivation, extraction, manufacturing etc., but this is not a sustainable business model – especially in the start-up space and instead Canadian companies should focus efforts on one area of the market and doing it well.
All edible products will have to be “shelf-stable” which makes chocolate products a risky choice.
The Quebec market is trying to impose its own extremely restrictive regulations.
In general, its hard to know what types of products will get approved by Health Canada the quickest, and although there are a lot of general rules guiding the industry (such as restrictions on adding sweeteners to extracted products) there is no clear definition as to what makes something a sweetener vs. a flavor and these types of questions will be addressed on a case-by-case basis.

Attending these types of conferences is important for keeping up-to-date and getting a head start on industry best practices and future regulations and market predictions. However, its important to note that the industry as a whole is constantly changing and there are still a lot of unknowns and contradictory information being presented. As a representative of Blue Link ERP, I attended the show to learn more about what’s happening in the industry to continue to build out our Cannabis software solution.

About Blue Link Cannabis ERP

With over 20 years’ experience as an all-in-one inventory management and accounting ERP solution, Blue Link has been helping businesses streamline and automate processes for decades. Blue Link’s robust lot tracking and reporting functionality for pharmaceutical distribution companies has helped us develop specific features and reports to aid in meeting Cannabis regulatory requirements set out by Health Canada and other regulatory bodies. In addition to Cannabis-specific functionality, Blue Link provides tools for warehouse management, CRM, financials, inventory, order entry and processing, pick, pack and ship and works with industry partners for your pre-harvest and post-harvest cultivation needs, and eCommerce requirements.

 

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What is the Internet of Things (IoT) and how does it relate to smart devices?

Would you like to understand what the Internet of Things (IoT) is and what it means for business owners? Or maybe you’re already familiar and just need a refresher. How does the internet of things relate to smart devices?

In this post, we’ll look at the definition of IoT, along with an explanation and an example of what it is. Then, we’ll move on to the differences between connected, smart and IoT devices and how they all relate to each other. To wrap things up, we’ll take a quick look at what this means for business owners.

What is IoT?

Daniel Burrus, one of the world’s leading technology forecasters and innovation experts, defines the Internet of Things as:
“…a combination of networked sensors and machines that enable machine-to-machine communications. Enabling technologies to include the Internet, advanced cloud services, wired and wireless networks, and data-gathering sensors, making the system instantaneous anywhere, anytime.”
In other words, the Internet of Things is simply an extension of the current Internet, expanding into our physical world, and more specifically, physical objects.

For example, let’s pretend you own a factory and it’s your job to oversee a building full of machines and equipment that create products or perform services. If one machine goes down, your supply chain and business will suffer. Maintenance and regular checks are key for making sure that your operation goes on seamlessly.

But it takes time and money to look at every machine individually. Even if you’re performing regular, daily checks on all your equipment, you’re working from old and possibly outdated data. Unlike manual maintenance and checks, IoT capability gives you access to real-time information on the status of your operation and can predict and alert you to potential issues. Instead of working from a day-old or week-old report, you know exactly what is happening in real-time, giving you the opportunity to stop interruptions before they start.

IoT is the process of giving a physical device or object the ability to connect to the digital world in a real way. In this example, your machines now report as devices, and these devices connect to a centralized hub. Your machines now share information like battery level, operating efficiency and even give reports on any jams or specific operating issues that you may need to know about, and would have previously missed with manual checks.

As you can imagine, this will significantly reduce the response time needed on business-critical actions. In addition, you can now schedule maintenance repairs when you know you need them. This example uses a factory, but it doesn’t stop there. Eventually, IoT will be the solution to monitoring and maintaining distributed machines everywhere from assembly lines, airports, drone deployments, buses, within your home and so on.

How are IoT devices different than connected or smart devices?

Back in 2014, Michael E. Porter and James E. Heppelmann assessed the difference between smart and connected technology in the Harvard Business Review this way:
Smart things are products that incorporate sensors, microprocessors, data storage, controls, software, an embedded operating system with enhanced user interface, and the capability of running autonomously (e.g., following a programmed schedule). Smart devices are often connected to a network of some kind, but it’s not required.

Connected things are products with sensors, microprocessors, and controls that communicate with networks in order to serve two purposes. On one hand, it exchanges data over the network to allow monitoring and data collection. On the other, it’s designed to allow some of its functions to be controlled remotely by one of those smart things over a communications network.
In other words, smart devices provide some level of automation, gather data and can be programmed for specific uses, while connected devices are limited to being remotely controlled and monitored.

For example, a connected clothes dryer can tell you when your cycle has finished. A smart clothes dryer, on the other hand, may have sensors to detect if the clothes are dry before the full cycle is complete, and can be programmed to shut off and conserve energy instead of continuing to dry already dry clothes.

IoT devices are a step up from connected and smart devices and create more value because they are more scalable, upgradeable, automated and future-ready. In the example used above, an IoT clothes dryer goes beyond sensing when the clothes are dry and can determine the most cost-effective way to dry the clothes. For example, the device can collect data such as the humidity level of the geographic area of the device, the most efficient fan speed, heater temperature, local electricity rates and so on to predict when the load will be ready and how much it will cost to dry the clothes.

What does this mean for businesses?

Eventually, all companies will have IoT solutions and systems in place. By using IoT products, businesses will have access to better business insights and consumer experiences, can further reduce costs and equipment downtime and easily identify more ways to boost efficiency and productivity. Changes will also be seen when it comes to asset tracking, eliminating waste and reducing inefficiencies.

But, we’re not quite there yet. Implementing IoT solutions is still costly and convoluted. In the meantime, business owners have access to a wide range of other information sources to help streamline operations, drive business decisions and help increase their bottom line, such as advanced real-time reporting and business intelligence (BI). Like IoT, business intelligence can help business owners improve efficiency and increase productivity.

To learn more about what BI encompasses, and how it adds value when incorporated into an ERP system, look at our whitepaper “Using Business Intelligence Tools to Drive Decision Making.”

 

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