Inventory Management Software – ERP

Wholesale Distributor

Wholesale Distributor Inventory Management Software

Ximple offers ERP for Inventory Management Software to Wholesale Distributors : On-Cloud Inventory Management Software and On-Premise Inventory Management Software.

Inventory (or stock) management is the most challenging part of the wholesale distribution business. If managed well, it has the potential to increase profitability. Else it can reduce margins and profitability. It will also tie up limited working capital, thus affecting all areas of the wholesale distribution operations.

What are the wholesale distributor’s challenges for inventory management?

Wholesale distribution businesses have demanding customers. They are facing an eCommerce challenge while manufacturing is pushing sales directly to the customer and trying to eliminate wholesale distributions. In this competitive environment, the wholesale distribution business has the following inventory management challenges.

  • Overstocking : This is also known as surplus inventory or excess Inventory. This Inventory is not moving quickly through the system, thus clogging up precious space and working capital.
  • Understocking or Stockout : This is a situation when fast-moving inventory that is in demand is not available to service sales orders or customer demand.
  • No track of Inventory : Organization has no idea of inventory availability. This delays servicing of sales orders and generates customer dissatisfaction.
  • Inability to find the Inventory’s exact location : This leads to loss of time as the users search for Inventory to service orders.

What is inventory management?

Inventory management constitutes a set of processes and procedures that helps in tracking, controlling, valuing, and reporting the Inventory available in the Organization.

  • Tracking means understanding where Inventory is available at any point in time. The Inventory could be at the receiving dock, in the warehouse, in-production floor as WIP, in-dispatch location, or in-transit.
  • Controlling is about ensuring that Organization has a clarity of the Inventory available in the warehouses. It is also about providing that expired products are removed from the Inventory, and that management gets alerts and notifications before a batch of Inventory is about to expire.
  • Valuing is about reporting the Cost of Goods Sold (COGS) and the closing Inventory at the end of the accounting period.
  • Reporting is not only about the closing Inventory but also about Work in Process (WIP) inventory available on the production floor but also about the inventory in-transit until inventory reaches to customer’s location.

What is inventory management software?

Inventory management has an impact on both profitability and working capital management. Efficient inventory management leads to improvement in inventory turnover and reduction in the cost of goods sold, both of which improve profitability, and to improvement in cash flow which reduces working capital requirement.

A large number of items and a large number of transactions characterize inventory management. While this by itself is challenging, the effort required for optimal storage and tracking of on-hand Inventory adds to the complexity. An effective inventory management system will enable the handling of these challenges.

An inventory management software is a standalone software that helps organizations effectively manage their Inventory. A standalone inventory management software may help small wholesale Distributors and Retailers to address their inventory quantities effectively since their needs may be limited.

inventory management software
Future of ERP

Best ERP & Inventory Management Software for Wholesale Distributors

As the Wholesale Distributors grows, a standalone inventory management system will prove to be inadequate. The three critical reasons for the inadequacy of standalone inventory management software are:

  • Standalone inventory management software does not support inventory valuation.
  • Standalone inventory management software does not integrate with other supply chain systems and business areas, including demand planning, forecasting, procurement, warehouse management system, distribution centers, production and shipping.
  • Standalone inventory management software is not integrated with accounting software. Hence, it is not possible to generate real-time Inventory and COGS accounting entries.

The inventory management software must integrate with other business areas, including POS, Order entry system, Counters sales, Procurement Software, Warehouse Management System (WMS), Transportation and Shipping management, and Accounting software. The wholesale distributors can meet these requirements by leveraging ERP Software for Inventory Management.

What is ERP for Inventory Management Software?

ERP for Inventory Management Software is an ERP (Enterprise Resource Management) Software that integrates the Inventory Management activities with the enterprise’s broader operations. This integration ensures a single source of truth of Inventory status across the Organization. An ERP for Inventory Management integrates the following business areas with Inventory.

Purchase Requisition : The user can review the inventory availability across the Organization before raising a Purchase Requisition.

Purchase Order : A buyer can check the expected receipts before placing a purchase order for an item. Demand planning can ‘see’ the on-hand availability and scheduled receipts before placing a requirement for an inventory item.

Data Servers

The Warehouse Management system (WMS ) will ensure that the materials’ received’ by the Inventory Management system is stored in the correct location and the inventory availability reports are updated with this information. Besides, Warehouse Management ensures quick picking against consumption demand.

Integration with inventory management software ensures that quantity is kept up-to-date after each shipment of material Integration with Cost Management ensures that inventory value is updated accurately after every transaction based on the valuation method used by the organization. It provides updated costs in real-time and implements process changes promptly to eliminate costing mistakes.

An ERP for inventory management ensures that every inventory transaction is accounted for correctly and profitability information is available on a real-time basis.

How to select the best Inventory Management Software for wholesale distribution business?

  • Inventory Management software should meet the other transactions, including internal transfer, local taxation, scrap, and obsolescence.
  • Inventory management software should allow Multiple methods of quantity tracking, including Lot (Batch) tracking or Serial Number (Specific) tracking.
  • Support perpetual inventory management. Every inventory transaction must be cost and accounted for in real-time.
  • Integration with the accounting and financial system i.e., General Ledger (GL), Account payable (AP), and Account receivable (AR).
  • Flexible Inventory reporting that meets the requirement of different levels in the wholesale distribution business.
  • Different Demand planning and forecasting systems : The primary material planning methods are MRP (Material Requirements Planning), Min-max planning, and Reorder Point Planning. The ERP Inventory Management Software should support these three methods in the minimum.
  • Inventory Workflows, alerts, and notifications : The ERP for Inventory Management should support approval workflows, for example, while transacting a high-value item alerts for articles nearing shelf-life and reports slow-moving Inventory that is occupying storage space.
  • Single source of truth : The Inventory Management system should enable single item definition in part master, and same product definition is used across ERP system. It will also allow in multiple warehouses or locations where a few parameters may differ. For example, the product may have average costing in one warehouse and standard costing in another. The ERP system should be flexible to handle such complexities.
  • Inventory Management Support different costing methods : Wholesale Distributors may require multiple costing methods due to three different scenarios. One may want other costing methods at different factories. Alternatively, they may wish different costing methods for various items in the same factory (Average cost for purchasing and standard costing for finished goods, for example) or other costing methods for transactions and analysis.
  • Inventory Management software should meet wholesale distribution transaction requirement : Different wholesale Distributors have different types of inventory transactions. For example, with the advent of e-Commerce and B2C sales, Cross-docking will attain prominence. Cross-docking is when the material is directly moved to the dispatch truck from the manufacturing plant without the intermediate storage. Other typical requirements are drop-shipment (Vendor ships the material now to your customer), Consignment sales (Customer stores your material and is billed based on the final sales), Outside Processing Each of these transactions will have costing, valuation, and accounting implications. Inventory management Software ERP systems should be capable of handling these aspects.

What are the Benefits of Best ERP for Inventory Management Software?

  • Inventory Management Software Integration of Inventory with Demand Planning Management ensures adequate material availability to meet the forecasted demand
  • Inventory Management Software Integration with Accounting and Cost Management provides real-time cost valuation. It helps track profitability and takes required corrective actions to improve margins.
  • Inventory Management Software offers Automated cycle count and physical count recommendations
  • An ERP for Inventory Management Software ensures a single source of truth for item information. Without this, different applications will maintain their view of an item leading to multiple versions of the same thing in the Organization.
  • Inventory Management Software offers visibility to obsolete Inventory leads to accurate Inventory quantities and values.
  • Inventory Management Software Availability of multiple costing methods eases transaction processing and enables improved analysis.
Enterprise resource planning

Top Cloud Inventory Management Software & ERP for Inventory Management: Outlook


As with any other business process, advanced technologies like Artificial Intelligence, Machine Learning and Deep Learning will impact inventory management software as well.

Wholesale Distributors are already experimenting with smart storage with AI algorithms identifying the best storage location to store the new lot and smart picking. The algorithm identifies the optimum pick route. AI will be further used for predictive analysis of obsolescence. Besides, technologies like QR Codes will become prevalent.

A smart supply chain software will further reduce storage costs. Customer orders will be registered online, products manufactured or assembled at distribution centers. based on individual orders (customization), the production & distribution will be scheduled based on the dispatch truck availability through GPS and logistics application and the finished product will be loaded directly into the truck, thus bypassing storage altogether!

Boost your Business with Ximple ERP

Another new paradigm in wholesale distributions and retail business is that of Omnichannel customer experience. The E-Commerce system has ensured a broad and large customer base, which means that the transaction challenges in inventory management will explode. Many geographically spread out customers means many smaller distribution centers, including planning, availability, and storage challenges. Besides, enough Inventory has to be maintained in stores as well, which calls for additional carrying costs.

The characteristic of inventory management software is the fixed core transactions. Every wholesale distributor and retail business procure, stores, tracks and ships Inventory. The core processes are not going to change even in the future. However, the associated business processes that impact are improving at a rapid pace. These changes will add pressure on inventory management by shortening lead times and charging high costs on inventory shortages.

The opportunities for innovation in inventory management software are only limited by the ability of the ERP to adapt quickly to the new technologies. Ability-to-market and speed of innovation will be a key differentiating factor for ERP vendors in the times to come.

ERP for Inventory Management

Ximple ERP & Cloud Inventory Management Software for Distributors :

Ximple Offers SaaS-based Cloud ERP software to Leading Wholesale Distributors. Our inventory management software offers real-time inventory visibility, improved inventory management, eliminates stock-out, improves inventory turnovers, reduces obsolescence inventory, assures timely new product introductions, reduced manpower to manage inventory, inventory management software integrated with warehouse management system (WMS), POS & counter sales, Demand planning & forecasting, Accounting system for small and mid-size wholesale distributors, includes the ability to scale up to multi-billion $ wholesale distribution business. It severs Inventory Management needs for Electrical Wholesale Distributors, Automotive Distributors, HVAC wholesalers, Plumbing distributors, Fasteners Distributors, Industrial Distributors, Hose and Fittings Distributors, Construction Distributors, Electronics Distributors, Pharmaceuticals, Chemical Distributors, Power Transmissions & Bearing Distributors & Convenience Store Distributors.

Does your ERP Software providers meet the below criteria?

• Does your ERP Software meet your Business Needs?
• Does your ERP solution aligns with company goals?
• Will ERP Software Integrate/compatible with existing systems?
• Have partner Network/Availability?
• What type of training/support options offered by the ERP Solution provider?
• Have references and recommendations from customers?
• Does your ERP provider invest in tomorrow’s technology?


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