Wholesale and Distribution ERP: A Buyer's Checklist

Wholesale and distribution businesses live and die on inventory accuracy and fulfilment speed. When stock, orders and freight sit in different systems, margins leak in ways the monthly P&L never shows. This checklist covers what a distribution ERP should do, the questions to ask vendors, and the mistakes to avoid.

Signs your current system is holding you back

• Stock on hand in the system does not match the shelf
• Staff check stock by walking the warehouse or phoning another site
• Orders from your website, EDI customers and sales reps arrive in different places
• Freight costs are not known until the carrier invoice arrives
• Reordering is based on gut feel or a spreadsheet
• Month-end takes days because landed costs and stock adjustments are done by hand

If several of these sound familiar, read eight signs your business has outgrown its accounting system.

The distribution ERP checklist

Inventory and warehouse

• Multi-location and bin-level stock, with transfers between sites
• Barcode scanning for receiving, picking, packing and stocktakes
• Serial and batch tracking, with expiry dates where relevant
• Landed cost allocation across freight, duty and other charges
• Clear rules for which warehouse features are native and which need a separate WMS

Order management

• One order pipeline for sales reps, eCommerce, EDI and phone orders
• Customer-specific pricing, contracts and rebates
• Back orders, partial shipments and drop shipping
• Credit limits and holds applied automatically

Purchasing and demand planning

• Reorder points and suggested purchase orders based on sales history
• Supplier lead times and minimum order quantities
• Forecasting for seasonal peaks. For more, read peak season fulfilment strategies.

Integrations

• EDI with major retail customers. See how to choose an EDI solution.
• eCommerce platforms, so web orders and stock levels stay in sync
• Freight and carrier systems for labels, tracking and cost
• Delivery and proof-of-delivery apps for your own fleet

Reporting

• Margin by customer, product and sales rep, after freight and rebates
• Stock turn and slow-moving stock by location
• Fill rate and on-time delivery

Questions to ask every vendor

1. Show us a web order, an EDI order and a rep order landing in the same place.
2. How are landed costs calculated and applied to stock value?
3. What warehouse functions are native, and when would we need a separate WMS?
4. How does the system suggest what to reorder, and can we adjust the logic?
5. Which integrations are standard connectors, and which are custom builds?
6. Which distributors of our size have you implemented, and can we speak to one?

Mistakes to avoid

• Migrating dirty stock data. Do a full stocktake and clean up item codes before go-live. Bad data in a new system is still bad data.
• Treating integrations as an afterthought. EDI, eCommerce and freight connections often decide the project timeline. Scope them first.
• Ignoring the warehouse team. Scanning workflows that look fine in a demo can slow down a busy floor. Test them with the people who will use them.
• Going live in peak season. Plan go-live for your quietest period.

Where to start

Pick your three most common order types and map each one from order to cash, noting every system and spreadsheet it touches. That map is the fastest way to see where an ERP will pay back, and it gives every vendor the same brief.

See ERP for wholesale and distribution for how Stratus works with distributors.