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How Your Consumer Goods Business Can Leverage Data to Drive Profitability

How Your Consumer Goods Business Can Leverage Data to Drive Profitability

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How Your Consumer Goods Business Can Leverage Data to Drive Profitability

Jul 2, 2020

Ken Weygand
computer tablet and graphs at dawn

You can't fix what you don't know is broken.

It's as simple as that. And as consumer goods importers and distributors, fixing what's broken, correcting what's inefficient or confirming what's productive could be the difference between staying in the black and going into the red.

By directly measuring your warehouse processes and operations, you can get a more holistic understanding of your efficiencies and inefficiencies. Of where you're operating effectively and where there's room for improvement—better preparing you to make the necessary adjustments to ensure success.

An industry-specific enterprise resource planning (ERP) solution can provide you with the tools to measure improvements—streamlining operations, illuminating pain points and improving efficiencies in meaningful ways.

We've explored some critical areas in which studying the analytics from your ERP could lead to operational improvements in the warehouse:  

  • Chargebacks - It's valuable for your business's success to evaluate and analyze why you're receiving chargebacks. So often, accounting gets that information, accepts the deduction and then moves on to the next task. Operations employees need to evaluate those charges. Otherwise, they'll continue and compound. You need to take a more in-depth look at those deductions and why they're being taken. This is a simple way to make a quick improvement: implement a process that involves monitoring chargebacks. An ERP can help reduce the number of chargebacks incurred and recover erroneous charges through robust tracking and record maintenance.

  • Profitability Scorecard – This is a tool that allows you to determine how profitable your business is by dissecting the profitability of each customer, product and supplier. The information is real-time and includes both above-the-line and below-the-line costs, including freight, allowances, royalties, commissions, chargebacks and more. Then you can amend and improve those relationships based on the analytics and insights the tool provides. The integrated retailer compliance functionality allows users to track and manage chargebacks, automatic customer accruals, and EDI fees, to reclaim profits and see the actual, bottom-line profitability of each customer, product and supplier.

  • On time, in full (OTIF) – OTIF is a challenge for consumer goods importers and distributors to meet efficiently and consistently— but it is something they have to get good at to remain profitable. OTIF is a metric used by retailers to evaluate their suppliers' performance by measuring the accuracy and timeliness of their shipments. This key performance indicator is a quick and easy way for retailers to gauge each supplier's ongoing performance at a glance. As a supplier, you want to remain compliant, eliminate any fines and mitigate the risk of lost business opportunity—which is why it's so crucial for you to ensure compliance and track your shipments' timelines. Combining the power of a proper demand forecasting model with integrated EDI and warehouse management enables you to reach that balance required in just-in-time fulfillment. You're able to meet the strictest OTIF standards with a consumer goods ERP that allows for real-time decisions and visibility into every step of the shipping process.

  • Forecasting and Purchasing – Automated forecasting tools integrate historical sales data and long lead times to help you optimize purchasing decisions. By evaluating and analyzing historical data stored in the ERP, you're better able to acknowledge and progress with products and partners that help to make you profitable. A flexible, rule-based environment provides automatic alerts on inventory status and reorder levels, so you can maximize order fill rates and improve customer satisfaction.

  • Import Management – An import management tool enables you to track shipments and other data on route management for deliveries. You know where things are, when they're going to be available and if the shipment will be on time. There's real value in this kind of visibility. You have insight beyond just checking the boxes and filling out forms, and you can see the effect of the work you're doing.

Acting on analytics is not about a complete overhaul to your operations—it's about small, purposeful improvements. Little, incremental changes lead to big results.

In being intentional and thoughtful with the changes you make across your business and making those changes based on analytics and insights provided by your ERP, efficiencies and improvements are bound to occur. And in becoming more efficient, you also have the potential to become more profitable.

Ready for Aptean Distribution ERP to help you leverage analytics to improve your enterprise? Find out how, now.

Tell us about yourself and an Aptean specialist will be in touch.