ERP Integration Benefits Data-Savvy eCommerce for Distribution Industry

As more distribution companies turn to big data, they are relying more heavily on ERP integration to optimize their strategies.
erp integration for data-driven distribution businesses
Shutterstock Photo License - Iurii Motov

Few people anticipated that big data would have such a profound impact on the e-commerce sector. Companies in the distribution industry are particularly dependent on data, due to the complicated logistics issues they encounter.

There are many reasons that data analytics and data mining are vital aspects of modern e-commerce strategies. These benefits include the following:

  • You can use data analytics to better understand the preferences of your users and provide personalized product recommendations.
  • Predictive analytics tools use market data to forecast trends and ensure e-commerce companies sell products that will be in demand.
  • Data analytics tools can be integrated with advertising platforms to help e-commerce companies optimize their marketing strategies.
  • Analytics tools can help e-commerce companies get better insights on the products customers are actually buying, so they can keep updating their store listings.

The distribution sector is taking advantage of changes in big data to get the most out of their digital commerce strategies. One of the biggest strategies that they are implementing stems from the use of ERP integration.

ERP Integration is the Newest Trend in E-Commerce for Data-Driven Distribution Businesses

Doxee has a great article on some of the profound benefits of big data in retail distribution.

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“Big data, in fact, can also come from other components of the business, which are equally strategic for making it sustainable or even competitive. Think, for example, of the warehouse: it is an enormous source of Big Data, whose efficient management is an essential condition to improve its performance and the customer experience. Through the Internet Of Things, in fact, it is possible to monitor the entry and exit of goods and combine it with the sales trends of certain periods (digitelematica.it). In this way, the business can better control its stock and prepare the supply chain so that they can cope with peaks in demand without leaving empty shelves at less opportune times.

Until the past several years, the eCommerce boom was concentrated almost entirely in the retail market. While eCommerce giants like Amazon transformed the B2C retail landscape, traditional channels continued to dominate in the B2B sector. However, as evidenced by a recent McKinsey report, the past several years have turned that upside down with an explosive growth in B2B eCommerce. The report shows that 65% of B2B companies now offer digital commerce solutions, which is a 53% increase from 2021.

As eCommerce tools become more sophisticated, demand has grown quickly for frictionless B2B experiences. Distributors who want to capture these opportunities should know that an integrated distribution ERP solution is a key piece of the puzzle for any wholesale eCommerce strategy.

Curious about the benefits of ERP integration for the future of B2B eCommerce? Do you want to know how to incorporate it into your data-driven business?

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These are five potential upsides that businesses can look for from a distribution ERP suite.

1. Integrated ERP provides the inventory visibility necessary for eCommerce.

Excellent inventory visibility is a prerequisite for any business that wants to stake its claim in eCommerce. Companies that maintain detailed data on their offerings will have an easier time utilizing it. They can store data on their products and integrate it through ERP.

B2B customers need immediate access to accurate data about product availability and pricing, and integrated ERP systems offer the ideal tools to give it to them. Simultaneously, warehouse and sales teams need real time access to inventory data to base their decisions on.

Because an integrated ERP system automatically pulls back end data from inventory, sales and other departments, it can display accurate inventory information that helps prevent stockouts and backorders. Data flows both ways in real time, creating an always-on information ecosystem that eliminates the common frustration of having to enter order information multiple times throughout a system.

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2. Integrated ERP allows businesses to use eCommerce and traditional B2B sales channels side-by-side.

Many wholesalers continue using traditional B2B sales channels even as they implement their eCommerce offerings. They have detailed data on the products they carry as well, which makes it easier for them to maintain fluid supply chain strategies. An integrated ERP suite helps make sure that a business is equipped for true omnichannel performance. Sales teams and eCommerce departments get access to the same data, allowing each to understand what the other is doing and how they may need to adjust their own operations.

Helping sales and support staff focus their energy more efficiently is another key part of the picture. High touch accounts and first time buyers can get the personal attention they need, while buyers who just want speed and simplicity will appreciate how eCommerce lets them skip the phone calls and emails. An integrated ERP system is a critical tool for creating a system that works for all kinds of accounts.

3. Integrated ERP helps distributors streamline their customer service.

Long-term relationships with customers are the foundation of B2B success, which means that customer service and relationship management are every bit as important in B2B eCommerce as in B2C. Most ERP systems now include a customer relationship management (CRM) module that simplifies core functions like price quotes, sales pipeline tracking and support tickets.

That functionality becomes even more important in light of research that found response time to be a make-or-break aspect of service for B2B customers. With an integrated ERP system that gives distributors streamlined CRM tools and real-time data access, customer service and sales staff are empowered to problem solve more effectively and build great customer relationships.

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4. Integrated ERP makes eCommerce easier to manage for a business’s staff.

Managing wholesale eCommerce orders can require a lot of extra time and effort from staff. ERP software helps by automating many of the key processes involved. Customers can file recurring POs, payments can be collected and shipments can be tracked—all automatically, without the need for laborious manual approvals and allocations.

Integration with popular eCommerce platforms is another key aspect of contemporary wholesale ERP solutions. Today’s ERP software suites now include APIs that allow them to integrate with eCommerce solutions like Shopify or Amazon, creating a headache-free process for automatically syncing data across the front and back end of multiple platforms.

5. Integrated ERP allows small distributors to compete with larger ones.

Small distributors need to be even more data-savvy, because they have to operate with less capital. Therefore, they need state-of-the-art tools to stay in the game against their larger and more established competitors. Virtually all large businesses use ERP software to manage their data and streamline core business processes. While the cost of on-premises ERP software once made ERP for small businesses to costly or difficult to implement, more recent cloud-based systems have created a wide variety of tools suited to all levels of the market.

With the ERP market increasingly shifting to a cloud-based structure, numerous new options have appeared for affordable cloud-based ERP billed on a monthly subscription model. Often, these solutions include small business versions of the top products in the ERP industry. That means small distributors have options for an ERP solution that will grow alongside them and is always ready for upscaling when an opportunity needs to be seized.

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6. Integrated ERP folds RMAs and return logistics smoothly into the system.

Returns are among the toughest issues for eCommerce businesses, and they can be particularly challenging for the wholesale industry. Fortunately, most distribution ERP software suites now include sophisticated return management functions that allow them to provide a smooth return experience for their customers without deploying excessive resources.

ERP software is ideally suited to sorting out the often-tangled logistics of returns. From filing RMAs to crediting accounts to ensuring stock ends up returned to the right facilities, the unified design of an ERP suite offers big advantages in coordinating the returns process. ERP functions like batch tracking are also helpful for ensuring that defective products are removed from stock after their return.

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As wholesale distribution businesses confront the new world of eCommerce, they’re increasingly recognizing that integrated ERP software is a foundational tool for success. For distributors who haven’t yet begun to investigate the world of eCommerce ERP integration, browsing some ERP comparison guides can be an easy place to start.

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Olha Zhydik
Olha Zhydik is a Content Marketing Manager at ELEKS, a global custom software development company. Olha has been working in the IT industry for over 10 years, including 6 years in marketing. Thanks to her diverse experience, her writing offers a fresh perspective on how technology can help businesses not only innovatively solve problems but also gain a competitive edge. You can connect with Olha on Linkedin or Facebook.