Wholesale distributors sit in a precarious location when it comes to supply chain risk management. They “fill the gap” between manufacturers and retail/service customers by providing access to a wide assortment of products, industry knowledge and value-added services. In this role, wholesale distributors face many of the same supply chain risk management challenges as manufacturers and retailers, including:
- Product availability and time-definite delivery — having the right products when and where the customer needs them, and at the right price
- Reliably supplying a broad and deep product line of complementary items, alternatives, assortments, variations and lots, nearly always consolidated from multiple, potentially competing suppliers
- Consolidation and one-stop shopping
- Delivery and installation
- Managing substitutions for comparable or better fit, form, function, or lower price
- Managing succession where technology, regulation, competition, or fashion drive rapid product life cycles
Faced with growing costs, shrinking margins, new competitors and demanding customers, wholesale distributors must turn to advanced supply chain risk management capabilities to separate themselves from the pack including:
Advanced modeling capabilities to create a valid, forward-looking demand plan by product, customer, channel and geography, with more accurate forecasts throughout the product life cycle.
Inventory optimization capabilities to examine stock positions in each stocking location and to model interrelationships between stocking locations to reduce overall inventory levels while meeting customer service requirements.
Enhanced long-range planning capabilities to enable more accurate predictions of market changes, identify and mitigate potential risks, and empower a more predictable and repeatable integrated planning process.
This eBook, Building a Profitable Wholesale Distribution Supply Chain, presents several demand-driven supply chain planning techniques to help wholesale distributors get control of costly overstocks, stockouts and expediting charges and compete from a more profitable position.