Anyone who cooks knows that the more ingredients and steps in a recipe, the more opportunities to mess something up. If you’re cooking for a large group, it gets even trickier.
If you don’t have an efficient process that helps you manage all the timers and measurements, you’re at risk of serving up some disappointing dishes. Scaling up can have a similar effect on distribution order entry.
Distributors do order entry in many ways: by phone, by email, online, in person, sometimes even by fax. Often these methods require extra steps, such as an outside sales rep calling the order into a customer service rep, who then has to enter it manually. Or extracting order details from a PDF document.
Multiply that by the number of line items in each order, which could be in the hundreds, and you’ve got a complex and time-consuming process on your hands. If you’re a large distributor with dozens of locations and thousands of employees – well, you get the idea.
Much like a home cook sweating over a fancy Thanksgiving dinner for their extended family, distributors need to recognize, anticipate and address the pitfalls of the order entry process. Doing so can improve both the customer and employee experience while also having a real impact on the bottom line.
Order entry challenges typically fall under six categories.
This is a given, but the severity of the challenge depends on the size of your catalogs. The more SKUs and product configurations you offer, the more of an impact it has on your order entry process. And the many interdependencies between products and customer-specific needs, such as pricing and freight preferences, only add to the challenge.
Many distributors, even very large and successful ones, operate on outdated systems that hinder efficiency and make it harder to scale. That includes broadly marketed ERPs that simply aren’t built to handle the high volume of large orders that national and global distributors deal with. As a result, these systems chug along slowly, doing their best to process those transactions but ultimately stemming cash flow.
Beyond latency issues, they also tend to require significant manual entry and re-keying. It’s exhausting and time-consuming, and the more of it someone has to do, the more likely they are to make errors.
As a result, some distributors have concluded that these solutions just don’t work for their industry. They just stick with the devil they know instead of making the effort to find something better —which, of course, doesn’t really solve anything.
Software latency is just one example of inefficient order entry operations. Large distributors often use multiple systems that don’t work well together, creating hiccups and bottlenecks that slow things down even more. All those different entry points, like PDFs and punchout systems, further necessitate tedious manual work and make things far too inconsistent to become a well-oiled machine.
Customer service team turnover can be high (maybe in part because the order entry process can be so frustrating). Reps may not even stick around long enough to become proficient in your systems. This creates an incentive to reduce learning curves and get people up to speed as quickly as possible. Implementing a new system – no matter how much more efficient and productive it could be in the long run – becomes an even more daunting task.
B2B buyers have come to expect the same straightforward and fast transactions they get as consumers, so when an order entry is delayed for any reason, or it contains errors, they get frustrated. If it happens consistently, they start looking elsewhere.
Also consider that any time the sales and customer service reps spend manually pushing an order through is time they can’t spend engaging customers. If they’re too overwhelmed to nurture customer relationships, it can make them seem distant and unresponsive.
The longer you wait to adopt advanced order management solutions, the more ground you’ll lose to competitors who already have. As they increase efficiency and scalability by optimizing their workflows, you’re missing opportunities to increase revenue and improve margins.
You’re also racking up labor costs with teams that exist to manage data entry, which balloon when you have to add temporary staff at peak times. Even if your sales numbers still look good on paper, you’ll be falling behind.
By addressing these challenges head on and embracing modern order entry technology, you stand to benefit in several ways, including:
Streamlined workflows and automated systems can reduce order processing time from minutes to seconds, increasing order line-level profitability across the board. And because these systems can’t get tired or bored, they’ll avoid the errors that can happen when repetitive tasks are performed manually. These benefits add up quickly.
With monotonous manual tasks largely eliminated, your staff can focus their energy and skills on higher-value work. This also improves morale, as people generally prefer to feel valuable rather than just another cog in the machine. New employees can get up to speed much faster when they don’t have to learn the complicated procedures and workarounds necessitated by manual order entry on legacy systems.
It’s hard to scale inefficient processes — they require headcount to increase in kind, and their flaws only become magnified when your company grows and takes on more business. Your company needs to adopt processes that allow them to do more with less.
Less data entry means leaner teams and lower labor costs, and fewer errors means avoiding mistakes like mis-ships and backorders that affect the bottom line.
A big part of improving the order entry process is improving your data engineering capabilities. When you do this, you can ensure that your platforms integrate with each other correctly and that you can leverage data-driven insights to optimize the entire cash-to-order lifecycle. Large distributors generate massive amounts of order data, and by centralizing and standardizing that data, you can generate insights that improve your decision-making. Plus, you’ll have better visibility across the board.
Improving order entry on the back end ultimately delivers a better customer experience on the front end. When you funnel those order-entry points into a seamless system behind the scenes, they’ll be able to continue ordering in whichever way they prefer and get a good outcome.
If those challenges sound familiar, and those benefits sound appealing, it’s time to focus on improving your company’s approach to order entry. It’s a major task for any large distributor, but at ProfitOptics, we know how to help big companies make big changes in short order. Reach out to our team today to learn more.
