With that information, the salesperson can try and collect on the account or stop pushing sales to that particular customer. Financial management Clearly, cash flow is the life and death of distribution, notes Skinner. With that in mind, distributors need effective and advanced accounting systems. It s important to have a system that tracks pricing, rebates, contracts, discounts, and receivables and payables, for example. Many software companies offer systems with those capabilities, specifically designed for distributors.
Skinner notes that such tools are becoming increasingly available and more affordable.
Outsourcing some of those activities is also an option, according to Kathleen Krueger, president and chief operating officer of Depot Direct in Perrysburg, Ohio. Depot Direct is a centralized warehouse and fulfillment center. Manufacturers use the service to consolidate their inventory, which is then made available to their distributors. Limited human resources is one of the major hurdles for small distributors, notes Krueger. With fewer people to get the job done, outsourcing non-core business function collections and receivables, for example allows the distributor to focus on providing service and applications assistance to the customer.