Distribution management refers to the movement of goods from suppliers or manufacturers till the product is sold. It is a carefully planned and managed process that is required by several industries. FMCG, Infrastructure, Manufacturing, Automobile, and Telecom are a few which use DMS.
Distribution Management is a subset of Supply Chain Management. Where Supply Chain refers to a process of material gathering, production, and delivery to consumers. Distribution and Supply Chain are a complex process which is susceptible to human errors.
The introduction of technology and Cloud-based management systems have revolutionized the DMS and SCM. Therefore, Cloud-based management is being adopted by small businesses to large conglomerates. Any company that does not plan to adopt or hasn't already adopted shall be greatly disadvantageous.
In a report by Statista, about 87% of businesses in 2020 reported having adopted a hybrid-cloud strategy.
Errors faced in Distribution Management
Inaccurate Stock Management- Keeping a track of large volumes of produces is not an easy task. And doing it manually makes it more tedious. With a cloud platform, stock management becomes easy to keep a track of. Additionally, inventory records shall help stakeholders make decisions easily.
Trade manipulation- Cost estimate manipulation and misrepresentation of accounts is a common practice in the industry. It does not affect the consumers and product costing. However, it benefits employees and agencies. Cloud platforms shall allow the data to be available in a transparent manner.
Report accuracy- Any business in order to be competitive needs reports. A business deal or opportunity relies on the accuracy and timeliness of reports. There is no place for errors or bias. This is where cloud-based DMS comes into play. It reduces the time taken to analyze and produce reports. Is highly accurate and can generate reports in real-time too.
Advantages of Cloud-based DMS
Cloud-based DMS makes manufacturers and distributors the biggest beneficiaries. Any cloud-based technology makes work more effective and efficient. Moreover, it allows manpower to be diverted for more strategic and creative departments. Instead of being stuck in mundane routine tasks.
Cost Efficiency- Physical sets up need new servers, new computers and if you are a global company then you for sure require a big space for new servers and certain guards to look after the security of the date, but when it comes to cloud DMS, then all the above-mentioned costs are eliminated as the monthly fee for cloud-based DMS is far less than the traditional physical methods of setting up new servers.
Rapid Development- Setting up new servers, finding new computers, and appointing labor would consume so many man-hours of the company whereas setting up a cloud DMS just requires an internet connection. Minimal IT input is required from the client's end, no software up-gradation and firewall installation are also required.
Better Accessibility- Accessibility is a major factor for any client, and the traditional methods are a bit rusty as compared to what the cloud has to offer. The files and data can be accessed by the client at any time of the day. Sharing of information and documents is much easier at both ends. Also, there is no need to always wait for IT professionals for the accessibility of the files.
File Permission and Sharing- A threat to any important file and data at physical storage sites are so volatile that there have been so many reports of theft and even illegal file-sharing has been reported. But with the cloud DMS in place, there is no threat even from the internal circle of the company as the head of a particular project may share the file accessing information with a particular client itself. The password culture associated with a file is really helpful for big companies and it gives a sense of security all the time.
Integration with third-party apps- Another feature of cloud DMS is that now you can do a lot more with files and data other than just storing it safely. Different cloud DMS offers you the feature to integrate your files with third-party apps to enjoy email support, workflow managers, and other utility software.
Better security- Cloud DMS protects the files from any kind of threats, be it from rival companies, internal threats, or natural threats. Hence the DMS on clouds has the highest securities with all the encryptions and algorithms attached to the files.
While comparing in general also the SCMs and DMS are way off better on cloud than physical traditional methods, hence the FMCG's and other sectors knew that there is a need to shift from physical ways of distribution to digital cloud-based methods, However the new normal due to COVID has made it very evident for everyone that now there is no other better option than cloud DMS, hence to conclude we can see almost every sector and big companies shifting towards the cloud DMS mode.