6 Costly Software Selection Mistakes

September 10, 2015

Software Selection MistakesFor many wholesale and distribution companies, replacing internal inventory and accounting ERP software is like going to the dentist; necessary, but potentially painful. Even for those businesses who consider the software purchase as a strategic investment, it can still cause stress and anxiety among employees.  Often, you can stave off the need for replacement with preventive action such as upgrades. This is why it is important to invest in software maintenance, and to find a software vendor that will also upgrade any customization work you have done – without charging more.  However, if the system you’re using will no longer be supported, or if there has been a change in the business that renders it inadequate, you have no choice but to go to market. And when you do, it’s easy to make big mistakes. Here are the biggest ones.

  1. Requirements not defined properly (which can lead to nasty surprises).

This mistake is often the result of a rushed sales and implementation process, and poor communication with the software vendor.  It is as much your responsibility as a company to define your requirements as it is that of the vendor you work with to spend the time learning about your business, and asking the right questions.  Be wary of vendors who try to rush your company to the demo and proposal stage and especially of those who offer price incentives based on specific timeframes.  To avoid this mistake, find a vendor who spends the time getting to know you and your business in order to make sure that their software is the best fit for your needs.  Lastly, never assume that certain features will be available; always check with the vendor to make sure you’re not missing functionality critical to business operations.  Once again, this should not be an issue with a vendor that does a detailed job during the sales process.

  1. Lack of buy-in.

If the people who are going to use the system are not motivated to make it a success, you’re headed for trouble.  This includes those employees in management positions with decision making power and those who will be using the system at various levels within the company.  Resistance from employees is a natural reaction, however there are certain steps you can take as a manager to ease the transition to new software.

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Blue Link ERP – Product Spotlight Video

September 1, 2015

News Release: Blue Link speaks with TechnologyAdvice.com about Blue Link’s Inventory and Accounting ERP software.

The following summary post is from TechnologyAdvice.com, a website that provides reviews and rankings of business software, including customer relationship management tools, the best ERP software, and more.

Recently our very own Samantha Hornby, spoke with Eric Perry of TechnologyAdvice to go over a few features, best practises and what makes Blue Link ERP software unique.

Samantha described how Blue Link ERP is an all-in-one inventory management system and accounting ERP system targeted at small to medium sized businesses with approximately 5-100 people. Check out the full interview video or read below for a transcript of the conversation.

TA: Welcome Technology Advice viewers to this week’s product spotlight.  I’m joined today by Samantha Hornby, the marketing manager of Blue Link, an ERP software provider.  Samantha, describe Blue Link ERP in one sentence.

Hornby: Blue Link ERP provides inventory management and accounting ERP software for small to medium size businesses, primarily those in the wholesale and distribution industry.

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Inventory Management Techniques: Cycle Counting

August 18, 2015

cycle counting in the warehouseCycle counting often comes up in discussions surrounding proper inventory management, but what does it mean and how do you incorporate it into your business processes? In this article I’ll attempt to demystify the term and further explain how regular cycle counting is important for small and large companies, for better inventory management.

What is cycle counting?

Cycle counting is used as a tool to monitor variances in inventory.  It involves regularly counting a small subset of inventory at a specific location on a specific day, with the intent of cycling through the entire inventory over a period of time, and then repeating.   With any wholesale distribution company, there will often be some sort of variance between the inventory items you have on file vs. what you physically have in your warehouse.  This is a result of product getting misplaced, extra items being sent out with bulk orders, human error, shrinkage, etc.

Determining this variance only at the end of the year can result in greater discrepancies and therefore shock from management.  Regular cycle counts help your business keep a closer eye on this variance and make necessary process changes according to the results.  Ultimately, regular cycle counting should result in detailed procedures that yield very low variance levels and a high level of inventory accuracy.

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“I can’t afford wholesale inventory software, it costs too much”

July 14, 2015

wholesale-software-costsWith any major purchasing decision, budget is an important factor. When it comes to purchasing wholesale inventory software, sticker shock is common for those moving off of introductory systems or manual processes.  However, as with any capital expenditure, buying new software should be a decision made on more than just cost – if you want to make the right investment. The same principles apply as if you were such as seeking new warehouse space. So how come cost continues to be used as a deal breaker? Before you narrow down your software options based on cost, consider the following:

Too expensive compared to what?

Expensive is a relative term.  When it comes to software, make sure you think about what you’re comparing the cost to.  Most comparable Tier 2 systems will fall within a similar cost range, so it’s important to first identify which Tier will have functionality to meet your needs. Many companies start off with an arbitrary budget based on what they feel they should spend, and not on any real world frame of reference.  Are you comparing the cost to other systems? To hiring additional employees? To purchasing more equipment?

How much will it cost you to do nothing?

Another cost to consider is the cost of doing nothing.  Businesses who do not take this aspect into consideration are falling prey to omission bias – the tendency to judge harmful actions as worse than equally harmful inactions.  Not purchasing software can affect costs directly by resulting in a new hire or indirectly through lost productivity. When it comes to hiring employees, good software should replace the need for additional staff which will save you more than just the cost of a system in the long run.

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4 Signs it’s Time to Upgrade Your Distribution ERP Software

May 20, 2015

time-to-upgrade

As a small business owner it is inevitable that some of your time will be spent putting out fires, and dealing with issues as they arise on a daily basis.  For wholesale distribution companies this may include: time spent searching through various systems and files to find information on specific orders, doing physical inventory counts to determine actual inventory volume and calculating different price levels for customers when vendors change their costs.  Although the flexibility to do this is often seen as a benefit of being a small business, it is important to not let it get in the way of executing other projects and achieving your strategic goals. As a business owner, you should try to avoid becoming so overwhelmed dealing with everyday tasks, and putting out fires, that you’re unable to focus on the core success factors of your business.  One solution is to begin looking for a more robust distribution ERP software system in order to streamline operations, automate processes and reduce the amount of time spent manually managing your business.  Although this may be one of the most important reasons to upgrade your existing software, four more are outlined below.

  • Your current systems lack integration with one another.

Lack of integration may include all or a few of your existing systems such as: accounting, CRM, inventory management and eCommerce.  Although each of your existing software systems may work perfectly well independently of one another, as your company grows the issues that arise from lack of integration will start to become more and more obvious.  Working with multiple disparate systems means that the same data must be entered several times, which can lead to keying errors and inconsistent information.  In addition, if one system gets upgraded, this version may no longer be compatible with your other systems for managing simple tasks like importing and exporting data.

  • Your current system is no longer supported, has reached its end of life, or is a sunset program and will no longer be developed.

Just as you have a business to grow and manage, so do software vendors, which means they may discontinue development on older systems in order to focus on more modern and lucrative software initiatives.  Although this issue is unavoidable, it is important to be proactive in finding a new solution when this happens.  With no support or further development, your system is more vulnerable to security threats and will no longer receive system patches.  As with purchasing insurance, upgrading your software system is more beneficial when carried out pro-actively in order to protect your business from future issues.

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The Dangers of a Developing a Custom ERP System In-House

March 27, 2015

problems-with-homegrown-softwareIn theory, developing a custom ERP solution in-house to manage your wholesale and distribution business may sound like the perfect solution. However in practise it rarely is.  Even though the system would be designed with your specific business processes in mind, the benefits gained from a completely customized solution are often outweighed by the resources necessary to maintain such a “perfect fit” system.  It’s preferable to work with an industry specific software company, who can meet most of your software needs out of the box, and provides the option to customize as well. Working with an ERP software vendor who becomes a trusted business partner ensures you get the best of all worlds – a solution that is designed for your specific business type, maintained by a team that provides expertise is the areas of software development and management, and provides guidance and insight into industry process improvements. It’s often the smaller vendors who look to build these types of relationships, as it benefits them in the long run as well – working closely with customers means they get first-hand insight into industry specific requirements, and that enables them to continuously enhance the software to better meet the needs of their target market.  Below we take a closer look at the dangers associated with developing a custom in-house system:

First and foremost, as a wholesale distribution company, your core competency is not in creating ERP solutions, nor should it be.  One of the problems with developing a system in-house is that it eats up a lot of resources and requires a large investment into the technology and skills needed to keep the ERP application up and running.  Even if this task is assigned to an IT department, it still takes time and other resources away from the activities that contribute to the businesses core competency.

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From Receipt to Invoice: The Importance of Inventory Management Software

March 18, 2015

inventory-management-process

The way in which a wholesale/distribution business manages its inventory has a direct and critical impact on its overall success and long term viability. Although this may seem rather obvious, the number of businesses who remain tied to outdated means for inventory management suggest that it’s a more foreign notion than one would imagine. Successful business owners understand that inventory represents their livelihood and its importance should never be underestimated or undervalued. Traditional methods for managing inventory, such as pen/paper or spreadsheets, can still be viable options for smaller start-up businesses, or businesses who hold very small amounts of inventory. However, as those businesses begin to grow and expand their offerings, the redundancies and manual processes involved can become too cumbersome to manage efficiently.

For many growing businesses, the next logical step is implementing an ERP system that encompasses the appropriate inventory management tools to support that growth. By implementing an inventory management system into your business you are adding a new dimension: the ability to track inventory throughout the entire distribution chain, from receipt to invoice.

Receiving Inventory – Inventory management software allows users to scan products at the receiving dock using verification scanners to immediately identify and record the product on arrival. This will record what items were received followed by what bin and shelf number the product was allocated to. Once a product is scanned at the warehouse, the quantity received gets recorded in the back end accounting system for comparison against a given purchase order, thus ensuring accuracy and identifying any discrepancies immediately.

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