6 Steps to Selecting the Perfect Distribution ERP
You’ve set down all the requirements for your distribution ERP and your team of people from across your business is ready to start the ERP selection process. How can you pick the perfect program for your people and your President too?
Consult Your Industry
Take your time. You will hear from every potential provider and all of them will have a distribution ERP that “exactly meets all your needs”. Start by asking around. Check with other distributors in your area or elsewhere. What suggestions do they have? Which ERP are they using? Would they recommend that one or another? Why? If they could back up time, what would they do over? Talk to people outside of distribution too. Many ERP systems cross over to different businesses. Maybe they are a manufacturer and they are happy with their ERP. If that provider has a version for your business, they could be worth a look.
Use Reviews to Assess Vendor Services and Culture
Read the reviews. Experts have weighed in on most of the ERP systems and their opinions are valuable. Particularly read reviews in distribution industry publications. Consider utilizing consultants to see who has expertise that fits your needs. Many ERPs are sold by the business that developed the system but others are sold through consultant and VAR channels. You want the right ERP but you also need the right advice and implementation support.
Set ROI Goals and Metrics
Work within your ERP selection team to forecast monetary value you hope to achieve through your ERP. You will need that value to calculate return on your investment and predict your cash flow through the transition period. Will you track ERP ROI by supply contracts won? By the efficiency metrics of your warehousing and logistics? Or simply by revenue streams?
Quiz Your Vendor on Distribution ERP Features
Now you are ready to talk with providers and consultants. Listen patiently to their canned presentations. Then make sure they talk about benefits to distributors. Will the ERP help you manage first expiry – first out inventory flow? Can you link to your customers through EDI or web services? If you need the ability to accept internet orders, do they already have the interface? Is the ability to accept unsold returns from your customers built in and easy to use?
Create a Final Shortlist
Narrow the selection to a final shortlist. Get customer references and call them. Arrange to visit and see the ERP in action. Don’t limit your conversations to the IT people. Talk to inside sales and warehouse people too. Are they satisfied with the value? What would they have done differently? Look at the user interfaces and see if they really are friendly.
Accept That the Project Doesn't End with Selection
Calculate your expected return on your investments and make your final distribution ERP selection. But don’t take that vacation yet. Now you must start with testing and implementation. You are going to be busy for a while still.
Featured white papers
ERP Software Pricing Guide
Get your comprehensive guide to the cost of ERP softwareDownload
Calculating ERP ROI: 5 steps to success
Calculate your new ERP's financial benefits with this comprehensive guideDownload
60-Step ERP Selection Checklist
Get the comprehensive checklist for your ERP selection projectDownload
Distribution ERP and supply chain management
How ERP fits in with your supply chain management processes
Franken-system: the dangers of stringing together a bunch of apps
A guest blog from Jonar discussing a one-system solution versus multi-system operations
Considering specialty ERP requirements during selection
What industries require specialist ERP features and why they're useful during selection