F&B Industry, ERP
How ERP for Food Distribution Business has been Beneficial?
- November 4, 2021
Good food and good service are the two most important elements of the Food and Beverage Industry. If a restaurant does not have great taste in their food, customers will not visit it. Similarly, if a restaurant does not maintain a professional service, this again impacts the operations and creates repercussions on the business.
Importance of Food Distribution Business
While food and service are two different departments, it may quite possibly happen at times that food may have a direct impact on the service too. For example, if a restaurant does not have enough stock and the customers are filling up in the restaurant, the staff may either land up refusing certain orders or may delay delivering them. This surely can upset most of the customers and can have a direct impact on the restaurant business. Now for keeping a proper stock of food, the restaurants also highly depend upon different food distributors.
The food distribution business is not just something that helps restaurants. This is in fact a huge section that is behind a lot of things such as the distribution of packaged food items, and similar others. If the food distribution business houses run their operations smoothly, surely they help the restaurants and other food joints also to run their business efficiently.
One of the best ways to keep your food distribution business running smoothly is to implement the right ERP system. Here are some of the eminent benefits of implementing the right ERP for food distribution business.
Better Management of Inventory:
Inventory in any food distribution business is different from that of any other business for the very simple reason that food is perishable in nature. Moreover, food has to be handled in a huge amount, and managing everything single-handedly or manually can get confusing as well as may invite several errors. In such a case, food distribution or food inventory ERP can be of great help. The system keeps a track of the items that you have in stock and notifies you when any of the items are about to get exhausted.
Also, many of the systems have the option of notifying when an item is about to expire according to the date mentioned on the item. Thus, you can easily manage the inventory so that you can proceed towards taking the necessary actions of refilling your stocks when required and can optimize your inventory accordingly too.
Forecasting of Demand:
Apart from managing inventory properly, the ERP solutions also benefit in forecasting the demand of products in a much better way. It may always happen that your customers may demand different options from time to time. Hence, you should be ready with your stock so that you can deliver the items without any delay or any hesitation.
So, how do you know which items should be stocked in the warehouse for your customers? Well, the ERP system offers you a graph of the items that your customers have been using for the last few months. Analyzing such graph trends can help you in understanding which items are in demand in the current situation. This will help you in staying ready always with the items that your customers require.
Also, when you see the declining graph for a particular item, you can make sure to stock it less so that you do not have to them in surplus. This is again crucial because as food is perishable, having a surplus amount of anything will lead to situations such as spoilage or items getting expired as they are not in demand. This will ultimately lead to money loss. But when you analyze the forecast insights on the ERP for food distribution business, you can stay safe from such losses too.
Systematic Approach:
Often when a system is followed, everything automatically falls into place. The same thing is applicable even in the case of a food distribution business. Often elements such as stock scheduling or storage management are missed out when the stock is handled manually. But with the introduction of the ERP system, all these options also come in handy.
When you are working with a systematic approach, you are able to manage the stock well with different approaches such as FIFO or FEFO. These are options such as First-In, First-Out or First-Expire, First-Out. This way, the chances of getting any item damaged gets reduced, which saves your money from getting wasted. Also, this way, you are able to manage your stock well and are saved from the chances of storing surplus items unnecessarily.
Increase in Profit Margin:
Having an ERP for food distribution business ensures that you can have an efficient pricing strategy by offering discounts and offers on the right items that are high in demand in the current times. When you offer a competitive price to your customers, they prefer to buy more from you and you are able to pocket more profit. Also, when due to lack of systematic storage and scheduling, often you might have to face damage to food items that are perishable. Even when you are making a good profit, often such damages tend to narrow down the profit margin that you have earned.
The ERP system helps you by scheduling those items first that have either arrived before or are expiring before. Similarly, you can see updates of the stocks that are stored so that you do not order surplus. This helps a lot in saving any kind of food wastage that otherwise will lead to money wastage. Moreover, if noticed in a bigger picture, the ERP system has come up as a boon for the food distribution business.
While initially, ERP for food distribution business was introduced to have a more convenient and transparent system to reduce human errors. But later on, many other benefits of the system were also revealed such as analyzing the insights offered by the system using which you can forecast the items that are in demand and cut down the chances of wasting food items that are highly perishable in nature. Overall, the system saves time, effort, and also your hard-earned money.
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