The Top 5 ERP Systems for Distributors in 2022
Enterprise resource planning (ERP) systems are a popular solution for distribution companies, with nearly a fifth (18%) using an ERP. In fact, the only industry that turns to ERPs more often than distribution is manufacturing.
But even though many distributors see the inherent value of an ERP, knowing which one to choose and the features that make the tool effective can be a challenge.
Distributors have a lot on their plates. They have to track finances, sales, product movements, and inventory. Many also have to manage complicated supply chain dynamics, day in and day out. With so much on the line, using an ERP system that doesn't quite meet your business needs is a waste of money and time.
ERP Software: An Overview
ERP software consists of tools for managing business processes. With the right solution, individual processes are integrated with the rest of the company’s operations.
As a simple example, the product fulfillment and inventory systems are often interdependent. You have to know the products sitting in your warehouse before you can ship them out. Without an ERP, you’d have to switch between two different spreadsheets or standalone applications—or maybe even more—to see if you have the inventory necessary to fulfill a customer’s order. But with an ERP, you'll be able to see all of this data on a single screen.
An ERP also automates processes. For example, it can tell whether you have enough inventory to fulfill orders and when to purchase more. It can also generate reports about inventory movement, which products are doing well, which ones have to be shipped back to the manufacturer, and so on.
ERP systems for distribution are valuable because they produce income-generating insights or highlight operational procedures that have to be remedied. Using data about customers, products, staff availability, and other relevant data points, distributors both large and small can reduce costs, make customers happier, and boost revenue.
The Best ERP Systems for Distribution Companies in 2022
Selecting the best ERP for the unique needs of your distribution business can be a tedious process. It involves more than simply looking at the software's list of features or technological attributes.
Below is a list of the top 5 best ERP systems for distributors, as well as the features that helped these names earn their spots.
Acumatica makes our top 5 list because they have found a clear niche in the manufacturing and distribution space. The software licensing price is conducive for small businesses. The pricing model is transaction-based, so works well for low-volume, high-margin manufacturers and distributors. Conversely, if you have a high-volume, low-margin product, Acumatica is probably not a great fit.
4. SAP S/4HANA
4HANA is very strong in financials, inventory management, and the core ERP functionality. It really is one of the best products out there when it comes to financial flexibility, GL capabilities, product costing, and the basics. S4HANA loses momentum once you get outside that core functionality, which is why we have it lower on our list for manufacturers in need of advanced capabilities.
3. Sage X3
Sage X3 has a strong core financial system, making it a great fit for manufacturing and distribution companies. Sage X3 is a good tier two alternative to some of the bigger ERP vendors in the space. However, Sage X3 is not as scalable as some of the other products on this list – so if you are a larger organization with major growth aspirations, it may not be a great fit.
2. Microsoft Dynamics 365
Microsoft Dynamics 365 offers two distinct solutions: Business Central (built for small and mid-market companies with straightforward operations) and Finance and Operations (built for larger organizations with more complex processes). With D365, you also have the flexible user interface of Microsoft, which many users are already comfortable with. However, because D365 is a flexible product to begin with, many organizations tend to over-customize the system during an implementation. The other downside to D365 for distribution companies is that the Value-Added Reseller (VAR) community is a complete mess. There are many partners implementing D365, and Microsoft doesn’t have much control over who is actually qualified to do so.
1. Oracle NetSuite
A pioneer in the ERP space, NetSuite simplifies order, inventory, and warehouse management. It features a robust CRM, supports multiple business locations, and is compatible with various database platforms available on the market.
With NetSuite, distributors can run their companies on a single, unified platform, in turn lowering IT expenses while gaining real-time visibility into a broad range of processes across the organization. This enables distributors to:
- Lower the costs associated with inventory management
- Clearly define business processes, maximize efficiency, and provide consistency across the organization
- Enhance forecasting, performance monitoring, and sales
- Lower handling expenses and boost customer service
- Get rid of data silos to improve visibility throughout the organization's systems
Discover More Ways You Can Leverage Your ERP with GSI
Getting the most out of the number one ERP for distributors, NetSuite, requires NetSuite consulting expertise with years of experience. With GSI, you have an authorized reseller of several Enterprise applications to help you design an ERP solution that suits your needs, regardless of the size of your operation. We take a holistic look at your business challenges and partner with you to apply the best solution, regardless of the source. To learn more about how GSI can help with your upcoming ERP implementation, reach out today.