Distributor Management System: 2021 Guide for FMCG Companies

Know solution to the challenges you face and streamline your dealer/distributor landscape, for secondary sales visibility.

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Distributor Management System

Managing Inventory, Scheduling visits, Accounting for Claims, Reaching out to Suppliers and Managing supplies… There are many factors that FMCG & Consumer good companies have to take care of when it comes to distributor management. Further, the emerging markets are versatile and extensive, accumulated by thousands of distributors dealing with millions of retailers, having billions of potential transactions. Today, FMCG companies need to continuously monitor a distribution network of such vast magnitude, while always juggling between different channel partners for supervision.

FMCG & Consumer Good companies require complete visibility of secondary sales execution, with precise data about inventory and utilization of schemes and offers to prepare their go to market strategy. But how do manufacturers work promotions while cutting on costs? And, most importantly, what is the solution to such large scale management?

The answer is simple; all the top companies around the globe are using Distributor Management System

 

What is Distributor Management System?

In technical terms, DMS (Distributor Management System) is a well-defined secondary sales management solution that helps optimize and organize product distribution through distributors. FMCG distribution management system is a powerful tool that helps companies to efficiently draw the roadmap to business processes comprising Inventory, Logistics, Purchase & Sales Order Management, Supply Management, and different Analytical tools required to execute distribution operations. 

 

Role of Distributor Management System in Supply Chain Management

Distributor management plays a significant role in capturing the market, especially for FMCG & Consumer Good companies. The distributor management system helps in digitizing and automating the sales process that involve inventory management, secondary sales execution, assessment of the utilization of schemes and offers, and purchase and return management for a streamlined secondary sales operations for a company.

The primary role of a DMS is to help you outperform your competitors! 

Let’s understand it with an example: One of the global firms that go by the name ‘H’, produces products A, B, and C for its brand. The factory has some ‘N’ number of warehouses where it stores its products in quantity. 

Now, it has a vast supply chain of hundreds and millions of distributors & consumers that demand the products manufactured by ‘H.’  For an individual manufacturer; it might sound like a mammoth task to overlook the aspects of proper storage, inventories, safe delivery, and several other functions! 

This is where the FMCG Distributor Management System comes into action. In a nutshell, DMS comprises all the processes involved in delivering the product to the customers/retailers, once it is out from the Manufacturing plant. 

 

Advantages of Distributor Management System over the Traditional Systems

 

  • Complete Visibility on Secondary Sales Execution: FMCG companies earlier had to wait for the collection of data about secondary sales execution from the distributor. With DMS, companies can have a complete visibility of the secondary sales execution in real time.
  • Better Inventory Management: With information about sales and stock provided to you in real-time, efficient inventory management becomes seamlessly easy. Further, it aids you in making  better business decisions with regards to demand and supply of the products in the market.
  • Increased Efficiency with Reduced Costs of Operations: Distributors can now avoid investment in workstations and human resource. Furthermore, it reduces the revenue loss to company by cutting off the extra costs on pilferage & damage.
  • Time management: When you have all your business processes working in a streamlined manner, the saved time can be utilized to strategize, plan, and innovate new ways to retain/better your position in the market.

Now that we know the benefits involved in the process, let’s look at the different challenges faced by companies while they adapt to a Distributor Management System. 

 

Challenges Faced while Adopting a DMS

When you decide on a Distributor Management System for your secondary sales operations, the biggest challenge a brands faces is that the distributors are reluctant to adopt the DMS software given by the brand resulting in incomplete visibility of the secondary sales data

Reasons? Distributors today believe in dealing with multiple brands and several products of the same category under their forte. But when a distributors uses a DMS software from one brand, they can not be using a different software for every other brand they’re distributing for, as he would require a separate resource every time he does so. Therefore, they choose to use a single management/accounting system for all the brands they deal with, be it DMS from a major brand or any other accounting software. On the part of FMCG company it becomes difficult to receive and compile the data from distributors. Furthermore, if there is no cloud integration, there are high chances that the distributor needs to wait till the end of month to send the collected data.

Using a cloud integrated single management system makes it easier for the distributors as they can continue using Tally or other software for entering data while the data of the specific brand is integrated into their system. Moreover, it aids the FMCG company with complete visibility of secondary sales and  aids inventory management avoiding overstocking or understocking.

The other challenging factor for integrating DMS is that most distributors prefer individual system for data entry. They have used Tally or any other similar system for recording secondary sales execution for years. Therefore, most distributors are reluctant to use any other software as DMS.

 

Solution to the Challenges while Adapting a DMS

Controlling such a vast line of operations can be challenging. A compelling solution among others is to use BeatRoute’s Hybrid Distributor Management System. Here’s why: 

Visibility of actual secondary sales execution is fundamental to knowing exactly what the status of sales execution is, and it also provides input to various strategies such as store level investments, team performance and also effectiveness of trade schemes. BeatRoute provides multiple ways to have visibility of distributor’s inventory to support creation of right trade schemes to avoid over stocking or understocking of any product at the distributor end.

BeatRoute Distributor Management System

Advantages of BeatRoute as your DMS

The use of BeatRoute has not one but many advantages to help you excel in your business’s supply chain management. Check them out: 

  • Web-based operations, with provision to execute operations over mobile as well: Manufacturers can now perform their operations over both mobile devices & the desktop, adding to the flexibility of their operations. 
  • Integration with the existing system: If there are adoption issues for distributors, BeatRoute has made it easier for the distributor by integrating the DMS with their existing data entry system. For instance, distributors can continue using Tally for recording secondary sales, while BeatRoute’s Tally Plugin can help the FMCG/Consumer Good brand to pick up secondary sales data without the need for distributor using their DMS software 
  • Seamlessly integrated SFA for dedicated sales management: BeatRoute integrates SFA with DMS  that works as a centralized system to provide real-time information around sales execution. 
  • Easy self-activation for distributors at every scale: Distributors don’t need to wait for technical support or guidance of any form to adapt to the platform, BeatRoute comes self-activated. 
  • Reliable link of communication: The software helps facilitate digital communication amongst the managers, retailers, field sales reps, distributors, and distributors, etc. in real-time. 
  • Automated scheme management and claim processing: With automated business processing, managing different schemes and processing claims becomes easy for manufacturers. 


To sum it all up, distributor management system is a powerful tool that can empower FMCG & Consumer Goods companies to get better control over their secondary sales execution. However, it can be a daunting task for a company to convince distributors to adopt it’s DMS, but a Hybrid-DMS Platform like BeatRoute’s serves as an ideal solution to deal with the challenge of adoption once and for all supply chain management for your company. Furthermore, it integrates seamlessly with the SFA component for true sales transformation for an FMCG/Consumer Goods Company .
 

 

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Author

Amit Vishwakarma

Being part of BeatRoute, I strive to innovate how FMCG & Consumer Goods Companies go about their daily Field Sales Operations with BeatRoute's Goal-Driven Sales Force Automation Software. Write back to amit@beatroute.io.