Supply chain management is a necessary part of the distribution and manufacturing industry. Using a supply chain management software makes the entire flow smooth and flawless. This system provides you with a network of facilities and distribution options, which makes commercial equipment manufacturing and supplier business more efficient. Furthermore, an SCM system helps to maintain financial flow across the network which includes manufacturers, distributors, vendors, and customers. It is not a hidden fact that all of the production orders are caused by sales orders. To fulfil all of your sales order, an ERP system for commercial equipment manufacturers and dealers is important. To make the supply chain management successful and deliver the best to your customers, you should implement an ERP system that can link your sales order module to the production-planning module.
Every equipment manufacturer tries to translate each sales order into production orders. Implementation of a robust business management software helps you to handle all the supply chain activities. Along with monitoring the progress of individual production orders, multiple routes for delivering the product to the customers are also important. Having multiple options for the routes help in generating more sales and retaining customers. With this in mind, route analysis is important, it helps in selecting the routes as per the customer’s requirements.
Multiple routes that can help supply chain for commercial equipment
Make to order
Make to order (MTO) option is the best for commercial equipment manufacturers as well as distributors. This allows them to fulfill their customer’s specific needs, which means when a customer orders equipment with extra features. Then you will make the product as per their specific requirements. In this case, production can be started only after a confirmed customer order is received.
You can fulfill customer orders in two ways,
- The first one is, as soon as you receive a customer order, you can start manufacturing that item and it may take longer or can cost more than general products.
- The second way of fulfilling customer order is, you can purchase that item from another dealer and provide it to your customer.
When an item already exists in your stock, you can immediately deliver it to your customer. Furthermore, to maintain appropriate stock levels, you need to keep track of every item in the inventory. It helps you to deliver products to your customer at the right time.
Dropshipping is the best method of the supply chain where you do not have to keep products in your warehouse. In this method, you can transfer the customer’s orders and shipment details to another vendor or wholesaler. They will ship the item directly to the customer’s location. To put it another way, you can fulfill customer orders from the help of a third-party dealer and ship products directly to the customer.
In supply chain management, inventory management is one of the most crucial parts. Keeping your inventory up-to-date is important to fulfill your customer’s demands on time. With this in mind, The min-max inventory rule allows you to draw lines where you can set minimum inventory and maximum inventory. It helps you, whenever the stock level reaches the minimum line, then the system will trigger a reorder and automatically raise Requests for Quotations ( RFQs). Now, that RFQ will be sent to the vendor and the required number of items can be purchased.