Regardless of the business size, wholesalers constantly encounter dynamic competition in their respective industries. Changing customer preferences, the emergence of new market trends, and inconsistency in supply chains disrupt business operations. To top it off, financial discrepancies and lack of data visibility make economic management extremely troublesome for wholesale businesses. Even when you have a skilled finance and accounting team, relying on obsolete and manual techniques will open room for errors and mistakes. And sometimes, these can disrupt your business, cause immense monetary losses, and several other problems.
That’s why it’s time to integrate ERP software with your wholesale business for streamlined financial management. It not only offers a centralized visualization dashboard but also features advanced reporting tools. Combined, these will help your finance teams manage the cash flows, maintain an economic balance, and control the finances better. That being said, we have further illustrated the role of ERP software in the financial management of wholesale businesses.
Better asset management
The lifecycle of any physical asset involves several financial aspects, like maintenance, procurement, repair, replacement, and many more. If these are not tracked properly, it can become problematic for you to determine the cash flows. Over time, you may not have a clear foresight or prevent any unforeseen events requiring a sudden lump sum investment. That’s why your finance team can leverage the ERP wholesale software to track the life cycles of all the physical assets involved with your business. It will help them to monitor the expenses involved in different activities concerning the assets, like procurement, maintenance, and repair. Additionally, you can forecast the expenses based on your machinery fleet and prevent any sudden expenses.
Integrated financial reporting and analytics
One of the key benefits of integrating the finances with the ERP software is improved data visibility. Most tools available in the market come with advanced reporting and analytical modules. Your finance team can pull data from other departments, like inventory purchases, sales, order values, and others to prepare consolidated reports. It will further help you track the cash flows, gain more visibility into the profits and losses, and forecast upcoming expenses. Thanks to the centralized reporting tool, you will be able to eliminate data silos related to your business finances and economy.
Variance analysis and management
The market is constantly shifting and so are the prices and the demands. Using an advanced ERP system, businesses can leverage the powerful variance analysis module to know more about the differences between the actual economy and their forecasted reports. For instance, your finance team can pull in the finance reports from the last cycle to match the data with the current market trends and find the disparity. It will further help in accurate budget preparation and elimination of any unexpected loss. Similarly, when coupled with a BI software, you can know more about the trends in a product cost, raw material price, and so on.
Improved budgeting and fund allocation
You cannot collaborate or manage the budgeting tasks using simple Excel sheets. It will introduce lots of errors in data evaluation, calculations, and even forecasting. That’s why integrating an ERP wholesale software with your core business infrastructure is an ideal solution. It will help you use a centralized dashboard to collaborate with all teams and draw proper budgets for a quarter or a year. Your finance team will be able to work closely with others to understand the areas that require more fund allocation and accordingly modify the initial budget plans. This will reduce the errors greatly and help you manage your finances better.
Enhanced inventory cost management
One of the major causes of financial loss for wholesalers is improper inventory management. Without having a proper view of your stocks, fulfilling all the customer orders may become difficult. Besides, if your forecasted customer demand isn’t accurate, you may end up overstocking your inventory. All these factors can lead to huge financial losses. So, you should use ERP software to manage your inventory, predict the stock volumes needed depending on the demand cycles, and streamline the supply chain. It will further help you prevent overstocking and waste. Also, with real-time inventory views, you can fulfill more customer orders, thereby balancing your cash flows.
Simplified tax compliance
An ERP software will automatically record the tax payments and other finances for audit purposes. You can also track the tax processes in real time using this tool. As a result, your wholesale business will remain compliant with all the tax regulations and standards. As a result, you can avoid monetary losses as a result of compensations or penalties for being non-compliant with the taxation rules. Besides, the tool will also help you calculate the required taxes accurately, ensuring no extra payments or paying hidden fees.
Robust automation for process efficiency
Lastly, you can benefit a lot by automating different business workflows so that manual efforts can be minimized greatly. For instance, integrating ERP software with a popular platform like Salesforce can help you convert more quotes to sales, thereby increasing the cash inflow to your business. Similarly, connecting the ERP tool with CRM will help you manage your customers properly, enhancing experience and communication.
Conclusion
Now that we have explained how ERP software can help you manage your business finances as a wholesaler, it’s time to invest in one. You can either opt for off-the-shelf software or choose to develop it with custom modules. The latter is the best solution since the tool will be aligned with your business goals and the existing workflows.