Going Green. Modeling your customers’ customer. Getting your cash

Over the last few weeks we have noticed some trends and reported that a number of companies are pro-actively seeking ways to help their customers save money and connect.
Our focus is normally on hard good products, but recently we have seen software companies that are helping distributors and manufacturers to connect both up and down stream in their market place.
Most Distributors are interested in connecting to their customers as early in their buy cycle as possible. Thus the popularity of Trade Service’s Supplier Exchange in auto quoting back to their customers with fairly high match rates. The Internet and software become a “early heads up” for distributors.

From a manufacturer’s point of view, when Square D announced that they had selected Datalliance for Vendor Managed Inventory (VMI) over their internal system, it signaled that sometimes purchased software isn’t always the best answer to solve a business need. There are ongoing maintenance cost as well as software upgrades to any system. Outscourcing to specialized third party can be the answer for some companies. But not having the right product or too much inventory on the shelves are not economical and can add cost to the supply chain and diminish profits for all. What Datalliance brings to the table is an unbiased third party perspective that distributors want and many manufacturers are comfortable with.

So, when we saw a joint announcement by Norfolk Southern Corporation and Infor (a software company that serves both manufacturers and distributors), we had to take a second look. To read the announcement in Logistics Today.

Infor’s SCM Network Design software allows a public company like Norfolk Southern Corporation to model their customers supply chain needs (which include where to make , buy, store and move product) to move product through the supply chain network by the optimal mode of transportation. To read Infor’s announcement click here.

So what is in it for distributor and the manufacturer?
In 2007 and 2009 ARA conducted a survey/interview with business executives to determine software usage once purchased and installed. The 50,000 ft. overview said that most companies only use about 40% of the available functions that manufacturer and distributors purchase. Business pressure limits the amount of time and money they spend on training and implementation.
But the business needs still remain to connect with customers with quotes and electronic invoices, collect and manage SPA’s and inventory through out the supply chain.
How is your business connecting and driving cost out of the Channel?