Using ERP in the Food and Beverage Industry

No industry was left untouched by the COVID-19 pandemic. The impact on the food and beverage industry however was two-fold – we saw the complete shutdown of pubs, restaurants and food outlets but an upsurge in demand for packaged food and beverages.

As a consequence, many food and beverage wholesalers and distributors look to their ERP/business management software systems to take stock of their current situation and look for ways to adapt, pivot and even grow.

But as new challenges unfold every day, businesses continue to look to their business systems for ways to sure-up their supply ecosystem in the wake of growing disorder and deal with changing customer behaviours.

In this blog, we’ll briefly cover what ERP software is and the benefits food and beverage wholesalers/distributors can expect from implementing this technology. We’ll also outline some key must-have features and highlight the factors that need to be considered when looking for the perfect-fit ERP software.

What Benefits Can Businesses in the Food and Beverage Industry Expect from ERP?

ERP helps automate and integrate your company’s core business elements to increase efficiency and simplify operations. It also consolidates real-time data from different departments to provide a 360-degree view of your company; empowering you to control all your processes from a single, centralized hub.

And, of course, ERP software aids compliance, ensures product traceability and enables you to maximise productivity and profitability.

Below we outline just some of the benefits ERP can bring to the food and beverage sector.

• One source of truth – A single-source system allows you to unify all your business data into one integrated system, in real-time. It improves communication company-wide and can encompass everything from your back-office operations to POS, telesales, ecommerce, mobile access, contactless deliveries and more, giving you a complete picture of your business.
• Flexible and customisable – With the advancement of technology, ERP systems can be highly personalised to each employee. Screens, menu options, access levels and KPI dashboards can all be easily tailored to their role. And the best thing is, your IT team or system administrator can create these and amend them without having to revert back to your software vendor. You can equip your staff with the information and controls they need to efficiently and effectively do their job whilst ensuring continuous improvement and compliance.
• Boost productivity through automation – With ERP software, you can transform tedious, time-consuming tasks into efficient automated workflows at company, role or user level. You can save countless man-hours whilst maintaining margins and enforcing business rules.
• Complete business control – Triggered intelligence such as alerts, highlight, assign, warn etc. at user, group or company level keeps employees focused on what needs immediate action and enforces real-time, data-driven decision-making.
• Easily extend and scale – Modern ERP solutions are robust, flexible and configurable enabling you to quickly adapt to present needs or grow through additional branches, diversifying, getting online etc.
• Integrate with ease– For any niche, 3^rd-party platforms that you need, many modern ERP software vendors provide REST APIs to enable quick and seamless integration.
• Enable traceability and control over inventory – From effective stock management to full batch traceability of manufacture, best before and expiry dates, modern ERP systems ensure vital control over inventory and product traceability.
• Different deployment options – Today there are many more options available for implementing ERP. From full cloud to on-premises, CAPEX to SaaS models. Know what you want and ensure your vendor can provide.

Which ERP Software Solutions Are Best Suited to Food and Drink Wholesaler or Distributor?

With so many ERP/business management solutions available today, how do you decide which ERP or business management software system best suits your food and beverage business?

Research. It’s all about doing your research. Search on the web, ask peers, seek help from any associations you are party to and get a demo. Build up your knowledge so that you can make the right decision for your business that will see you through the next 10-15 years.

If you’re an SME, you may find a business management solution like Intact Xline will fulfil your needs, without going to a full-blown ERP system. Medium to large businesses however tend to have more intricate business processes and often require integration with specialised 3^rd-party applications. In this case, an enterprise-wide ERP system is essential.

Some very large businesses may require a full wholesale management system but if your system of choice has REST API, then it can be easily integrated with your back-office system or ERP system.

If you’re in the manufacturing end of the food and beverage industry, you will require an MRP (Manufacturing Resource Planning) system. Some ERP systems, like Intact iQ, can handle a small amount of the manufacturing process through works orders but primarily tackle the wholesale/distribution arm of the food and beverage sector.

To help you figure out the best solution for your business, we’ve highlighted a few modules and features that should be a prerequisite to getting a solution that will help you operate at your best.

Must-have modules

• Proactive Telesales– You need a telesales module that enables you to proactively manage your customers by whatever criteria you choose e.g., route, day etc. And you need to be able to configure and design it so you can split calls, view order history, add promotions and feature customer favourites all with standard functionality such as price controls etc. You can use it to prompt your telesales team with alerts on special offers, particularly on products with a short shelf life. And if spot customers who haven’t bought a certain product from you in a while, you can take action to encourage them back in.
• Fully Integrated Point of Sale – A fully-integrated POS system delivers live data at the point of contact. It offers valuable sales and stock information at order entry and enables you to prompt staff with alternatives, supersessions, related items, discounted stock with a short shelf-life etc.
• eCommerce Integration– You must be able to sell online today. Ensure your system of choice has the capabilities to quickly and easily integrate a B2B and/or B2C ecommerce solution that automatically updates your back-office system. Additionally, a self-service online customer account portal for your B2B customers is a must if you want to enable repeat ordering.
• REST API – Your system must support all levels of integration, ensuring your ERP system is your single source for master file information and data analytics. From EDI to ecommerce, you require limitless integration capabilities and modern ERP systems that use REST API technology can facilitate this. 
• Advanced Rebate Management – Your ERP software should proactively help you to manage your rebates. Rebate Management involves easy tracking of progress, pro-active notification of rebates due and where threshold boundaries are close. The administrative savings here are huge and it can really take the hassle out of managing complex rebate structures
• Advanced Replenishment Rules – Through effective re-calculation of the minimum, re-order and maximum stock levels, your system can support the purchasing process by suggesting items to be ordered, taking peaks and troughs into consideration.

Key features required

• Control desk/KPI dashboard – An unquestionable time-saver, a control desk or personal workspace is an easy way for a user/department/role to keep an eye on their KPIs.
• Batch-tracking – For managing and tracking manufacture, best-before, expiry dates and product batches in your warehouse, from supply to dispatch. It must also enable a quick and effective way to deal with product recalls based on batch tracking. 
• Automated Suggested Orders– By employing minimum and maximum order point recalculations and replenishment rules to your business using ERP software, you can better utilise your suppliers’ lead times and aim for optimal stock holding based on analysed, historical data. This, in turn, can increase your cashflow and greatly improve your customer services.
• Transport Scheduler – A transport scheduler is key to enabling you to manage your delivery schedule and fleet. Features such as auto allocating routes down to manually creating routes through drag and drop functionality or booking a journey at the point of sale should be catered for.
• Cash on Delivery – For many food and beverage distributors, facilitating COD or cash-on-delivery, is essential and the tracking of that is very important.
• Shipping and Container Tracking – This allows for the easy management of containers and container costs, particularly for those importing goods from the Far East etc.
• Different Product Types – Your system must be able to cater for different product types such as outers, inners, catch-weights, cases in units etc.
• Catch–weights – Catch weights in an ERP system simplifies the task of accurately tracking and reporting inventory and sales of products that is ordered by the unit, weighted at point of despatch and priced calculated by the weight e.g. meats, produce, cheese etc.
• Bonded Warehouse – A common requirement for many in the food and beverage section.  This is for when you import goods but retain them in a custom-controlled warehouse until such time that the duty owed on the goods is paid. This enables you to free up cash flow and ensure customs reporting compliance.
• Contactless delivery – with located tracked photo capture or e-signature for the new ‘low-touch’ economy we’re living in is essential.
• Consolidated picking – With consolidated picking, instead of picking products for each individual order, you pick by area or zone.

Key Considerations for Implementing ERP in the Food and Beverage Sector

When it comes to implementing new ERP or business management software, Benjamin Franklin’s quote, ‘By failing to prepare, you are preparing to fail’ should be at the forefront of your project.

Changing systems can be daunting, but putting in the time and resources prior to implementing your new business software can make your journey a great deal smoother; and yield massive rewards for your company.

So, in order to ensure a seamless move to new software, we would advise including the following elements in your pre-implementation plan.

1. Project Objectives – Think about what you are trying to achieve. What limitations are you coming up against in your current system? Consider improvements you want to make right across your organisation. Document your current pain points and solutions required to overcome them. Start with a list of your ‘must-haves’ before moving on to the ‘nice-to-haves’. Then based on your project objectives, draw up a list of potential software/vendors that best fit your needs and get a demo of their product/services.
2. Scope of Works – You have your own way of doing things. It’s what essentially makes you… you! The creation of visual, easy-to-understand workflow charts, while often seen as a tedious job, has repeatedly proven to be worth its weight in gold as you get deeper into your project deployment.
3. Project Team – Your ERP system forms the backbone of your business. Therefore, a migration of systems must be managed by a competent project team that has full support from your senior management.
4. Change Management Team – Creating a change management strategy alongside your implementation plan helps limit the resistance to a new system and can identify any problems before they become disruptive to day-to-day business.
5. Data Cleansing – Ensuring your project starts with clean, accurate and relevant data will save you time and money in the long run. Take the time now to decide how much historical data you wish to migrate to the new system and indeed how much data must be migrated for compliance reasons.
6. ERP vendor support – It is very important to find an ERP vendor that has experience in the food and beverage sector and will provide all the necessary technical and maintenance support for your system’s entire life cycle. Ensure that your ERP provider has a sound business reputation and will be around for the long-term.

If you’d like to learn more about the best practice tools and techniques you should employ in your business, our experts tell all in our ‘Effective Stock Management’ ebook. They talk about the benefits of implementing an effective stock control policy and illustrate how it can save time and money, increase efficiency and productivity, improve traceability, cash flow and customer service levels. You can download it here.