Wholesale distributors
What can AI do for a wholesale distributor?
A distributor can tell you what is in the warehouse. Which of it is earning is another matter.
A wholesale distributor doing about $10M a year knows total inventory and total margin, but usually cannot say which stock is earning its keep and which is parked cash, or what it truly costs to serve each customer once picking, delivery, and returns are counted. The purchasing decisions and the pricing decisions are therefore made on instinct.
A distributor holding $2M of stock at an average of two turns instead of three is roughly $650,000 of cash sitting still. That money is not lost, it is committed, which is worse, because it is invisible and it is already spent.
Gaps worth checking
- Which stock is earning, and which is parked cash?
- Do the discounts by customer size still make sense?
- Is a second warehouse the answer, or faster stock?
- Which spending is buying nothing at all?
- Why do tidy spreadsheets still not add up to a business you can see?
The right place to start is the one that is costing enough to matter.
The gap is usually between systems, not inside one.
Each system can be right on its own and still lose value in the handoff. These are the records that need to meet before you can see what the gap is costing.
- Your inventory system or ERP
- Purchase orders and supplier terms
- Picking and delivery records
- QuickBooks
- Customer price lists
- Freight bills
Named by what they do rather than by brand, because the brand matters less than whether the thing is connected to anything else.
What a wholesale distributor asks before they start
Our ERP already reports inventory turns. What is missing?
- Turns at the company level are an average across everything you stock. The decision you actually make is per line and per supplier, and that is usually the view nobody has.
We are on QuickBooks, not an ERP. Is that a problem?
- It is the normal starting point at this size, and it is not a barrier. QuickBooks holds the money accurately. It simply does not know your pick times, your delivery costs, or your customer service hours.
What is cost to serve and why does it matter?
- It is what a customer costs you beyond the goods: order handling, delivery, returns, and the phone calls. Two customers buying the same volume at the same price can differ enormously once it is counted, which is what makes a discount schedule quietly wrong.
Would we have to change how purchasing works?
- Not at the start. The first job is making the current decisions visible. Changing how they are made is a separate decision, and it is yours.
Who owns what gets built?
- You do, and the data with it. No licence to buy and no long contract.
Everything we have written for wholesale distributors
8 articles, newest first.
- Marketing
Trade Show ROI for a Wholesale Distributor: Which Leads Become Paying Accounts
A distributor can return from a trade show with a full lead list and no clear return. Trace contacts to first orders and account margin.
- Sales
Quote-to-Order Conversion for a Distributor: Which Offers Never Become Orders
A distributor sends prices all day but cannot tell which quotes stall, expire, or lose on stock and terms. Follow the offer to an order or a reason.
- Finance
Customer Payment Terms for a Distributor: Which Accounts Tie Up Cash
A distributor may give its biggest customers the longest terms without seeing their funding cost. Compare margin with the cash each account uses.
- Finance
How Do We Spend Money? Finding the Spending That Buys Nothing
Why a $12M distributor cannot see the payroll going into work that should not exist, and what it takes to find spending that never arrives as an invoice.
- Finance
Second Warehouse or Faster Stock: How a Distributor Decides Whether to Buy Space
Why a $13M distributor cannot tell whether it is out of space or full of dead stock, and what to check before signing a lease on a second building.
- Sales
Pricing Tiers by Customer Size: Do a Distributor's Discounts Still Make Sense?
Why an $11M wholesale distributor cannot say if its volume discounts still hold, and what cost to serve per account would show about the biggest customers.
- Finance
Inventory Turns for a Wholesale Distributor: Which Stock Is Earning and Which Is Parked Cash
Why a $12M wholesale distributor cannot tell which stock is earning and which is parked cash, and what the next dollar should buy instead.
- Operations
Tidy Spreadsheets Aren't a Business You Can See
Why a $6M wholesale distributor with tidy spreadsheets still cannot answer simple questions, and what connecting the data would take.
What AI can do in other trades
The gap changes by trade. The rule does not: find the recurring loss, put a number on it, then decide whether it is worth fixing.
Which small gaps have become worth checking?
Find more cashEnter your domain. See where cash may be slipping through and what to check first.
Have a question about a gap in your business? Contact us.