Special Technology Issue:

The Software Solutions Slowdown

• Distributor software programs that emphasize increased productivity, multiple functions and cost savings are getting tweaks and updates.

Talking Technology

• Distributors and retailers are weighing the benefits of today’s technology, which can help bottom lines during troubling times

by Lisa White

As far as distributor software is concerned, 2009 will not be known as the year of mind-blowing innovations.

With the slowdown on spending, many technology companies are more focused on improving their current programs and keeping prices affordable for small and mid-size distributors.

In terms of convenience distributors, software that enhances productivity, helps cut costs and provides multi-purpose use has garnered the most interest in this segment.

“The focus of our software and technology program has been to increase accuracy and draw costs out of the system,” says Charles Schimmel, vice president and general manager of Lyons Specialty Company, a distributor based in Port Allen, LA.

Enhancing productivity
In this economy, one of the recurring themes with distributors is the need to better manage warehouses from the perspective of labor, pick accuracy and overall cost.

According to Jim Gaspar, senior vice president of sales and marketing at Phoenix, AZ-based AFS Technologies, a software supplier, best practice warehouse management incorporates labor standards that allow distributors to gauge how efficiently staff is executing against daily orders. “Being able to identify whether each shift or team member is working at prescribed levels of efficiency allows distributors to better manage these processes,” he explains.

There are several software programs that help improve productivity, which not only increases sales and profits, but also plays a part in reducing operating expenses.

Hammonton, NJ-based ProCat Management Services’ PickRight is a wireless touchscreen picking system that can train new employees in about 15 minutes. “Pickers can increase their productivity 20 percent with this program,” says Steven Stomel, CEO of the company.

Lyons Specialty Company was a beta site for PickRight, testing the program in January of last year. With this system, pickers scan onto pick tickets electronically. A wrist computer guides them to the warehouse slot, where they scan product UPCs to verify items prior to picking.

The company incorporated the program in an effort to increase picking accuracy, efficiency and speed.

Schimmel says taking the human element out of the process has been beneficial.  “Many things can happen in a mispick. If we can take out the human element, it will increase our accuracy and efficiency, while keeping our costs in line. Getting it right the first time is key,” he says.

PickRight’s measurement tools have given Lyons Specialty the ability to track both productivity and results.

Incorporating this automation has been a seamless endeavor. “One would think automation would make things more difficult, but it has simplified our operations. Plus, employee acceptance of this tool has been phenomenal,” Schimmel notes.

In an effort to eliminate human errors, Lyons Specialty is in the process of incorporating a UPC scanning program on inbound and outbound deliveries to automate its receiving functions.

L.J. Zucca, a distributor located in Vineland, NJ, also incorporated PickRight in an effort to cut down on picking errors and increase accuracy.

Marie Pinto, director of customer service and IT, says the program allows pickers to better concentrate on the task at hand. “PickRight tells pickers the location of the product, the product that needs picking and the quantity they need to pick. If there’s a problem, they have the option to override the program and pick manually,” she says.

Zucca’s pickers wear label printers, which provide package information, customer identification and route specifics. This has helped reduce delivery errors, Pinto says.

To improve warehouse efficiencies, Zucca also uses Tax-Right for its cigarette stamping machines, Forms Print, and Retalix’s supply chain software.

Consolidated solutions
Plano, TX-based Retalix provides programs combining enterprise resource planning (ERP), warehouse management systems (WMS) and transportation solutions to provide small- and medium-size distributors with a value proposition under one umbrella.

“We see value in combining enterprise and supply chain software, rather than looking at it from a point solution,” says Isaac Shefer, Retalix’s executive vice president of product development.

Thomas & Howard Company, a distributor located in Columbia, SC, has been running Retalix’s Power Suite program since July of 2007.

According to David Hite, director of IT, this software has improved productivity, saved costs and reduced errors. “In the past, we didn’t keep track of overhead or what was in each warehouse slot. Now, because everything is labeled, scanned and shelved, we know where all products are located,” he explains.

The software’s Internet application has received high marks from Thomas & Howard’s c-store customers, who can order in real time, maintain retail information such as accounts receivables and see product movement.

“C-stores need us to support their needs from a data standpoint, whether this means supplying clean invoices fast and efficiently, providing movement information from a vendor tracking standpoint or expediting their rebates. Today’s software allows them to accomplish these tasks and more,” Hite says.

The company will soon incorporate a new delivery software program that allows drivers to issue real-time credits at customer store sites. With this program, Thomas & Howard hopes to see a larger return on investment and added cost savings.

“Soon we’ll be installing another Retalix module called Power Analyzer, which allows us to measure business prices and metrics internally,” Hite says.

While larger distributors are focusing on efficiencies and incorporating the latest WMS and scanning programs into the warehouse, smaller companies are not able to make the same costly investments.

“Small- and medium-size businesses are more focused on customer service to better differentiate themselves from their competitors,” says Michael Benedick, director of sales for Mulvany Attard Associates, a technology provider located in Richmond Hill, Ontario, Canada. “Rather than focus on the software, we look at distributors’ needs in relation to their daily activities. Then we can provide the tools to help them become more efficient.”

McLane Advanced Technologies, based in Temple, TX, offers a real-time distribution system for supply chain management. The MDS application is fully-integrated, managing all tasks from product procurement through delivery. It also tracks product and labor effectiveness.

According to Earl McGoldrick, senior business analyst, distributors are looking to maximize productivity and accuracy in the warehouse. “Distributors of all sizes have the same issues, so software suppliers are trying to make these programs more affordable and accessible,” he says.

For companies that don’t have the resources, time and money to invest in EDI (electronic data interchange), Transcepta of Aliso Viejo, CA, offers a program that can help expedite and simplify accounts receivable.

“The primary objective of this program is to help companies solve the problem of inbound paper invoices from their suppliers,” says Shan Haq, vice president of marketing and product management. “Unlike EDI, there are no upfront fees. We enable suppliers to submit invoices from their existing invoice system. This allows suppliers to get paid more quickly and buyers to process invoices more efficiently.”

As electronic payment remittance becomes more prevalent, it is helping to reduce costs.

“Our distributor customers are looking to economize,” says Jovo Filips, vice president of business development, sales and marketing at Rutherford & Associates, a Holland, MI-based technology provider. “C-stores need distributors to partner with them to assist in pricing, promotions and product mix.”

Refined programs
A number of software suppliers have refined their existing programs, enhanced features and updated applications.

West Chicago, IL-based BFC has refined its Truck Builder module, which automatically considers routes and stops to create a loading template, says Sam Flannery, vice president.

After implementing this software about two years ago, broadline distributor Ellenbee-Leggett, located in Cincinnati, OH, saw its accuracy increase by 85 percent and throughput grow by 25 percent, says Mark Morton, director of operations. “In the past, we would pull orders on a single pallet jack, building one skid at a time. With this program, we’re able to build two skids simultaneously,” he says.

The company also uses BFC’s voice picking software, which has increased productivity and minimized errors. “Pickers are interacting with the voice program, so their concentration is better and accuracy has improved,” Morton says.

CDR recently released updated versions of its distributor software programs, which include DAC, SupplyLogic and VMR Console.

According to Jebb Maginnis, CDR’s president, distributors are focusing on core warehouse operations. “They are interested in decreasing operational costs by gaining efficiencies,” he says. “The enhancements of our programs help improve receiving, stocking, picking and loading.” The company also is enhancing its returns management module, which automates returns.

Arlington, VA-based MicroAnalytics is updating its TruckStops routing program software to ensure it is compatible with new mapping programs.

“GPS vendors have built seamless interfaces between their software and ours,” says Dan Buttarazzi, director of marketing.

Chicago, IL-based Access International also has added more functionality to its software products.

According to Ray Walsh, vice president, sales and marketing, its automated order entry program now provides expanded information and a more detailed display for use with laptops or pen tablets. “Our newest application calculates orders based on historical information,” he says.

Before deciding on a software program, distributors need to consider the ease of use, benefits and return on investment.

“Today’s distributors want to see some return on these programs as quickly as possible, whether by means of cutting costs or bringing in more business,” Hite says.

Lisa White, a freelance writer based in Cary, IL, is a regular contributor to Distribution Channels.

Software Suppliers
•    Access International, Chicago, IL, (312) 920-9366, www.ai2.com
•    AFS Technologies, Phoenix, AZ, (602) 522-8282, www.afsi.com
•    BFC Associates, West Chicago, IL, (630) 405-3160, www.bfcassociates.com
•    CDR, Covington, LA, (985) 626-8408, www.cdrsoftware.com
•    McLane Advanced Technologies, Temple, TX, (254) 770-6167; www.mclaneat.com
•    MicroAnalytics, Arlington, VA, (703) 841-0414, www.bestroutes.com
•    Mulvany Attard Associates, Richmond, Ontario, Canada, (905) 889-6939, www.mulvanyaa.com
•    ProCat Management Services, Hammonton, NJ, (609) 567-1900; www.procatms.com
•    Retalix, Plano, TX, (469) 241-8400, www.retalix.com
•    Rutherford & Associates, Holland, MI, (616) 392-5000, www.eostar.com
•    Transcepta, Aliso Viejo, CA, (949) 330-6750, www.transcepta.com