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Wholesaler’s Survival Guide to Inventory Reports

Why is it so difficult to extract a usable, readable, and value-adding inventory report for wholesale executives and their salespeople?

An inventory report is a critically important sales tool that are used every day by multiple users at most wholesale companies. Most software systems and ERPs have all of the data you need, so why is it so difficult to extract usable, readable, and value-adding reports?

Now is as good a time as any to reevaluate your inventory report.

Rogue Spreadsheets

Rogue spreadsheets are ubiquitous at so many wholesale companies and the bane of a wholesale executive’s existence. (Okay, maybe that is overstating the case, but only by a little bit.)

What’s wrong with these spreadsheets and why do we call them rogue?

On the simplest level it is an indication that your software is not delivering for users. At a higher level, it usually means that critical usable information is hard to obtain in a timely fashion.

In addition, it often means that you have a lack of transparency and that the most useful information isn’t shared with all interested parties at your company. Production people have spreadsheets that salespeople and allocaters may find useful. Allocaters may have spreadsheets that sales and finance may find useful.

On top of all that these spreadsheets often represent double work and are subject to increased rates of human error.

And if all that is not cause for concern, then consider the countless man hours spent, especially by your sales people, creating these error-prone spreadsheets.

So it’s like your critical data has gone off the grid. It lacks transparency, creates double work, and this is crucial—it is not subject to full accountability.

At the same time, users are making the decision to go rogue for a reason. They may be struggling with the system in place and have found spreadsheets to be a useful work around. If you can successfully bring that rogue data back into the coral, your wholesale company, especially your sales team, may see significant benefits.

An Inventory Report as a Powerful Sales Tool

You and your salespeople are getting ready for a buyer presentation. How often do you see sales people spending significant amounts of time exporting data and images into spreadsheets that they manually manipulate? You know the data exists in your software. In fact they pulled the information from your system. So why all the fuss?

Most software systems don’t give users enough flexibility in the way they aggregate and filter data. They may require customization to get you the ability to filter and sort and manipulate data that is functional in the real world.

For example:

The buyer from a company, let’s call them TJMin, is coming in to the showroom. You want to select a number of items within 2 product categories to show them. You don’t want them to see all of the items available, nor do you want to show them every product category.

In addition, you don’t want them to see that you have 20,000 units in stock of an item because you know you will get hammered on the price. You want to show no more 5,000 units available.

On top of that you want your “selling price” to reflect a 45% margin, rounded up to the next nickel or quarter.

And of course you want to have all that data and more, including landed cost, on your own version of the same report, so that you can work the meeting with ease.

That’s why salespeople, understandably, go rogue. They may feel like they have no choice. But all of that data is available in your system and it is a time suck to manipulate.

If your salespeople could take a 3 hour project and get it done in 15 minutes, how much more effective could they be? So why not invest in the ability to deliver usable information to your sales team?

Delivery Reports

Let’s get real. Factory delivery dates are constantly changing. A safety inspection causes a delay in production. Your factory jumped some other product ahead of yours on the production schedule. You are waiting to consolidate goods to fill a 40′ container rather than shipping a partial or half container. Somebody screwed up on your production team. The reasons (and sometimes excuses) are as numerous as the stars in the sky. Yet the reality is that everybody needs to know when delivery dates change, and most importantly, they need to know which orders are going to be effected.

Too often we see rogue spreadsheets in play at production so that salespeople are left with stale information until it is very late in the game. Even when they are informed that ETD has changed they are at a loss to determine if their order will will be filled by the first container or by the delayed second container. They may not know how long to pad for ocean or air freight, customs clearance, and warehouse turn around.

With the right software in place, salespeople can be alerted with timely and relevant information. The system would calculate which orders may be effected, well in advance of shipping time. Then salespeople can try and make adjustments, manage expectations, and make decisions that can reduce compliance related chargebacks. But they can only be held accountable if they know that their order will be late and by how many days.

Other important inventory reports

A few more useful inventory reports are:

  • Oversold reports
  • Available to ship reports (On hand – current period orders)
  • Available to sell reports by time period (Future on hand + period’s receiving – period’s orders)
  • Inventory valuation aging

Making reporting useful in the real world

Of course you need to periodically reconcile an inventory but adding automation software is key to your inventory report process and well worth the investment.

Most often, a system inventory report will get you 85% or more of the way toward your informational goals. But it is that last bit of the way that makes the information useful in the real world. Unfortunately, it is that last bit that is often the most difficult to navigate.

Wholesale Executive Insider is a publication dedicated to helping owners of wholesale companies stay up-to-date with the latest industry insights to improve their operations and increase their bottom line.

Our team has deep industry knowledge and a network of solution providers that help wholesalers run their businesses efficiently. If you’d like to get free advice and recommendations on better inventory reporting, feel free to book a time to speak 1-on-1 with one of our knowledgeable industry advisors.

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