Distributors say they hope to improve their demand planning, automation and segmentation capabilities this year, according to a new analysis issued by a distribution software firm.
Phocas on Thursday released what officials said would be its first annual “Inventory Trends in Wholesale Distribution Report,” based on a survey of more than 100 wholesale distributors.
Phocas analysts said that distributors are responding to growing competition and increased economic volatility by holding more stock — and that the pattern reflected a “re-evaluation of traditional inventory management systems.”
In particular, the firm said, companies are prioritizing stock availability over cash flow: just over one-quarter of respondents identified between 6% to 10% deadstock tied to “over 90 days of stock held by 22%.”
In addition to citing the economy and competitors as their top challenges, distributors identified increased efficiency as their top priority: 45% of survey respondents were embedding additional “data-driven and automated warehouse solutions,” and 54% were seeking new techniques for demand planning.
“Demand planning is a core need for distributors, yet the industry faces an accuracy gap due to limited access to the right data,” Phocas co-founder and CEO Myles Glashier said in a statement. “Distributors that can keep planning up-to-date with current sales are lowering the cost of inventory and improving service levels.”
