ance and sales.
A key finding of the research was the wide spread of technologies used and the disparate nature of sys- tems that are not necessarily “talking to each other” to provide a full view of operations.
Electrical and lighting businesses use a range of software systems to function: more than 95% of respondents use one or more software systems to run their business, from inventory/stock control to accounting software and CRM (customer relationship management).
81% of respondents within the electrical and lighting sector saw benefits from integrating dis- parate systems. 53% listed the main reason to use a single system as removing duplication of work across different departments, followed by future proofing business using latest technologies 53%, 47% citing reduced administration time, and 47% stating improved efficiencies by improved accuracy of information.
Single systems are beneficial for online stores, where stock checks and reporting ensure that customers have a good understanding of delivery timescales and product availability. Survey re- spondents confirmed that eCommerce has grown exponentially, with 89% stating that being able to sell products online easily is really important to them. Additionally, 83% of respondents stated that using an eCommerce platform was an effective tool for managing business operations. This comes as little surprise as businesses shifted online en masse to en- sure continued supply.
Anderson Electrical’s Director stated that the firm replaced a legacy system that was outdated with an integrated ERP system, which supported the company for success by efficiently managing stock and sales. Not only has it given Anderson Electrical a real-time view of its stock levels, incoming shipments and outgoing orders but the integration with the trade counter has also enabled them to be far more transparent and efficient with their customers, as it can provide up to date pricing information and gen- erate orders straight away.
“We are no longer running out of stock like we
ewnews.co.uk
used to because we can create workspaces to give us complete visibility. We’re also buying and selling at the right price because the system tells us. Profit4 provides us with powerful information, all in one place. It connects all areas of our business to make it more fool proof and gives us the confidence that nothing will be missed because there’s less human involvement.”
As the pandemic accelerated digital transforma- tion, cloud computing continues to be a driver for change, with 81% of respondents agreeing that host- ing applications and data in the cloud have improved efficiencies and productivity (or would improve them if cloud were implemented).
“As the pandemic accelerated digital transformation, cloud computing continues to be a driver for change.”
Despite the benefits of cloud, concerns about security remain, from 55% in 2019 to 61% in 2022. This reflects the growth in the moving of core applications and data to the cloud, and the miscon- ception of businesses still not realising that many cloud-based solutions, such as ERP, offer enhanced cloud security features to ensure that customer data remains secure.
Critically ERP systems are a key technology with 86% agreeing that ERP systems give greater avail- ability and control of stock. ERP refers to a suite of integrated software that businesses use to manage day-to-day business activities, such as sales order management, stock control, finance, CRM and more. When breaking down technologies that can make up an ERP solution, inventory/stock control (89%) and accounting (83%) were seen as the most effective elements when managing business processes. In a time when eCommerce has grown exponentially, in- tegration with third-party software, especially eCom- merce, online shopping channels, route planning and online payment methods is key, with 83% citing this as a benefit of using a single central ERP system. The main barriers to deploying an integrated
software solution were cost, with 50% citing it as a factor, down from 75% in 2019, followed by 47% with data security and 33% with business disruption. Cost is often associated with the misconception that ERP systems are only for larger businesses, and the lack of information about affordable subscription-based models.
Firms like NVC Lighting Ltd have already benefit- ted from automating processes by integrating dispar- ate systems. Jason Huang, Assistant CEO, explained how automation improved the ability to “track the whole processing of all kinds of orders, including sales, purchase and works orders. Additionally, all reports of operations can be exported quickly and accurately.”
Positively though there is a greater degree of acceptance of cloud technology and understanding that ERP systems are not just for larger companies. Digital transformation has no doubt saved many businesses that have pivoted to online sales, but manual processes are still a hindrance as are dispar- ate systems, both of which lead to inefficiencies. The 81% of respondents citing that hosting appli- cations and data in the cloud has improved efficien- cies and productivity means electrical and lighting businesses are now moving towards a more single view of a business, especially of inventory levels, and integrated technologies like ERP will lead to better profitability, increased productivity and accurate data for planning.
At OGL Software, we have seen our clients evolve since 2019, when we last conducted the same survey. Many have transformed their businesses at breakneck speed, but only through full visibility of all business processes, ideally via a single dashboard, will they fully understand their business, areas for improvement and a plan to meet the challenges that 2022 brings. Electrical and lighting companies need to streamline their businesses like never before to en- sure that they efficiently and quickly meet demand. Access to the full report is at:
www.ogl.co.uk/ profitability-in-uk-wholesale-businesses
December 2022 electrical wholesaler | 27
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