When you are a building owner or a contract cleaner purchasing hundreds of thousands of goods and materials each year, understanding distribution lingo can become a bread-and-butter issue. AFFLINK wants everyone, including building owners, managers, cleaning professionals, and distributors, to have a better understanding of what distribution is all about.
 
According to Michael Wilson, vice president of marketing for AFFLINK, this starts with understanding some of the key words used in distribution.
 
"Unfortunately some of these terms may sound a bit baffling," he says. "But when you are a building owner or a contract cleaner purchasing hundreds of thousands of goods and materials each year, understanding distribution lingo can become a bread-and-butter issue."
 
According to Wilson, some of the key distribution terms we should know include:
 
Supply chain management
Virtually every product that reaches the end-customer represents the cumulative efforts of multiple organizations, referred to as the supply chain. Effective supply chain management maximizes customer value, minimizes costs, and delivers products in the most effective and efficient way possible.
 
Strategic sourcing
Strategic sourcing is considered a key aspect of supply chain management. It involves examination of purchasing budgets; negotiation with suppliers; and ongoing assessments of product procurement and supply transactions.
 
Supply chain optimization
This is the application of processes, tools, and technology to ensure the optimal distribution of goods and products. The goal is to encourage collaboration within the supply chain to improve forecasting and inventory management, while reducing costs.
 
Inventory days of supply
This applies to forecasting how many products are needed and when. Use the following calculation: total inventory, divided by average daily consumption, equals inventory days of supply.
 
Analysis summary
A report, often prepared by distributors using web-based software or technologies, that evaluates products used in a facility; looks for potential cost savings and product alternatives; and uncovers what are termed "hidden opportunities" to meet a customer's goals and enhance product selection.
 
"Some end-customers need clarification as to what their company goals are when it comes to purchasing supplies," says Wilson. "Is it to go green? Be more sustainable? Reduce costs? The analysis summary will help clarify this and more."