Just In Time Delivery Alleviates Inventory Concerns

Storing too much inventory can be expensive for distributors. At the same time, distributors are faced with the dilemma of ensuring that they have product readily available to meet customers’ next-day delivery demands.

Thankfully, wholesalers are helping distributors manage these inventory concerns by providing just-in-time delivery, a method for quickly delivering products to distributors when customers order them. Instead of distributors purchasing products and storing them in their warehouses until a customer is ready to order, distributors can simply contact their wholesaler on an as-needed basis. Once again, capital isn’t being tied up in slow-moving inventory.

Just as beneficial as just-in-time delivery, wholesalers also offer drop-ship programs where they deliver product directly to distributors’ customers. This proves to be advantageous for distributors as there is no need to bear the cost of inventory. Distributors instead simply ask wholesalers to deliver it straight to end users’ doorsteps. By taking advantage of this option, distributors are able to guarantee products to their customers via next-day delivery without physically having to move the product themselves.

Most distributors take advantage of wholesalers’ drop-ship programs. However, wholesalers say it isn’t recommended to use this feature all of the time.
“It isn’t right for all situations, but does allow for more efficient processing of certain types of orders, as well as providing greater speed to market,” Heeren says.

Instances where drop-shipping makes sense is when an end user is dealing with an urgent outage of a particular product and can’t afford to wait multiple days for the product to arrive. Instead of the end user potentially taking business to another distributor that has the product, the wholesaler comes through and saves the day — and the distributor’s business.