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Top ten ERP trends for builders’ merchants in 2023

The merchant industry is dynamic and competitive. That's why we've identified ten trends for the year ahead to help our customers stay ahead of the curve.

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The fast rate of digitization within the merchant industry shows why businesses must get current and stay current to take advantage of the latest developments in software. The market has changed over recent years, so tighter production timelines, increasing customer demands, and limited resources are just some of the challenges the merchant trade must overcome.

But when you know where merchant industry trends are heading, you can more accurately plan your business strategy, so you're in a better place to overcome these challenges. Recognizing that knowledge is power, Kerridge Commercial Systems (KCS) has identified the most significant trends they anticipate for the merchant industry in 2023.

1. More ERP systems in the cloud

The benefits of cloud-based computing are becoming undeniable for builders' merchants: a fixed monthly cost, a dedicated security team working 24/7, constant back-ups and hardware and software that automatically update.

The ongoing costs of the cloud are fixed to a certain degree. You know exactly what you're going to pay. We don't have to worry about our local server suddenly going down or suddenly having to stick more hard drives and RAM in it to cope with increased demand.
Darren House - MD of Electrical at Grant & Stone

2. Advancements in ERP intelligence

Modern ERPs are now more intelligent, integrating advanced analytics, AI, and machine learning into their main interface. Naturally, this leap in technology streamlines operations, from inventory management to customer relations. By automating data-driven decisions, these ERPs reduce manual errors and optimize supply chains, leading to substantial cost savings. Additionally, predictive analytics in ERP systems forecast demand, enabling builders to allocate resources efficiently. This not only saves time but also minimizes waste, contributing to both increased efficiency and profitability.

3. Increased focus on deploying the IoT

Customers increasingly expect merchants to cater to their needs with more personalized experiences. Investing in ERP systems capable of conversing with the IoT will help businesses manage their business intelligence more effectively and tailor bespoke customer experiences to increase retention. 

4. A greater need for industry-specific merchant solutions

The merchant industry is unique, and the increasing demand for ERP software means a 'one-size-fits-all' solution no longer applies. Instead, leading ERP providers offer more industry-specific functionalities and features, which means fewer costs are associated with customization. Naturally, merchants can then implement and deploy these industry-specific ERP systems quicker, which helps them achieve a better ROI. 

5. More focus on IT security

The shift to remote working has increased cyber-attacks, data breaches, and challenges in data security. Therefore, systems that process lots of data and link to CRM systems face growing threats. This circumstance then leads to many businesses intensifying their efforts to secure their ERP systems, especially with new GDPR laws concerning recent high-profile data breach incidents.

6. Two-tier ERP systems

The rise of IoT, cloud infrastructure, and big data are some of the integral parts of ERP technology that are developing at breakneck speed. So how can builders' merchants keep up? Many larger businesses have found that their existing ERP solution can only effectively deliver on some of their business requirements. For example, different ERP usage requirements at headquarters might be split between regional and subsidiary levels. In such a scenario, a two-tier ERP system can run an ERP solution at a corporate level (tier one) but operate its units and subsidiaries on a separate ERP solution (tier two).

7. More merchants will go mobile

A recent study found that 78% of businesses surveyed had employees accessing company data through mobile devices. As a result, several ERP solutions are adapting to offer integrated modules. Enabling work on the move, these applications support powerful functionalities beyond the yard or warehouse. Additionally, key stakeholders can see up-to-date analytics and forecasting, while employees can access real-time updates on the movement of stock.

K8 ePOD has streamlined our processes significantly. We no longer need to produce paper documents for our drivers or sort and file delivery notes on their return. All delivery information is on one screen. It’s a real time-saver.
Paul Cornford - IT Services Manager at Howarth Timber & Building Supplies

8. Streamlined processes through digitization

As businesses continue to evolve, integration between the main ERP system and various processes will naturally occur. At the center of this integration are ERP systems that allow merchants to manage the various areas of their business from one application. So, from stock levels through to accounting records and CRM, merchants can instantly share data across their operations and make more data-driven decisions.

9. Plug-'n-play ERP integration

KCS predicts that better integration using standard APIs will be a new trend for merchants. Users could use a core ERP solution for their primary business processes with a third-party solution for more specific requirements. An example would be a wholesaler using K8 for their distribution process with a third-party CRM and an independent sourcing solution. Customers will increasingly expect ERP service providers to allow seamless integration between these different solutions and their systems.

10. ERP systems will continue to evolve

As the global market evolves, ERP solutions are increasingly being relied upon by the merchant trade to reduce the costs involved in supply chains. The economic turbulence affecting all industries means ERP solutions will become more integrated with new technologies and increasingly tailored to the needs of the builders’ merchant industry. 

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