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Five questions a distributor's controller keeps asking
What did this pallet really cost us?
Supplier price is only part of it. Inbound freight, customs duty and broker fees land weeks later on separate invoices. Business Central assigns them to the receipt lines as item charges, so the item's cost and every later sale carry the full landed amount.
Which customers get which price?
Price lists can be set per customer, customer price group or campaign, with quantity breaks and start and end dates. Sales staff see the right price on the line instead of checking a binder.
Why are we out of the fast movers again?
Each item gets a reordering policy such as fixed reorder quantity, maximum quantity or lot-for-lot, with safety stock and lead times. The requisition worksheet turns those rules into suggested purchase orders every morning.
Where is it in the building?
Locations can require bins, put-away and picks. At the advanced setting, directed put-away and pick tells the warehouse where to store and where to pick, based on bin rankings and capacity.
Did we ship it without touching it?
Drop shipments link a sales order to a purchase order so the vendor ships to your customer, and special orders buy the exact item for one customer through your dock.
Landed cost without the month-end surprise
The most common margin leak we see in distribution is freight booked straight to an expense account. The product looks profitable at the line level while the overhead bucket quietly grows. Moving those costs onto the items changes the story, and sometimes it shows that a popular product line is barely breaking even.
In Business Central, a freight or duty invoice is posted as an item charge and assigned to one or several receipts, split by quantity, amount, weight or volume. If the goods were already sold, the adjust cost routine pushes the extra cost through to cost of goods sold. This is standard functionality, not an add-on, though it only works if purchasing staff match the charge to the right receipt.
Distribution task by task: standard, add-on or outside
Where the fit gets thin for a distributor
- ✓Labor management, wave planning by carrier and slotting optimization are not standard. Large high-volume warehouses often run a separate warehouse management system beside the ERP.
- ✓Complex rebate programs with tiers, retroactive accruals and claim tracking need an add-on. Without one, finance ends up back in spreadsheets.
- ✓Price lists work well, but a large book of contract prices changing weekly need a clear import process, or the list becomes the problem it was meant to solve.
- ✓Trading partners that require EDI documents will not accept emailed PDFs. Budget the EDI piece from the start rather than discovering it at go-live.
Distributor questions before choosing an ERP
Is Essentials enough for a wholesale distributor?
Usually, yes. Sales and purchasing, pricing, item charges, locations, bins, warehouse shipments and directed put-away and pick are all available in Essentials. Premium adds manufacturing and service management, which pure distributors often do not need. We confirm against your actual process before you buy licences.
Can Business Central replace our separate warehouse system?
For many small and mid-sized warehouses, yes, especially once a scanning app is added for pickers. If you run many shifts with labor tracking, cartonization and carrier rate shopping inside the warehouse system, keep it and integrate. The right answer depends on order volume and how the floor works today.
How do we handle customers who order using their own part numbers?
Item references store the customer's number against your item, so the sales line accepts their code and prints it on documents. The same feature stores vendor part numbers for purchase orders. It removes a surprising amount of manual lookup from order entry.
Can we see margin per order before we ship?
The sales order statistics page shows expected profit using the item's current unit cost. Final margin depends on the cost at posting and any item charges that arrive later. A Power BI report built on posted value entries gives the true picture by customer, product line and sales rep.
What happens to our open purchase orders and stock at go-live?
Open purchase and sales orders are loaded as open documents, and stock is loaded by location and bin at its current cost. We reconcile quantities and values to your old system before the cutover is signed off. History is usually kept in the old system or a reporting database rather than loaded line by line.
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