Many manufacturers and FMCG, pharma, electrical or building material brands sell through distributors, who then sell to retailers. Once goods reach a distributor, the brand often loses visibility. How much stock is there? What is selling to retailers? Are schemes being passed on? A distributor management system (DMS) closes this gap.
Primary and Secondary Sales
- Primary sales: from the manufacturer to the distributor.
- Secondary sales: from the distributor to retailers.
Most brands know their primary sales well. Secondary sales show actual market demand.
Key Features of a DMS
Distributor Ordering
Distributors place orders with the manufacturer online, with stock visibility and scheme application.
Distributor Inventory
Stock levels at each distributor, updated with purchases and sales.
Secondary Sales Capture
Retailer orders and invoices recorded by the distributor or through salesperson apps.
Schemes and Claims
Trade schemes, discounts and free goods configured centrally, with claims tracked and settled transparently.
Retailer Master
Outlets with location, category and purchase history.
Salesperson App
Beat plans, retailer visits and order booking from the field.
Reports
- Secondary sales by product, region and outlet.
- Distributor stock levels and ageing.
- Scheme performance.
- Distributor and salesperson productivity.
"Primary sales tell you what you sold. Secondary sales tell you what the market bought."
Integration
A DMS works best when connected to the manufacturer's ERP for orders and invoicing, and to distributors' billing systems where possible, to avoid double entry.
Adoption by Distributors
Distributors need a reason to use the system: faster order processing, accurate scheme claims and less paperwork. Keep it simple, provide training and support, and roll out in phases.
Common Questions
Do distributors need to change their billing software? Not always. Some DMS setups integrate with existing billing; others provide a simple billing module.
How quickly can secondary sales data be available? With daily syncing or real-time entry, managers can see secondary sales trends much faster than through monthly reports.
Where should rollout begin? With a few cooperative distributors in one region, then expand after resolving issues.
Mistakes to Avoid
- Launching across all distributors at once without a pilot.
- Making distributor data entry complicated or duplicated.
- Running schemes outside the system, which makes claims hard to verify.
- Ignoring distributor feedback during rollout.
- Measuring only primary sales after implementation.
Getting Started Checklist
Define retailer categories and beats, set up products and schemes, select pilot distributors, train their staff and agree on how secondary sales will be captured daily.
Measuring Success
Track the share of secondary sales captured in the system, scheme claim settlement time, distributor stock ageing and order fill rates. Rising data coverage and faster claim settlement are early signs of adoption, while better fill rates show real business impact.
How ITELLIC Helps
We build custom ERP, ordering portals and field sales apps for manufacturers and distributors. Contact us to discuss your distribution model and the visibility you need.
Custom ERP Systems
One system for purchase, production, inventory, sales and accounts.
