A distributor management system (DMS) is software that a consumer-goods company uses to run its distributors and its sales representatives as they sell to lakhs of neighbourhood kirana shops. In India, these companies are called FMCG companies, short for fast-moving consumer goods: soap, biscuits, tea, shampoo and other everyday products.
Most FMCG products in India do not go from the company straight to the shop. The company sells to a distributor in each town or area. This sale is called primary sales. The distributor keeps the goods in its own godown, a local warehouse, and sells them to the shops around it. That sale is called secondary sales. Each distributor may serve 300 to 1,000 shops, and a large company may have thousands of distributors. The company's sales representatives visit the shops every week, take orders and check the shelves.
The DMS runs the distributor's side of this. It records the distributor's stock, each shop's orders, the deliveries, the bills and the payments. It also applies the company's schemes. A scheme is an offer for shops, such as one free carton for every five bought, or a discount on a new product. The company pays the distributor back for the cost of each scheme. This repayment is called a claim, and the DMS calculates it.
Here is a typical case. A soap and detergent company has a distributor in Patna that serves 600 shops. On Monday, a sales representative visits 35 shops on her route. In each shop she opens field sales software on her phone. It shows the shop's past orders and suggests what to order. One kirana owner wants 4 cartons of bathing soap. This month, a scheme gives one free carton for every 5 cartons ordered. So he orders 5 and receives 6. The order reaches the DMS at the distributor, which checks the stock and creates the bill. The next morning, the distributor's van delivers it. At the end of the month, the DMS adds up all the free cartons that the distributor gave away and sends the claim to the company.
The company now sees every shop's secondary sales each day, not just what it sold to the distributor. So it knows which products sell in which areas. The DMS sends this data to the company's enterprise resource planning (ERP) system and to its customer relationship management (CRM) system. A representative can also photograph the shelf, and shelf image recognition checks whether the products are displayed as agreed.
How is a DMS different from a B2B ordering portal? A portal lets a shop order directly from a seller. A DMS runs the whole chain from the company through the distributor to the shop, including the representatives and the schemes.