Mergers and Acquisitions – How Do You Navigate this With Your WMS and Shipping Software?
Just within the past five years of my career spanning over two decades, I cannot believe the number customers who have been acquired, purchased another company, or merged. With so many things that need to be considered, there could easily be dictionaries written about the do’s and don’ts of Mergers and Acquisitions including employees, assets, debts, license agreements, processes, locations, accounts, finance, etc. Now, I’d like to discuss my favorite topic; how should your inventory control and shipping systems be addressed? Here are our recommendations.
1.Create an Internal Team with Representation of Each Company/Location/Division
Create an internal team to start evaluating the systems in place. If the systems vary, determine the best way for you to merge the systems together under one umbrella. Determine upfront costs, implementation costs, a study of each new company/facility, and a plan of what you can standardize and what you simply cannot. (Let’s face it, a similar company may have similar products but all companies have unique people, processes, and products.)
2. Take A Structured Implementation Approach
If it’s simply one company/warehouse, treat it as a new implementation with all the structured processes you need to take them live on what is a new “technology” solution for them. If you purchased multiple companies, determine the best phased approach over a period of time with real live goals in place. Once you implement one company/plant or location you have a better understanding and a plan in place that can be modified based on their uniqueness etc. Repeat the process, tweaking as you go.
3. Don’t Just Convert Bad Inventory Data/Do A Clean Count
In addition to the above, one of our recommendations if a client acquires a new company is a clean inventory count. This can be done with our Beginning Balance Count Feature using the wireless devices. Not only does this prevent converted bad inventory data during a critical time, it also provides experience with the wireless devices for those companies that were once completely manual.
4. Train Newer Team Members Properly
Train, train, train! I cannot express how important training is for your new team members. If you want new technologies, or your standard operational procedures to be implemented smoothly on top of testing and planning, this is one of the most important activities you should do. Determine if you have an internal group to help train new users or if you need to hire an outside vendor. Schedule the training and make sure that each team member can process their day in the life of transactions.
5. Evaluate Shipping Costs and Possible Re-negotiations on Contracts
Look at your logistics. Now determine if it is the best time to determine inventory shipping and movement. Should you incorporate an anchor warehouse that replenishes the other locations? Should you ship from one location, all locations? Can you look at renegotiating with your shipping carriers not that you have more buying power and more shipments? Should you leverage the multiple locations to directly ship to your customers or fulfill to consumers? All of these items should be investigated as shipping is a very important cost of doing business for distributors and manufacturers.
All in all, mergers and acquisitions require a lot of effort and teamwork. Make sure you are thorough in each step along the way to avoid issues and follow our recommendations for the best results. Learn more about how DCWarehouse functionality makes it easier for your business to navigate these changes and more here!