DSD best practices: Optimize your DSD operation

DSD best practices: Optimize your DSD operation

In “Why is the DSD Distribution Still Working in 2023?” we explored why Direct Store Delivery (DSD) model was still valid. However, that doesn’t mean that there are challenges that DSD companies must face and respond to. In this article, I identify these challenges and highlight DSD best practices.

What and why DSD?

Direct Store Delivery (DSD) is when the manufacturer or distributor delivers the products to each store directly and not through the retailer’s distribution centers. This model has benefits for both: retailers and manufacturers. I have mentioned them as part of other articles. Below is a summary of the main ones.

1. Reduce the risk of damaging fragile goods or the expiration of perishable products.
2. Reduce the time to get products on stores’ shelves.
3. Help to improve seasonal sales and expired products on shelve through offers and merchandising.
4. Connect brands directly to retailers, helping them build a better relationship with the end market players.
5. A DSD model reduces costs and increases profits.
6. Improve consumer experience.

DSD main challenges

A direct store delivery business is responsible for fulfilling stores’ orders, delivering them, arranging the products on the shelves, and handling promotions. Such a wide range of duties poses many challenges that involve warehouse personnel, store employees, and customer satisfaction. Below is a list of the main ones.

1. Digital skills: Due to the increase of digital technologies, the need for developing and improving digital skills for the workforce has been a growing concern for DSDs.
2. Streamlining processes: DSD’s need to effectively manage their operational processes to remain competitive and provide better customer experience.
3. Supporting technology innovation: For DSDs to stay ahead of their competition, they must constantly look for ways to innovate and use new technologies.
4. Cost optimization: A challenge that most DSDs face is finding ways to optimize their costs while provide high-quality service.
5. Data analytics and customer insights: In order to make the right decisions that lead to providing a good service, DSDs must use data and have a deep understanding of customers..
6. Developing the customer experience: The customer experience has become a primary factor for DSDs to remain competitive, since it is important for customers to receive a positive experience when interacting with them.

DSD best practices

The success of a direct store delivery (DSD) system depends on effective and efficient DSD best practices. Following DSD best practices can help optimize the operation and reduce costs while delivering the best results. Below is a list of the seven best DSD practices we have used.

1. Use reliable and effective Route Accounting technology solutions to manage orders, track delivery status, and improve visibility along the entire Direct Store Delivery process.
2. Use user friendly and accessible DSD software to route staff, sales reps, and back-office personnel to enter sales and order information.
3. Ensure timely deliveries of fresh products with temperature tracking to ensure quality.
4. Educate and train drivers on the delivery processes to increase accuracy.
5. Audit returns from stores to detect shrinkage, track defects, and monitor customer service levels.
6. Analyze data from delivery transactions to improve operational efficiency.
7. Continuously assess processes and practices to identify areas for improvement and growth.

I hope this article has been helpful to you. I will continue to post information related to warehouse management, distribution practices and trends, and the economy in general. If you are interested in this article or want to learn more about Laceup Solutions, please subscribe to stay updated on future articles.

There is a lot of relevant information on our channel. Check it out this video on DSD software.