Wholesale Distribution Companies to Benefit from New Industry-Specific Solution from SAP

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SAP AG (NYSE:SAP) today announced the launch of SAP for Wholesale Distribution, a new industry solution comprising SAPs core enterprise software and new tailored applications to help wholesale distribution companies improve operational excellence and profitability. SAP also announced the creation of a dedicated business unit, Wholesale & Trade, which will focus on the unique requirements of midsize and large companies in the wholesale distribution sector. Today, more than 1,000 wholesale and distribution companiesincluding industry leaders such as AZWELL Inc., Japan; the BayWa Group, Germany; and McKesson, United Statesutilize SAPs expertise, best practices and solutions to manage their business.
With its new solution and dedicated team, SAP is addressing an industry that, in comparison to other sectors in recent years, has seen less focus on leveraging IT advances to achieve business process improvements. As todays wholesale and distribution companies strive to compete in a strongly consolidating sector, gearing up their IT landscapes has become a critical requirement for realizing new business models and processes. Designed as a modular solution, SAP for Wholesale Distribution enables companies to incrementally deploy business applications that meet the most pressing demands of their organizations, suppliers and customers, while creating a scalable IT infrastructure to seize the new opportunities continually arising in this quickly changing market.

Long-standing SAP customers in the wholesale distribution industry are pleased with SAPs decision to strengthen its commitment to the sector. One such customer is San Francisco-based McKesson, a world-class leader in wholesale distribution of pharmaceutical, medical and health care products and services.

With the new industry solution and business unit, SAP will be even better aligned to support our business strategies and build on the progress weve made together in driving new, more efficient business processes, said Keith Mallonee, senior vice president, Service Delivery, McKesson. The dedicated SAP teams deep insight into what moves our market will be an invaluable asset as we continue to grow our business. With SAPs powerful solution set, we will be able to stay on top of the latest advances in business software and technology to quickly adapt our processes to the markets rapidly changing demands.

Standard Solution for an Industry in Transition
Facing small margins, cost pressures and the emergence of new players such as logistic service providers in the hard-fought wholesale distribution market, many wholesalers are outsourcing their core business operations and changing their business models. They are increasingly offering value-added services to tap new revenue sources, distinguish themselves from the competition and improve customer loyalty. Retailers and manufacturers are expanding operations internationally, opening the opportunity for wholesale distributors to offer localized services that address country-specific trade requirements.

Addressing a wide range of wholesale distribution segments such as foodservice and grocery, industrial, and medical and healthcare, SAP for Wholesale Distribution comprises core components of mySAP Business Suite and new vertical functionality to support evolving business models at all levels of the organization across management, core business and wholesale support processes.

SAP for Wholesale Distribution improves wholesalers and distributors daily procure-to-pay and order-to-cash processes with new wholesale-specific functionality for purchase order, warehouse management and inventory optimization, direct store delivery and trading business. The industry solution provides the marketing, logistics and financials capabilities that wholesalers and distributors need to offer customers and suppliers value-added services such as loyalty management, labeling and central billing of invoices. In addition, companies gain comprehensive profitability analytics capabilities to help improve operational excellence across the entire supply chain. Through an agreement with software provider Vistex, SAP covers an additional need for companies operating in the U.S. market with an integrated solution for handling chargeback processes.

Based on the SAP NetWeaver platform, SAP for Wholesale Distribution enables wholesalers and distributors to integrate complex system landscapes, better manage master data and create collaborative services. With SAPs open platform, wholesalers and distributors can quickly adapt business models and strategies to changing market demands and easily implement emerging technologies such as radio frequency identification (RFID).

Specialized Solutions for the Midmarket
SAP addresses the needs of midsize wholesalers and distributors to implement business processes quickly, reduce costs and compete effectively with pre-configured software packages delivered through its global partner network. More than 40 tailored SAP partner solutions are currently available, covering highly specialized industry processes and local market needs. In addition, SAP offers midmarket solutions based on best practices for a broad range of sub-segments including food, beverage and meat wholesale.

Todays announcement underlines SAPs strategy to drive business innovation and intensify software specialization for the diverse business models and segments of the wholesale distribution industry, said Peter Kirschbauer, member of the extended management board, SAP AG. By tailoring our proven applications and innovative best practices to wholesale and distribution businesses, SAP has created a standard solution that allows companies to incrementally bring their IT landscapes up to speed and stay on top of this dynamically changing global market.

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