# Distribution operations > The numbers a wholesale distributor runs on, explained with formulas, worked examples and calculators that work with data from any ERP system. Source: https://docs.lumina-erp.com/distribution/ **In short.** What the industry looks like, then one guide per metric: what it measures, how to calculate it, how to read it and how it goes wrong. Most include a calculator. A distributor makes money on thin margins and fast-moving stock, so small errors in how you measure inventory, service and cash add up quickly. These guides work for any ERP system. They define each metric, show the formula, walk through an invented worked example and explain the ways the number misleads. For a one-page summary, use the [KPI formula sheet](/reference/kpi-formulas/). - [Wholesale distribution at a glance](https://docs.lumina-erp.com/distribution/wholesale-distribution-at-a-glance.md): What wholesale distribution is, how NAICS sector 42 is organized, its size in Census and BLS data, how distributors make money and why the ERP is central. - [Inventory turns, days on hand and GMROI](https://docs.lumina-erp.com/distribution/inventory-turns-and-gmroi.md): How to calculate and read inventory turns, days on hand, the Census inventory-to-sales ratio and GMROI, with worked examples and the ways each misleads. - [Fill rate, OTIF and backorder rate](https://docs.lumina-erp.com/distribution/fill-rate-and-otif.md): Line, unit and order fill rates, what on-time in-full measures, why trading partners define it differently and how fill rate relates to service level. - [The cash conversion cycle](https://docs.lumina-erp.com/distribution/cash-conversion-cycle.md): How DSO, DIO and DPO combine into the cash conversion cycle, why distributors fund the gap before customers pay and what early-pay discounts cost. - [Safety stock, reorder point and EOQ](https://docs.lumina-erp.com/distribution/safety-stock-reorder-point-eoq.md): How the reorder point, safety stock for demand and lead-time variability, service-level z values and EOQ fit together, and why EOQ is only a starting point. - [ABC analysis and cycle counting](https://docs.lumina-erp.com/distribution/abc-analysis-and-cycle-counting.md): Rank items by annual usage value, set ABC cutoffs, add XYZ demand classes and run a cycle count program that raises inventory record accuracy. - [Landed cost, freight terms and Incoterms](https://docs.lumina-erp.com/distribution/landed-cost-and-freight-terms.md): What landed cost includes, four ways to spread freight across receipt lines, how late freight bills skew margin and what FOB terms and Incoterms 2020 decide. - [Units of measure and packaging levels](https://docs.lumina-erp.com/distribution/units-of-measure.md): How base, purchasing, stocking, selling and pricing units relate, where conversion factors go wrong and how GS1 identifiers and NIST handbooks fit in. - [Pricing and margin in distribution](https://docs.lumina-erp.com/distribution/pricing-and-margin.md): Margin versus markup, the pricing methods distributors use, where pricing leaks margin and how invoice margin differs from pocket margin, with examples. - [Demand forecasting basics for distributors](https://docs.lumina-erp.com/distribution/demand-forecasting-basics.md): Moving averages, weighted averages and exponential smoothing by item and location, plus seasonal and lumpy demand and how to measure forecast error. - [Lot and serial traceability](https://docs.lumina-erp.com/distribution/lot-and-serial-traceability.md): Lot versus serial tracking, forward and backward traces, the data to capture at receipt and shipment, a mock recall drill and the FDA food traceability rule. - [Returns and RMAs](https://docs.lumina-erp.com/distribution/returns-and-rmas.md): How a distributor runs return merchandise authorizations, from reason codes and restocking fees to inspection, vendor returns and effects on margin. - [Inventory adjustments and shrink](https://docs.lumina-erp.com/distribution/inventory-adjustments-and-shrink.md): The inventory adjustments a distributor posts, reason codes and approvals, the ledger impact, how to measure shrink and lower of cost and net realizable value. - [Vendor rebates and special pricing](https://docs.lumina-erp.com/distribution/vendor-rebates-and-special-pricing.md): How supplier rebates, special pricing agreements and ship-and-debit claims work for distributors, and how to claim, reconcile and accrue them correctly. - [EDI for distributors](https://docs.lumina-erp.com/distribution/edi-for-distributors.md): The X12 documents a distributor exchanges most, VANs versus AS2 versus APIs, partner onboarding, ASN and label chargebacks and how EDI lands in the ERP. - [Sales tax for distributors](https://docs.lumina-erp.com/distribution/sales-tax-for-distributors.md): How US sales and use tax works for a wholesale distributor, covering resale certificates, economic nexus after Wayfair, sourcing, drop ships and tax engines. - [Credit card fees and surcharges](https://docs.lumina-erp.com/distribution/credit-card-fees-and-surcharges.md): What card acceptance costs a B2B distributor, how enhanced card data lowers it and how to choose between absorbing, surcharging and discounting. --- Epicor, Prophet 21, P21 and DynaChange are trademarks or registered trademarks of Epicor Software Corporation registered in the United States and other countries. 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