Direct Store Delivery (DSD): How It Works and Where Online Ordering Fits
Direct store delivery is built around the route visit, when a supplier or distributor brings goods to the outlet’s door. For beverage, snack, bakery and dairy businesses, that delivery may also involve checking stock, rotating products, arranging displays and collecting returns. The visit serves a commercial purpose as well as a logistical one.
Contents
- TL;DR: DIRECT STORE DELIVERY IN BRIEF
- WHAT IS DIRECT STORE DELIVERY?
- HOW DOES DIRECT STORE DELIVERY WORK?
- IS DIRECT STORE DELIVERY STILL WORTH KEEPING?
- WHAT IS DIRECT STORE DELIVERY SOFTWARE?
- WHERE ONLINE ORDERING FITS NEXT TO THE ROUTE
- HOW VIRTO COMMERCE FITS
- COMMON MISTAKES WHEN ADDING ONLINE ORDERING TO DSD
- BEFORE INTRODUCING ONLINE ORDERING
TL;DR: Direct Store Delivery in Brief
- Goods reach outlets without passing through the retailer’s distribution center.
- Beverages, snacks and fresh bakery products illustrate the value of frequent replenishment and merchandising.
- Orders can come through rep-led presell, sales from vehicle stock or outlet self-service.
- Route software handles activities such as loading, deliveries, invoicing and settlement.
- Online ordering works only if outlet orders reach the load plan before cutoff, at the same agreed price the rep and invoice use.
What Is Direct Store Delivery?
Direct store delivery is a distribution model in which a supplier or distributor delivers to individual outlets without using the retailer’s distribution center. Supplier-side storage and depots may still be involved. Depending on the arrangement, the service also includes merchandising, stock rotation and returns collection at the outlet.
SAP’s process documentation describes a cycle that begins with order processing and shipment preparation, continues through delivery and ends with processing the route’s transactions. The word “direct” describes the route to the customer; it does not mean that products travel straight from a factory without any intermediate storage.
Who uses direct store delivery?
The model suits products whose replenishment, presentation or freshness benefits from regular attention.
- PepsiCo’s 2025 annual report describes beverage and snack deliveries by the company, independent bottlers and distributors, with merchandising carried out by its employees or independent bottlers.
- In bakery, Flowers Foods describes independent distributors selling products, stocking shelves, maintaining displays and removing unsold goods.
- Dairy, confectionery and tobacco also appear among DSD applications, although the service arrangement varies by product and market.
The following comparison shows typical responsibilities, rather than universal contractual rules.
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Responsibility
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Direct to the outlet
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Through the retailer’s warehouse
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Delivery destination
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The individual store or outlet.
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The retailer’s distribution center, followed by onward store delivery.
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Shelf replenishment
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Supplier or distributor staff may stock, rotate and merchandise products.
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Usually handled through the retailer’s store operation.
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Returns
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May be collected and recorded during a route visit.
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Handled through the retailer’s returns process and supplier agreement.
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Outlet stock visibility
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Visits can provide shelf observations; continuous visibility requires additional data.
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The retailer holds its inventory records; supplier visibility depends on data sharing.
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Fig. Direct delivery versus delivery through the retailer’s warehouse.
Ownership of the goods follows the commercial agreement rather than the delivery label alone.
💡 The broader range of channel arrangements is covered in our guide to B2B ecommerce in FMCG.
How Does Direct Store Delivery Work?
Orders can be taken before delivery by a rep, placed online by the outlet or created during a sale from vehicle stock. These methods can coexist. The operational difference is when customer demand becomes known and how it is translated into picking, vehicle loading, delivery and settlement.
In presell, the rep records what the outlet needs for a later delivery. SAP distinguishes this sales visit from a visit that delivers goods. The order can be checked and processed before warehouse staff prepare the shipment.
With van sales, the vehicle carries stock for sale along the route. The customer buys from that load, and sale and delivery happen during the visit. This form of route sales depends on reconciling what left the depot, what was sold and what came back.
With self-service, the outlet creates the order. An accepted advance order can feed the delivery plan alongside a rep’s order. The customer must still meet the distributor’s cutoff, stock and delivery conditions.
Accepted advance orders from reps and outlets feed the delivery load plan.
Advance orders from both channels need to reach the load-planning process before dispatch. A DSD route may also carry speculative stock, allowing sales beyond those already booked.
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Method
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Who creates the order?
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What is known before loading?
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Potential failure point
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Presell
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A rep, working with the outlet.
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The accepted order is available before delivery preparation.
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A recorded order fails to reach fulfillment in time.
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Van sales
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The van seller, during the customer visit.
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The vehicle load is planned; the customer’s final purchase may be unknown.
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The required product is unavailable on the vehicle.
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Online self-service
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The outlet’s authorized buyer.
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The accepted order is available if submitted and processed before cutoff.
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The portal accepts a request that misses the intended delivery run.
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Fig. How orders enter the delivery operation.
Mixed operations are possible: a vehicle can deliver presold goods and carry stock for additional sales.
💡 Connecting orders, loads and settlement is part of the wider food distribution software environment.
Is Direct Store Delivery Still Worth Keeping?
Direct store delivery remains in use, although some businesses have moved particular categories to warehouse delivery. Its suitability depends on the product, customer and cost of service. Online ordering gives businesses retaining the model another way to capture demand; it does not settle the economics of the delivery network.
There are real departures to acknowledge. In 2019, Nestlé USA announced that its pizza and ice cream businesses would leave its company-owned frozen DSD network for a warehouse model. That year, Steve Banker’s Forbes column, “Direct Store Delivery Is a Deal With the Devil,” also examined tensions between suppliers’ and retailers’ priorities. Cost and control both belong in the discussion.
For businesses keeping the route, there is still the question of how much ordering must depend on a rep being available. Evening requests, missed calls and orders arriving after loading can expose the limits of that dependency.
Reps may reasonably worry that self-service will take their customers or commissions. Distributors may fear losing their relationship with the outlet. Those concerns need explicit answers about account responsibility, order visibility and incentives before launch.
AB InBev offers an example of how the work can develop. Its 2025 annual report describes BEES customer reordering alongside tools for field representatives and delivery teams. Digital purchasing and in-person service operate together.
This is one practical application of food and beverage ecommerce: making ordering available between visits while preserving useful service at the outlet.
💡 Explore how beverage distributors and FMCG brands introduce online ordering alongside the route.
What Is Direct Store Delivery Software?
Direct store delivery software supports the transactions and physical activities of a delivery operation. Depending on the product, it can cover visit planning, vehicle inventory, invoicing, payments, proof of delivery and settlement. Customer ordering may be included in the same suite or connected through a separate application.
The terms overlap, but their emphasis differs.
- Route accounting software focuses on recording and reconciling route transactions.
- Van sales software supports selling from vehicle stock.
- Direct store delivery software, often shortened to DSD software, may combine these functions with planning and mobile execution.
Common capabilities include:
- Vehicle inventory: record stock loaded, delivered, returned or brought back unsold.
- Invoicing and payment: document the transaction and record collections where payment is due at the visit.
- Proof of delivery: capture the recipient’s acknowledgment and relevant delivery details.
- Route planning: organize visits and delivery work.
- Offline operation: let field staff continue supported tasks without a connection, then synchronize records.
- Settlement: reconcile the route’s stock movements, transactions and collections.
- ERP integration: exchange customer, product, pricing and transaction data with back-office systems.
SAP’s route-accounting documentation explains the posting of documented tour activities to complete settlement. The precise workflow and mobile capabilities depend on the implementation.
Some products also cover buyer self-service. Pepperi’s published capabilities, for example, include ecommerce, rep ordering and route accounting within one platform. Check what your existing system already supports before you add another application.
The evaluation therefore reaches beyond the driver’s screen. Can a buyer use contract prices? Can the rep see that order? Where is it accepted, allocated and invoiced? Agree which system owns each step, particularly when data passes between vendors: the ordering channel, the route system or your distribution ERP software.
Where Online Ordering Fits Next to the Route
Online ordering fits where an outlet needs to buy between visits, a rep needs to assist that purchase or a brand needs visibility into orders fulfilled by distributors. It works best when buyers and reps share the appropriate account information and accepted orders reach the existing fulfillment process.
An outlet needs a top-up between visits
Consider a restaurant preparing for a busy weekend. The buyer starts from previous purchases or reorder templates, adjusts quantities and requests delivery. The useful confirmation explains what has been accepted and when it can arrive. A checkout confirmation alone cannot promise space on a truck.
De Klok Dranken’s customers, including restaurants, cinemas, caterers and sports clubs, can order through its self-service portal or, if they use restaurant purchasing-management systems, straight from that software via direct integrations. This lets buyers handle replenishment within the tools they already use, without requiring every purchase to begin with a sales call. For an outlet reordering familiar products, that can reduce the back-and-forth involved in routine purchasing. Reps can still help with product selection, promotions or unusual requests, while customers have a way to submit straightforward orders between conversations.
The rep helps the outlet place an order
A buyer may still prefer to call. The rep needs to work within that customer’s account, with its permitted assortment and account-specific pricing. Otherwise, the convenience of assisted ordering can end in an invoice dispute.
Ordering on behalf of an outlet lets authorized staff assist the buyer through a controlled session. Access and responsibility should remain clear; sharing the buyer’s password is unnecessary.
The rep prepares for the next visit
An order should inform the next conversation, whichever channel it came through. If the outlet has already replenished its regular lines, the rep can discuss a product trial, a display or an unresolved return instead of reconstructing the order over the phone.
A workspace for sales reps provides access to their assigned customers and the orders each rep has placed for them; shared sales materials are available by role.
The brand needs to understand outlet demand
HEINEKEN, a Virto Commerce customer, faced limited visibility into the small independent grocers served by its distributors. Connecting the ordering platform with distributor ERP systems for inventory, pricing and orders gives the brand a clearer view of outlet purchasing while keeping distributors involved in fulfillment. Orders placed through the platform can help reveal which products individual outlets buy and how their purchasing changes over time, giving the brand more information to guide account support and sales activity.
That visibility depends on which distributors and outlets use the connected channel. Purchases made elsewhere will not automatically appear, and access permissions determine who can see the captured orders. Consistent customer identifiers are also needed to connect those orders to the right outlets.
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Route and fulfillment systems
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Online ordering channel
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Vehicle loading and stock reconciliation.
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Customer catalogs, reorder templates and requested quantities.
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Routing, dispatch and delivery execution.
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Delivery options and order status supplied by connected systems.
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On-site invoicing, collections and driver settlement.
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Account prices and purchasing terms drawn from agreed sources.
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Physical returns and delivery adjustments.
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Order history and relevant updates made available to buyers and reps.
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Fig. Route responsibilities and online ordering responsibilities.
One software suite or several connected systems can handle these responsibilities. Outlets can place orders online while the ERP continues to manage pricing and inventory data.
How Virto Commerce Fits
Virto Commerce provides the B2B ordering channel; routing, vehicle inventory, proof of delivery and driver settlement remain outside its scope. Our platform connects buyer self-service and assisted ordering with the ERP and route systems a business uses: account prices and inventory come from those systems, and accepted orders go back to them for fulfillment and accounting.
For direct store delivery businesses, that means an outlet can order independently while its rep retains access to the account and can assist with purchases. Our team or an implementation partner configures prices, customer access and order handoffs around the commercial operation; we have delivered integrations with hundreds of enterprise systems.
HEINEKEN’s B2B ordering platform shows the scale this approach can reach. Within two years of launch, it accounted for 30% of operating-company (OpCo) revenue, while its global user base exceeded 370,000. Virto Commerce built HEINEKEN’s Digital Order Transfer (DOT) system, launched in 2018, to connect distributors, sales reps and outlets through a shared ordering environment.
De Klok Dranken achieved more than 80% digital adoption, with over 4,000 clients on the platform. The company replaced Adobe Commerce (Magento) while retaining SAP ERP, introducing a new customer ordering experience connected to its existing back-office system.
Common Mistakes When Adding Online Ordering to DSD
The most consequential mistakes occur where the new channel meets an existing responsibility: accepting an order, applying a price, preparing a load or recording a return. A portal can appear to work while leaving colleagues to repair those handoffs manually. Testing needs to follow an order through delivery and settlement.
- Treating checkout as a delivery commitment. An order submitted after cutoff may need a later run. The buyer should see that constraint before relying on the requested date.
- Allowing competing price records. A portal price, rep quote and invoice can diverge if updates reach systems at different times. The business needs an agreed pricing source and a process for exceptions.
- Launching without the reps. A sales team asked to promote a channel it cannot see or explain has little reason to trust it. Customer ownership and incentive rules need to be clear.
- Assuming every participant sees every order. A brand, distributor and rep may have different permissions or disconnected records. Visibility should be tested for each role.
- Leaving adjustments on paper. A substitution or collected return changes what the customer received or owes. That information needs to reach the relevant order and financial records.
In a Reddit thread, Frito-Lay route workers describe excess backstock and friction between ordering systems. Their accounts are anecdotal, but they illustrate why field feedback belongs in testing. A successful demonstration includes the exceptions as well as the completed checkout.
Before Introducing Online Ordering
Before launch, the business needs a shared answer to what happens after an outlet submits an order. The checks should cover customer expectations, rep involvement and the handoff to fulfillment, including situations where the requested goods or delivery cannot be supplied exactly as entered.
- Do accepted online orders reach picking and vehicle loading before the relevant cutoff?
- Do the buyer, rep and invoicing system apply the same agreed pricing rules?
- Can the outlet distinguish a submitted request from an accepted order and confirmed delivery?
- Can the rep see the relevant customer orders and assist within the correct permissions?
- Are account responsibility, distributor participation and sales incentives understood?
- Do substitutions, shortages and returns reach the appropriate customer and financial records?
- Is someone responsible for resolving orders that fail to pass between systems?
For a business retaining direct store delivery, the aim is to let an outlet buy when it needs to, with dependable prices and a delivery promise the operation can keep. Reps should arrive informed; distributors should receive orders they can act on.
If you’re considering online ordering alongside your delivery routes, explore our B2B ecommerce for FMCG and beverage distributors. For a closer look at helping teams adopt new ways of working, watch our recorded conversation with HEINEKEN.
FAQs
With direct delivery, the supplier or distributor delivers to the outlet. With warehouse delivery, goods first enter the retailer’s distribution center for onward distribution. Merchandising and returns responsibilities may also differ, but they follow the service agreement rather than a universal rule about either model.
Presell captures a customer’s order ahead of a later delivery, allowing it to inform fulfillment preparation. Van sales creates the sale during a visit using goods already on the vehicle. A distributor can combine presold deliveries with additional sales from speculative stock on the same route.
They need to establish whether the existing product supports customer self-service with the required prices, assortment and delivery rules. Some suites already do. Where that capability is missing or unsuitable, a connected portal can provide it while the established system continues handling route transactions.
Yes, where the ordering platform supports authorized assisted purchasing. The rep should work with the customer’s permitted products and applicable prices, and the record should identify who placed the order. Access controls allow assistance without passing the buyer’s credentials between colleagues or outside parties.
Beverages, snacks, bread and other frequently replenished bakery products are established examples. The model can also serve other categories where regular visits support availability or merchandising. Product category alone does not decide the delivery method: a supplier may use different arrangements across customers and markets.
