Enterprise Resource Planning (ERP) Systems & Usage

Consistency plays a fundamental role in the efficiency of a business & before I get into any information regarding Quality Management Systems, Materials Control or branding, I thought it would be important to explain ERPs and how they can benefit your business from start up to a full scale international operation.

'Proper Planning Prevents Poor Performance'

ERP stands for Enterprise Resource Planning and ERP systems are used by Enterprises (businesses) to efficiently connect the processes of the business. These processes include, but are not limited to; purchasing, customer relations (CRM) management, sales (Point Of Sale or Online/eCommerce), finance, distribution and warehousing. Whatever you are doing, whether selling products or services to either consumers or businesses (or both), the small investment into a decent ERP can massively enhance your companies sales reach & capability & I will explain a little more into it below.

ERP Systems are software suites that have been designed in modular sections around the necessities of a business. When the COVID-SARS-2 Pandemic hit, I immediately recognised the entities in my local region who had a poor ERP system in place, because they had no online facility to order their materials & government rules denied them from opening their stores to the public, which their business relied on heavily for sales. Albeit, most stores did allow for orders to be placed over the telephone, but if I know human nature, this seems like hard work & they aren't guaranteed to get what they envision they will.

Most ERP systems work the same from the get-go.

1 - There will be a facility to set up your company details & input branding data

2 - Areas to add Ts & Cs to the various forms you require to use.

3 - Materials Set Up - essentially a stock management system, where you can add the data for the materials you sell, set up your various sites/warehouses etc & also set up individual locations within the sites, such as shelving locations.

4 - Customer Set Up - If you have an existing customer database on excel, you can import this data into an ERP System, so that quotes & orders can be created easily.

5 - Supplier Set Up - Again, if you already have an existing list of suppliers, they can easily be imported into a system to make it easier to send Request for Quotes or Purchase Orders as formal documents.

6 - eCommerce - this is so important to get your business into the 21st Century. I mentioned earlier that when COVID hit, I could see which businesses were going to struggle with the consumer market & they were the businesses that weren't set up for online sales.

7 - Finance management & reporting - most systems that have been updated regularly by the provider, allow your businesses activities to be linked to financial platforms such as Xero or Sage, which can save you a lot of time regarding the correct management of your business finances. But more than that, they can provide intelligent reports that help you stay on top of your business forecasting by showing you which products are selling more often than others, they allow you to see what is running low in stock to prevent downtime or long delivery times to customers for items that are in demand. One of the greatest features is knowing what stock isn't selling well & knowing how much your inventory is worth, this is particularly important for your redundant stock as it may help provide a broader image into why your items aren't selling that would otherwise be overlooked.

8 - Purchasing requests and orders - this module is very important for saving time & money. Many ERPs allow for you to create purchase request for quotes which can be emailed to your supplier from the system & for return quotes to be saved for future reference, whether you've made a commercial decision not to invest at the time or because your business found better prices elsewhere, saved quotes can help you out when you've exhausted all of your main suppliers availability. Purchase orders keep things professional, written email orders or phone orders aren't efficiently protecting you against items arriving as described. This isn't the only reason for using them, however with an effective ERP, the order will then be track able & likely follow into other processes within the system.

9- POS & eCommerce sales - some businesses sell items in various ways. Point of Sale is the most common for storefronts. eCommerce/online stores are the most common nowadays which is putting a lot of strain onto stores, footfall is thinning out because consumers are much more likely to want to buy an item online in the comfort of their own home than travel to a shop to find out if they have it & view what is available. A lot of well routed ERPs can manage both sales types simultaneously, they tend to be synchronised & also keep you alerted to low stock levels, again taking the mind power out of your operation & automating efficiency.

There are many ERP systems to choose from, which can be a headache you don't want when first setting up a business & if you already have your business up & running, implementing a new one can present a costly time factor. However, whatever stage you're at, I highly recommend finding the right solution for your business & getting it in place as fast as possible. It's easy to lean towards the first one you find, but finding the right one could increase your monthly sales by well over 100%. Do your research & make sure the one you find will work well with your business type & will grow with it too.

To conclude going back to my first comment, proper planning prevents poor performance, consistency is key, 'quality' sells products & ERP systems can be a great way to take the repetitiveness out of the day to day running of your business, ensuring a quality service to your customers, giving you time to focus on product development & by saving you staff running costs that are expended with poor process efficiency.