ERP Software Increases Profits

As technology advances in other areas of our lives, it makes more and more sense to get the benefits from technology in your shop. Some of you may already have an ERP system, but some of you may not. If you want to remain competitive, it is essential that you have the most up-to-date ERP system you can get. This will be the first installment in a series of blog posts to help you with what to consider when looking for a new ERP system. For this post, we’ll start by going over what ERP systems are capable of and some benefits you’ll want to consider for your shop.

Ballparks are for Baseball

In order to accurately estimate a product, you need to know how much time and materials go into making it. Otherwise, you’ll either bid too low and lose money on the job, or bid too high and not get the job. However, you don’t want to spend too much time on your estimates because you might not get the job, and then that would be wasted time. With an ERP system, you can quickly and accurately make an estimate or a quote and go from an estimate to a formal quote if needed. That way, you can be sure you’re setting a fair price for your shop and the customer, and you’re not wasting time if they choose to go with another shop. When searching for an ERP system, look for a system that will let you start with a summary quote and add detail later, copy information from existing quotes, and adjust profit margins at each quantity break. Once you’ve won a job, the next step is to schedule it in your shop. A good ERP system makes this simple.

Your Very Own Dry-Erase Marker

Scheduling is the life blood of any shop. A good ERP system will keep that blood flowing. It’s like having a physical white board and dry erase markers, but it’s much easier to change if you need to, and it stays up to date. If a customer calls in, you’ll be able to tell them where their job is from your computer, rather than having to run onto the shop floor and track it down. With data collection on the shop floor, you’ll have up to the minute information on where your jobs are and at the end you’ll know exactly how long the job took. You will want to make sure that an ERP system has multiple methods for data collection from manual entry to scanners to make sure your folks on the floor can keep everything as accurate as possible. In addition, when you win a quote for a job, your system can schedule it automatically for you and let you know when you need to start it. A good system will also tell you which jobs are going to be late. If you want to have a paperless shop floor, make sure the system you’re investigating will let you do that.

Your Shop in the Palm of Your Hand

In order to make the best decisions for your shop, you need to be able to access up-to-date information. Looking at all of the available data is overwhelming, so it is important that you can look at the big picture and manage by exception. From a big picture view, you should also be able to drill down to exactly what happened to cause a problem. It is also worth considering if you want to put your ERP system on the cloud. Using the cloud brings flexibility and the ability to see everything that’s happening in the shop from anywhere with an internet connection. Typically, either the ERP vendor or a third party who runs the cloud will have the resources to buy better virus protection than you will, so it is often more secure to use the cloud. However, some shops have security concerns that don’t allow them to store their information off-premise, so you will need to decide which option works better for you and make sure the ERP software you want meets that need.

Technology is advancing more and more quickly, meaning that ERP systems are becoming more sophisticated, and if your shop doesn’t have one, or if it’s out of date, you’ll be left in the dust. However, with so many options out there, you need to be sure you’re buying the right ERP system for your shop. Check back for the second installment in this series, which will discuss vetting your potential ERP software. If you want all of this advice in one document,download our buying guide.

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