You probably know that an ERP system can make your shop more efficient. However, did you know that it can also save your shop money? An ERP system can have a great impact on your bottom line by allowing you to eliminate work, work more quickly, and accurately quote and schedule.
Many shops that don’t have an ERP system use spreadsheets to manage their shops. One of the downsides of using spreadsheets is that information has to be input everywhere you need it, which may be in multiple spreadsheets. The more times you type a number into a system, the more chances there are for that number to be input incorrectly. Beyond accuracy concerns, whoever is doing all of this work can’t be doing what the shop is actually paying them to do. While they’re busy typing in the numbers, they can’t balance the books or create the schedule for example. That office worker may need to either get someone else to help them with their work, or they may need to work overtime. All of this extra work occurs because the spreadsheets need to be filled out.
With an ERP system, there’s no need for double entry. Once a number is in the system, it can be assessed for any necessary report. Now that your office worker doesn’t have to put in the same numbers over and over, they have more time to get their assigned jobs done. So, you save money by not having to pay overtime, not having to pay someone to fix any mistakes in the data, and by having your office staff finish more projects.
Work More Quickly
Shops that don’t use an ERP system have to do everything manually, which takes longer. An ERP system can accomplish things much more quickly, like creating a schedule, helping you save money. Once you tell your ERP system which jobs are due when the system can automatically create a schedule that will get all your jobs out on time. Instead of spending your time creating or checking a schedule, you can click a few buttons and have your ERP do all the legwork for you. A good ERP system can also help you keep in contact with your customers. You can set up the system to automatically email updates to your customers at various points throughout the process.
An ERP system helps you finish the same tasks in less time. This either frees you up to delegate some of these jobs to others in the office or it lets you get more done in a day. Either way, you will have more time for other things, like determining the direction of your shop. This extra time will let you quickly see if your shop is having problems, or if your shop is ready to expand. Either way, catching things like this early will ultimately make your shop more profitable.
Accurately Quote and Schedule
One of the first things to check when looking at your shop’s profits is how jobs are quoted. With an ERP system, you know exactly how much it costs to run any job, no matter what routing steps are needed. Having this security means that you’ll know every job is profitable. However, once you line up profitable jobs, you have to make sure they all make it out on time. Fortunately, ERP systems can also create a schedule that will ensure all of your jobs make their deadlines. If your shop needs to run overtime to make that happen, the schedule will also show that as well.
Once your shop is only running profitable jobs and getting all of them out on time, you might see your schedule has some buffer space in it. You could find that your shop is making the same or more money without having to spend as much time working. This buffer space means that if your best customer calls in with a rush job, you’re more likely to be able to fit it in, and it’s much easier to rearrange the schedule. With their higher margins, rush jobs are great for your bottom line, so fitting them in is a smart move.
Although a good ERP system does cost some money, it saves you money in so many aspects of your shop that you will come out ahead. It can eliminate some unnecessary work, allow you to work more quickly, and give your shop accurate quoting and scheduling. All these benefits combine to give your shop a stronger bottom line and position your shop for growth. Looking to find out more about ERP systems and how you can save money?