One question I hear frequently from our manufacturing clients is, “Do you think ERP software is worth it?”

Yes, investing in a new enterprise resource planning (ERP) software system can be expensive. For manufacturers currently using spreadsheets or small business software to handle their accounting needs, it can feel like a lot. Add to that the amount of time and resources devoted to moving to an ERP, and, well, it can leave you questioning whether it’s worth it or not.

So, the short answer is yes. I get where you are coming from. However, if you consider the possible return on your investment, you’ll find yourself weighing the pros and cons above and beyond the cost. And you’ll quickly realize that the investment in manufacturing ERP software can yield enormous benefits. There’s a definite return on investment in an ERP. Let’s take a closer look.

The ROI of ERP Software

Why do manufacturers implement ERP systems? A Panorama Consulting Group study found that among companies that performed an ROI analysis before purchasing their system:

• 83% were satisfied that the new ERP met their cost-benefit objectives
• 78% of respondents felt the ERP improved productivity
• 77% thought it removed silos
• 70% think that it enhances customer experience.

You can uncover your own reasons for upgrading to ERP software. Common benefits manufacturers receive from new ERP investments include:

• Better insight into inventory levels and enhanced inventory optimization
• Automations, including AI automations, to streamline invoicing and more
• Greater visibility into suppliers and supply chains
• Faster time to quote
• Improved visibility into finance, accounting, operations, and more.

Take a look at why you’re considering an ERP system. Have you outgrown your current small business accounting software? Many manufacturers start with general accounting packages but find that, as they grow, they need better visibility. Others stick with spreadsheets but find themselves spending way too much time managing spreadsheets and not actually gaining insights into the numbers.

The Full Cost of ERP Software.

There’s more to buying ERP software than the sticker price. I’m not trying to scare you, just trying to be realistic. We’d be happy to help you crunch the numbers and figure out your exact cost and ROI of investing in new ERP software.

Costs to implement new ERP software include:

• Software. Whether it's a one-time purchase or a monthly subscription, this is your starting point.
• Integration: If you already have systems in place, they need to communicate with your new ERP. This is called integration. Sometimes it’s easy, sometimes it’s not. PositiveVision can help you understand what’s involved and the possible costs.
• Customization: Try to avoid customization if you can. It adds an initial expense and, often, an additional maintenance expense. Purpose-built manufacturing ERPs should need little customization because they’re made for your industry.
• Data: The data in your existing spreadsheets or systems should be reviewed, deduped (c removed), cleaned, and updated. Then it needs to be moved (migrated) into the ERP.
• Training: Most vendors include training, but you should also factor in the time and cost of ongoing training. Training is rarely one-and-done. Your employees will need refreshers from time to time, and new employees will also need training in how to use the system.
• Maintenance: ERP systems are like cars - they need routine maintenance and tune-ups. Depending on what you buy, this may be included in the system (like updates), or it may be an added cost.

New ERP Software Supports a Growing Business

When we sit down to calculate the ROI from your ERP software, we look at how it impacts current and future opportunities. A new ERP system truly supports growth. It enhances your competitiveness in the market. It enables better and faster decision-making. And with added AI automations, often baked right into the software, you’ve got even more powerful ways to use data, manage operations, work with suppliers, and improve margins.

Case Study: Beckers USA

This is the story of how a new ERP helped a manufacturer’s competitiveness in the market.

Beckers Group USA, a manufacturer of paint solutions, came to PositiveVision through SYSPRO, which recommended us for their project. Their aging ERP needed replacing, and the new ERP desperately needed integration with other systems to provide a complete 360-degree view of their operations.

Beckers takes great pride in its exceptional customer service, which is one of its selling points. The newly updated and integrated ERP software enabled Beckers to continue its tradition of service excellence, landing new customers and building loyalty among its existing customer base. In terms of ERP investment and return, you might say, “Priceless!”

PositiveVision: Syspro and Sage 300 ERP Experts

PositiveVision provides comprehensive business management software solutions for small to mid-sized manufacturing and distribution companies. Since 2002, we have been dedicated to helping businesses streamline processes, reduce inefficiencies, and grow revenue by leveraging advanced technologies such as Syspro ERP, Sage 300 ERP, and various business intelligence applications. Our team of experts offers tailored support and exceptional customer service, ensuring that clients achieve their operational goals and maintain a competitive edge in their industries. Contact us for more information.

Robert Baran

Robert Baran is the founder and President of PositiveVision. He has worked in a variety of positions including system analyst, computer consultant and programmer, project manager, and division manager.