Business Automation and Software Blog

Is Your Company Too Big for Its Manufacturing Accounting Software?

Posted by Linda Baran on Wed, Jun 19, 2024 @ 08:00 AM

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Replace Accounting Software That Can’t Keep Pace as Your Company Grows

Your business is in a good place. New customers are coming on board, the number of orders is up, and the manufacturing division is growing. These are exciting times, but expansion presents many challenges, too. As the operation scales up, you will likely need to consider upgrading your manufacturing accounting system.

6 Signs You Need to Upgrade or Replace Manufacturing Accounting Software

  1. You are still using many manual processes and Excel spreadsheets
  2. Your accounting team is spending tons of time completing manual tasks
  3. Certain advanced facets of manufacturing are impossible with your current systems, such as work order planning, scheduling, reporting, barcode inventory, COGS, etc.
  4. You lack visibility into your finances
  5. Inventory management is challenging and you either find yourself running out of material or overstocking your supplies, tying up cash. (Does this sound familiar: “How can we have so much inventory in the warehouse and yet we never have the right materials for production?”)
  6. Invoicing takes too long, slowing cash flow

If you are seeing a few of these signs, its time to seriously think about replacing your accounting software and moving toward an Enterprise Resource Planning (ERP) system. An ERP system will allow your business to integrate and manage many key business processes in real-time, increasing productivity and reducing redundancies. Upgrading to an ERP will unlock many benefits and ultimately allow you to move your business to the next level.

How ERPs Benefit Manufacturers

  • Company-Wide Visibility

An ERP allows for a holistic view of your operation. This enables you to review all available information to make informed decisions. With a thorough understanding of your business situation, you can make more strategic decisions. 

  • Real-Time Data Automation

With an ERP, you no longer tie up resources in manual accounting and data entry. System information is updated in real-time across the business. The same data can be transferred throughout multiple layers of the operation. Many costly mistakes are eliminated by reducing the need for multiple steps in data entry, saving you time and money.

  • Standardized Processes

An ERP forces a business to operate in a standard manner. The processes are clear and replicable and, as a result, you depend less on a single person and the anecdotal knowledge they have developed over years of work. When processes are standardized, they can be better optimized.

  • Centralized, Standardized Data

ERP software reaches almost every part of a business. Because of this, it helps you understand where inefficiencies occur across your value stream. The centralization and standardization of data is extremely valuable for cross-departmental collaboration.

With an ERP system in place, you will gain much better control over your supply chain. An ERP allows you to forecast demand, manage inventory levels, and improve procurement, resulting in the right inventory at the right time. Better control over your supply chain leads to better cash flow for the business and increased profitability.

  • Best Practices Finance Processes for Easier Compliance

ERP systems use best practice finance processes, which makes compliance easier. The data is secure and validated across your platform, and an ERP has many built-in financial reports that can be generated automatically. These features can save you a ton of time and hassle in meeting financial reporting requirements.

  • Scalability

With more growth, your operation will likely get more complex, and you dont want your software holding you back. A good ERP will facilitate the expansion of your business by adding functionality – new processes, new customers, or new products, for example. It will also be flexible enough to adapt to your changing needs as a business.

Things to Consider When Choosing an ERP

Once you’ve decided to implement an ERP solution, planning appropriately is key. Replace accounting software or upgrade your system with these guidelines:

Costs: Though the benefits are great, ERPs range widely in price. Be clear on the costs associated with an ERP purchase. The biggest variable here is consulting costs.

Company Resources: Like any major project, if your company and the ERP vendor do not commit the proper resources to an ERP implementation, it will struggle and potentially fail. Appoint an experienced project lead.

Employee Concerns: Your standard practices will be changing with the ERP. Are your employees open to this change, and is there a plan to proactively address their concerns?

Cloud or On-Premises Solution: You will need to determine if your network infrastructure can support the ERP or if you want to pursue a cloud architecture. Both have their advantages and drawbacks.

Choose a Vendor: The selection of a vendor is extremely important. Does the vendor have experience in your industry and with the challenges you face? Service and support will be crucial both early on and in the years to come, so a local vendor almost always has an advantage. Do not simply pick the cheapest option.

As the manufacturing side of your business increases, you will need to upgrade your manufacturing accounting systems to support the higher growth and replace your old accounting software. Once an ERP system is deployed, you can upgrade your entire business. It’s best to proceed carefully in consultation with affected employees to ensure success.

Download this whitepaper: Has Your Manufacturing Business Outgrown Its Accounting Software?

PositiveVision Is the Right Partner for Manufacturing Automation

PositiveVision has been serving the needs of manufacturers for over three decades. Our experts will gladly guide you through your ERP decision-making process to help you make an informed choice. Contact us today to speak to one of our product experts about a custom solution for your business. When you reach out, ask about our software training services for your team.

Linda Baran

Linda Baran

Linda Baran is in charge of the people side of PositiveVision. Linda’s background includes working in a variety of industries including investment, manufacturing, and information technology.

Topics: manufacturing accounting