Enterprise Resource Planning (ERP) is a management software that helps organizations integrate various business functions into one complete system. This helps with streamlining processes and information across the entire organization. ERP software supports various functions including finance, manufacturing, project management, accounting, and more!
ERP solutions have helped organizations overcome numerous business challenges by providing greater visibility on financial performance, integrating disparate software, making information more accessible, and more. In this blog post, we will be sharing the financial benefits of having an ERP solution.
Financial benefits generally come in one of two ways: reduced costs or improved revenues. At a high level, ERP solutions can help organizations reduce operational and administrative expenses. As we know, time is money. With an ERP solution, businesses can expect higher productivity levels through streamlined processes and automation capabilities. These facets can help save your staff a lot of time as well as reduce errors and the need for duplicate data entry. As one comprehensive system that can be used throughout your organization, it also reduces the need to operate different systems in each department. As a result, this reduces the burden on your IT team as there is less need for maintaining, upgrading, or purchasing different software for each department.
Take Advantage of Sales Opportunities
It’s also important to consider the revenues that can be reaped from an ERP solution. For one, ERP solutions promote the opportunities to cross or upsell. Especially when used in conjunction with a CRM, you can expect to have strong insights on your consumers; all customer interactions, whether it be purchases, phone calls, invoices, or more can be tracked with a CRM. An ERP can centralize such information and give your organization the insights to meet customer needs. With the abundance of collected data, as well as automotive capabilities, your sales team can also make more informed decisions and take advantage of opportunities to cross or up-sell, capturing revenues that were previously being missed.
Avoid Loss Sales
Furthermore, with an abundance of functionality, your organization can reduce any losses of sale due to unavailable products. You can expect to have enhanced visibility over your inventory and reduce inventory carrying costs or other costs by not keeping too much or too little inventory on-hand. This can also help ensure that you don’t have too much capital tied up in your inventory. Such capabilities and features of an ERP can ensure that your organization is equipped to best meet demand.
Improved Product Margins
With an ERP, you have access to an abundance of data and insights about your organization. It can help you identify bottlenecks and reduce costs to drive your margins up. These insights allow you to make more informed purchasing decisions and ultimately reduce costs in terms of materials and other inputs. Furthermore, an ERP solution can also help you plan or forecast for production needs, which can reduce unexpected downtime. Product margins may also be impacted by changes in costs from suppliers or distributors; these costs can include changes in pricing of factors like shipping or materials. An ERP can connect with systems of suppliers to receive updates on changes in costs to help give your organization a better idea of your product margins and where profits are being cut into.
Overall, there are many benefits that can be reaped from implementing an ERP solution at your organization. It is also salient to note the range of opportunities to help extend and expand the functionality of your ERP solution to meet the needs of your business through integrations and development tools. Interested in an ERP solution for your organization? Contact BAASS today.