Imagine a world where manufacturers could predict every customer need before an order comes in. They’d have the parts prepared, the engineers clocked in and someone on the finance team ready to answer any question. Deadlines would be less of a restriction, and equipment from international suppliers would be on its way to your warehouse before a buyer even requests an estimate. Such psychic ability doesn’t exist, but software comes close. A good enterprise resource planning software improves your forecasts and equips your company to better serve customers.
What to include
Proper ERP is built on a foundation of data, and manufacturers need a lot of it to see optimal results. Some of the best forecasting information comes from your clients themselves. Their needs become your needs, so you should avoid guessing and get information straight from the source. Develop a good relationship with your clients, then discuss their own forecasting expectations with them. Collaborate as often as possible – the ERP Software Blog suggested weekly or monthly updates – to keep track of changing requirements as you move throughout the year.
Collaborating with your suppliers is also beneficial. Keeping distributors updated will allow them to prepare for any incoming demands you’ll have. They can then share their own knowledge on market trends and changes and the availability of raw materials.
Still, the most prominent source of data is your own records. Every customer you’ve built for, every part you’ve ordered, every piece of equipment you’ve moved has been tracked and kept within your ERP system. Payroll records list hours worked and overtime, and physical inventory counts recorded your stock levels throughout the year. All of this information can be compared and used to indicate future demands.
How to use this information
Once you have this data at hand, use it to predict the needs of your customers during the coming months. Sort the data by season, location or product and identify any patterns. Then use these patterns to make educated guesses as to what your clients will request later on.
Data from your suppliers can give you a good indication as to when certain materials will be available. Including information such as changes in price, delivery times, weather reports and outlier events, like union strikes, ensures better estimates, ERP Focus said.
Manufacturers should also use these forecasts to predict costs and revenue when creating a budget. ERP software provides a solid hypothesis for the cost of future materials and how much money customers will pay for a completed project.
ERP Focus also suggested using predictions to schedule employees. The data you’ve collected gives you an idea as to how long a similar assignment will take. Thus, you can make sure you have an adequate number of workers on hand at all times. You’ll also know which employees have the knowledge and skills suited for the task. If you find your company doesn’t have enough staff, you can hire more or implement a new training program in preparation.
ERP software takes the guesswork out of determining client needs. By combining data from customers, suppliers and your own systems, your business can make the best predictions regarding future demands.
Learn more: Download the “Physical Inventory Count Dynamics NAV Module Data Sheet.”