As a business grows, it's critical that the systems supporting it are capable of supporting that growth. Using dated manual processes, Excel files, or archaic systems to run a business will quickly catch up to any business owner during periods of growth. It can even go as far as hindering growth due to its inaccuracies and inefficiencies.
In this blog post, we explain some of the features to keep an eye out for when choosing a capable ERP system to support your growing business.
As the business experiences periods of growth, owners must act quickly to ensure the surrounding systems in place are ready. One of the largest bottlenecks is accounts payable (AP) and accounts receivable (AR) automation. Far too often businesses still issue payments to vendors by manually writing checks and processing customer invoices manually as well.
Not to mention, the financial reports are likely manually generated as well, or a smaller bookkeeping system is utilized. As vendor and customer numbers rise, more locations open, larger warehouses are utilized, etc., these methods simply will not work out in the long run.
By removing the tedious tasks of AP and AR from staff member's plates with an ERP system like NetSuite, business owners can enjoy these benefits:
- Streamlined processes: Reducing the time spent on processing paperwork and payments creates an all-around more efficient workflow.
- Improved cash flow: With faster invoicing comes faster customer payments. These faster payments will lead to an improved cash flow for a business and help decrease the "day's sales outstanding" metrics.
- Reduced costs: Paying less in labor costs and overhead that comes with automating the AR process, and other processes across a business, will save companies money in the long run.
- Increased accuracy: Removing manual human input from the equation greatly reduces the chance of inaccurate and inconsistent data.
- Enhanced reporting: NetSuite's AR dashboards provide real-time data related to the status of customer payments and assist with tracking AR aging. This will help prevent past-due invoices, duplicate payments, and more.
- Higher confidence: Business owners can be confident in the AP, AR, and reporting outputs of their ERP system.
Inventory management is another area in which the right ERP system should be able to handle, no matter the size. Utilizing basic business software, Excel, or even manual pen/paper entries to keep track of inventory will quickly be outgrown and eventually start causing setbacks for a company when it comes to inventory.
Switching to a centralized system, like NetSuite, grants everyone from the sales and accounting departments to the warehouse, access to real-time data. At the end of the day, multiple departments within a company have their hand in the inventory. Simpler software and manual inventory tracking are restrictive and do not allow for the level of insight needed to be able to grow.
Integrating software like NetSuite among the different systems within a company will help prevent possible stockouts by providing supply chain insights, demand predictions, and help increase fulfillment speeds. An inventory control system that is integrated with the Customer Relationship Management (CRM) system can help to identify how stockouts are impacting customer satisfaction and customer loyalty. Finally, an inventory control system that is integrated with a financial application can go a long way in answering questions like how much stockouts are costing by measuring customer lifetime value, the cost of each item, and the responsiveness of the supply chain.
Now, these are just some of the areas that an ERP system like NetSuite can assist with when it comes to a growing business. However, there is so much more that it can do. To learn more about switching over to NetSuite, the team at AccountingDepartment.com can assist you. Our highly trained team of professional accounting specialists is here to serve all of your bookkeeping, controller, and advisory needs.