9 Common Questions That Keep Manufacturing Owners Up At Night
For over 30 years, we have been working with manufacturing businesses of all sizes to help them run their businesses. They all have something in common: questions that keep them up at night. At this point, there isn’t a question we haven’t been asked, especially when it comes to:
- Ensuring profitability
- Managing inventory
- Preventing costly mistakes
- Meeting customer expectations
If these concerns keep you up at night, you’re not alone. Better yet, we have compiled the nine most haunting questions we receive and answers that can help you sleep better at night.
1. How can I create quotes when I don’t know our true labor and material costs?
The short answer is you can’t. To create accurate quotes that are both fair and provide your business the opportunity to make a profit, tracking actual labor and material costs is required.
We often find that manufacturers waste a lot of time tracking down information kept in different files, software applications, and even on different computers, none of which are integrated. So, when they pull their quotes together, they aren’t always using their latest labor and material cost figures.
It’s important to be more systematic and scientific when tracking labor and material quotes, or you risk losing bids and customers.
We understand you need to document costs so estimators have the most current figures at their fingertips. Your ability to respond quickly to a bid is the difference between winning and losing a job. Our advanced quote processing Enterprise Resource Planning (ERP) tools can help you succeed.
Sleep better at night with ERP software that lets you:
- Pull from part history, copy quotes into new orders, and create repeat quotes easily.
- Check inventory of parts, materials, and purchase history during the quoting process.
- Handle multiple quantities to manage alternate routing, material price breaks, and subcontract costs.
- Provide a quick or detailed quote for single-level and multi-level assemblies.
- Copy data automatically to a job without re-entering part information.
- Share a quote with a customer via email or fax without ever leaving your work environment.
- See and share your win rate with the team to understand which quotes turn into sales.
2. How can I get a full picture of my inventory so I stop wasting time and money?
Imagine having complete control over your inventory at all times. With Materials Requirements Planning (MRP), an integrated ERP module, you can ensure you always have the right standard and raw materials on hand at the right time. To avoid material shortages, you can conduct time-phased material planning based on purchase and work orders. Many of our customers have been able to use this to save up to 70% in added carrying costs.
“I used to struggle with existing WIP questions more than anything. I’d forget what was on order and when it was due. I had sticky notes everywhere. When we implemented ECI software, it made it easy to address WIP questions and also to make smart bulk-buying decisions and repeat purchases from my favorite vendors.”
End-to-end ERP solutions take the guesswork out of running your business and managing inventory. Additional capabilities include advanced calculators to ensure common materials stay on hand, lot tracking across multiple warehouses, material control to know what's on hand, and ordering to inventory requirements so you can maximize purchase price discounts and schedule delivery according to job requirements.
Sleep better at night with MRP software that lets you:
- Create automatic Requests for Quotes (RFQs) and Purchase Orders (POs) using time-phased material planning reports which are then mailed directly to your vendors.
- Increase throughput by ensuring material availability and knowing when to make bulk orders of your most commonly used materials.
- View material supply and demand information on one screen with drill-down capabilities.
- Purchase materials according to your job needs rather than guessing when to order the material.
- Prevent delays.
- View how your material costs have fluctuated over time with a comprehensive history of material you have purchased for stock or directly for jobs.
3. How can I avoid preventable mistakes?
As a business owner, we know your reputation is on the line if deliveries are late or products ship with mistakes. These preventable issues are typically caused by a lack of shop floor visibility.
Our ERP solutions provide instant visibility of job status and the issues that require immediate attention. With a click of the mouse, you get a complete snapshot of your business, including customer, production, vendor, and financial data. No more last-minute calls that cause you added pressure.
“Just when I thought things were running smoothly, something would change unexpectedly, and I’d get an angry call from a customer about a mistake that truly never should have happened. It’s my reputation on the line when a product ships with an error, or late, and we have been able to essentially eradicate those customer complaints by using the full functionality of our ERP solution, including the dashboard feature and alerts.”
Sleep better at night with Business Activity Monitoring (BAM) software that lets you:
- Set up automated alerts and get updates based on your settings.
- Notify when labor or material costs exceed an estimate.
- Collect information faster than with manual data entry and automatically validate to improve accuracy.
- Ensure the right people are doing the right things at the right time.
- Expand the capacity of your existing workforce dramatically.
4. Why does order entry take so long, and my staff make so many mistakes?
It’s simple: If you cannot easily view on-hand inventory in real-time, the order-entry process gets drawn out, and the margin of error increases. The order processing within our ERP solutions aligns with standard procedures used in manufacturing and provides immediate access to critical information at every step. It lets you easily generate different work orders and quickly respond to changing customer requests, reducing errors as you move directly from quotes to orders.
You can customize your inventory library, based on your shop’s business focus, giving you the flexibility to manage stock status. Just-in-time purchasing means you can order materials or services directly to a specific job, and then set the due date of the order to match the job schedule. You can also order materials according to inventory requirements to maximize purchase price discounts then schedule delivery according to job requirements. You’ll always know what inventory is on hand and where it is within your business.
Sleep better at night with ERP software that lets you:
- Move from quotes to orders with no additional steps or data entry required.
- Process quick-run jobs, complex assemblies, blanket orders with releases, and time and material jobs.
- Make changes to any job, including quantities and due dates, even when it’s already in process.
- Handle jobs that require routing options, such as varying run-time methods, overlapping operations, and efficiency projections.
- Notify purchasing of any part shortages.
- Choose from various format options for printing the shop traveler.
- Support unlimited text at the job level, individual routing level, and bill of material level.
5. How can I eliminate machine bottlenecks and keep employees and jobs on schedule?
Imagine this: It’s Friday afternoon and your shop floor team is winding down on the week’s activities while planning for next week’s jobs. As you are lulled into a feeling of control, it happens! A large surprise rush order comes in from your top customer. You aren’t sure if you can deliver.
If this scenario sounds familiar and sends a few chills up your spine, you’re not alone. Many small to medium-sized manufacturers struggle with how to handle unexpected spikes that dramatically affect personnel and machines.
With our ERP solutions, you get flexible scheduling that accounts for material availability, current workload, and actual job performance. A simple dashboard gives you insight into bottlenecks and capacity issues, and the ability to use all your work centers to full capacity. Your schedulers gain full visibility into all manufacturing operations so they can control job flow and ensure the required machines and operators are available to complete the work.
When customers request a potential ship date for an estimate, schedulers have the flexibility to use either finite or infinite scheduling by work center to compare the estimate to your current shop load on a “what-if” basis. Our system’s automated whiteboard, lets you schedule or reschedule jobs by dragging and dropping operations to different days or explores the impact of change before you actually change operations on the shop floor.
Sleep better at night with ERP software and scheduling capabilities that let you:
- Choose from finite or infinite scheduling by work center to manage capacity vs. load.
- Spot the load on individual work centers and make job decisions by machine, employee, or date and time.
- Minimize employee overtime and downtime, ensuring work/life balance.
- Tie your material requirements into the schedule and see the impact on the schedule immediately.
- Review the schedule impact of late outside service operations and see how jobs will be impacted.
- Create what-if scenarios to ensure capacity before committing to due dates.
- Provide the necessary work center dispatch list and production reporting tools, such as dispatch and foreman reports, to keep operations moving smoothly.
6. How can I get the price right every time?
Small- and medium-sized manufacturers often struggle to get the price right. If you work with smaller margins, you know they can be heavily impacted when materials and processing cost estimates are inaccurate.
“We have been finding that virtually all of our bids have now become competitive and that getting the price right on the first try is key to closing the deal. Our ERP solution has made it easier for us to ensure that even small jobs will be profitable because we go in with a price that we can live with and still make money.”
Another recent challenge is customers’ shift to smaller series but on a more frequent basis. This means that customer response must be faster, with less time to wonder if your price is accurate. Our ERP solution offers powerful cost analysis tools and reports for completed jobs and work-in-progress, so you know what every job costs and whether or not you have made money. Be confident in your ability to capture labor time correctly, log material costs back to each job, and, most importantly, know if you are making or losing money on a job.
Sleep better at night with ERP software capabilities that let you:
- Keep part history for repeat jobs.
- Use Cost Analysis tools to help requoting a part (or similar parts) and conduct a quick analysis of part cost and profitability trends.
- Project profitability on similar or repeating orders in the future.
- Keep costs in line for customers while ensuring the business stays healthy.
Now you can know how profitable each job is—at any time.
7. How can I avoid cost overruns?
Don’t get caught in cost overruns. Our ERP solutions’ Labor/Data Collection provides insight into shop floor activity so you know what each employee is working on, allowing you to monitor labor hours and manage performance and profitability precisely. Comparing labor and material estimates to actual costs in real-time allows you to adjust resources and minimize overruns. By knowing which employees are most efficient in various types of work, you can evaluate employee performance and manage efficiency.
Labor/Data Collection works the way your employees do. Employees can enter data directly using keyboards, barcode wands, computer monitors, and touch screens, thus reducing and eliminating data entry errors. Because mobile software can be installed on all devices, employees can move from work center to work center, collecting data on the shop floor without missing a beat.
Sleep better at night with ERP software that lets you:
- Manage work assignments based on material and operator availability and schedule employee work hours online.
- Choose options for breaks, overtime, or holiday pay.
- View drawings and other attachments online when and where you need the information.
- Reduce scrap and rework.
- Notify purchasing of any part shortages.
- Transfer time and attendance data automatically to the ERP system or QuickBooks® Payroll.
- Move completed parts to the finished goods inventory or between inventory locations.
- Eliminate hard-to-read handwritten shop cards and time tickets.
8. How can we increase customer confidence and ship on time?
Missed dates mean unhappy customers. Your customers need the confidence that you can meet their delivery dates for every job, every time. Our ERP solution shipping tools let you easily track delivery schedules and shipment history. You can generate shipping documents during job shipment and take advantage of built-in reports that help you track and improve on-time delivery rates. Customer satisfaction will soar.
Customer shipping requirements are as unique as the customer. When they are not met, customers don’t come back. The shipping tools allow you to easily keep track of delivery schedules and review shipment history in a timely manner. Quickly generate shipping documents, including pack lists and shipping labels, at the time of job shipment. Powerful reporting helps you keep track of your on-time delivery rate.
The ERP shipping features let you easily track all delivery schedules and review shipment history. Take advantage of the built-in reporting tools that help keep track of on-time delivery rates.
Sleep better at night with ERP software that lets you:
- Meet customer ship dates and track early or late shipments.
- Analyze delivery performance to improve on-time deliverables.
- Track shipments online.
- Manage multiple ship addresses for customers' operations and efficiency projections.
- Record shipping data to make smart decisions on future orders.
- Prepare packing lists and Bills of Lading.
- Track customer returns.
- Monitor upcoming deliveries so you ship on time.
- Track all movement of sub-contracted services to and from the vendor.
9. Which jobs are most profitable, and where am I losing money?
Small businesses can’t hope for job profitability—they have to count on it to survive and grow. Powerful cost analysis tools and reports for completed and work-in-progress jobs give you a clear picture of profitability at any point in the month. With our ERP solutions, you will know exactly what jobs cost so you can use your increased profits to grow your business.
ECI Software Solutions’ customer, Bryco Machine, had similar uncertainties in their job costs. After implementing a new ERP solution, they were able to turn their business around.
“In just three years profits have increased, sales have doubled, and productivity has skyrocketed.”
Because each job may yield different results due to staff, cost of the materials, or outside services, it’s critical to compare actuals to estimates on each job and isolate issues in progress so they are not repeated. Knowing where problems are before a job ends gives you powerful information to make smart decisions.
Our ERP solution’s cost reporting tools provide information to analyze shop performance. Profit margins and efficiencies are improved because you have the information readily available to estimate time and costs more accurately.
Sleep better at night with ERP software that lets you:
- Compare estimates vs. actuals on hours and costs for any job and at any point in the month.
- Adjust the sell price for repeat orders to increase profitability.
- Maintain part history information each time you run a specific part.
- Analyze profitability by customer.
- Know when to pass on a job that will cost you money.
- Bid competitively and profitably.
- Understand your overall costs and grow your business.
We work with thousands of manufacturers worldwide; many of us have been in your shoes. We understand your day-to-day challenges in running a successful business and want to help you make it easier and more profitable.