Dinah McNav, the ERP Agony Aunt, answers the problems and pressures faced by businesses everywhere. This letter comes from the determined owner of a specialist food store who has ambitions to grow the business and expand into manufacturing. Her partner’s nervous about exploring different options, but the business needs a system to meet their demands.
I recently dropped a bombshell with my partner and suggested that we should both explore different options. This did not go down well, resulting in a lot of arguments about what we can do to make sure that we’re both happy. I still think that we should consider our options, but I am not sure I can persuade my partner that this will be good for our relationship.
Let me explain. We (my partner and I) opened a specialist food store about five years ago that stocked a wide range of imported foods from the continent. We also started to produce, on a small scale, some homemade pickles, jams and sauces, which went down well. In the years that followed we opened another 10 stores and saw a greater demand for our own products and less for the imported items. This meant an increase in production to meet demand.
Since we started, we have been using an entry level accounts solution to manage our accounts, but as the business has grown we are becoming more of a manufacturer, as well as a retailer. We now need to be able to automate all aspects of our business, rather than just our financials.
My ambition is for more growth in our manufacturing operation, developing a bigger range of products, selling to the larger retail stores and reaching a wider market. However, our current software is not robust enough to handle this type of change, hence the reason for looking at our options. Perhaps it’s time to look at getting an ERP system? My partner isn’t keen on the idea and thinks that we don’t need to upgrade, as the possible risk to the business is not worth taking.
Is he right?
Ann N Trepreneur
I’m always really interested and happy to hear about the success of a home-grown business, especially one with ambitious plans to grow. It is however, sad to hear that the software you’re using is preventing you from potentially achieving your plans for growth.
I’m extremely reassured to hear that you recognise what’s holding you back and the changes you need to make in order to achieve growth. You’re right that at this stage of your business, you should be looking at investing in a system that will manage all aspects of your business in one centralised database. As you mentioned, this is generally known as an ERP system.
You can find out more about what it is and what it can do for you on the ‘What is ERP’ page of the ERP Central website. Basically, it brings together functions such as finance, production, fulfilment, human resources, distribution, sales & marketing, and reporting with the aim of increasing efficiency and reducing costs.
ERP can be quite a big step for most companies, so I can understand why your partner prefers things the way they are and doesn’t want to change. I am sure he is fully aware of your current system’s shortcomings, but if you’ve been using the same system since starting the company, it’s more likely that he’s just become too accustomed to how things are.
A recent article, ‘Better the Devil you know, building a case for ERP’, highlights this, and it might be worth you reading it, as it poses some questions that you could ask your partner to put things into perspective; like, “What will happen if we do nothing and stick with the same software?”. When he realises that the answer to that question could actually pose more of a risk to the business than changing, you can move ahead with reviewing applications.
Now, there are a number of systems on the market but if you are looking for a solution that’s affordable, scalable and user-friendly, I would suggest you consider Microsoft Dynamics NAV.
NAV has been designed specifically for businesses like yours that have outgrown their existing software and it can offer all of the features and functionality you need to run your business. What’s more, for an ERP system it’s more affordable than you might think.
I hope that’s helped you get out of the ‘pickle’ you’ve found yourself in, and I hope you can ‘preserve’ the business without getting into too many ‘jams’.
Sorry, couldn’t resist it.
Dinah McNav, ERP Agony Aunt
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