Enterprise Resource Planning (ERP) software is critical for efficient food manufacturing and for managing the entire supply chain of food companies, from purchasing to distribution.
The following are some of the most common outcomes of ERP systems:
- Productivity gains
- Profitability has improved
- Manufacturing and distribution times are cut in half
- Overall product quality has improved
ERP software allows companies to plan, improve, document, and consolidate the manufacturing and transportation of food products in a single management system, regardless of their size or whether they use a continuous or batch process.
ERP systems are suitable for medium and small businesses as well as large corporations. In fact, to compete effectively against major rivals, midsized and smaller businesses must employ every tool at their disposal to work smartly. Here are ten ways food-specific ERP system can help a food product manufacturing company improve its operations:
1. Improve the Organization’s Function Integration
Can you imagine working with a team where departments aren’t separated by watertight compartments or silos? In order to develop a successful food manufacturing system, effective communication between departments is essential. ERP systems can have a variety of effects on departments, such as
- Determining the availability of finished products from the manufacturing department and establishing discount policies
- The sales forecasts are updated, and the planning department creates a more accurate production plan
- The production department can keep track of progress and identify areas where equipment, labor, or materials can be used more efficiently
- To provide proper maintenance work, the project manager can recognize time and outage.
- The warehouse department will ensure that inventory levels of raw materials, semi-finished goods, and finished goods are maintained at proper levels
- The logistics department is in charge of ensuring that delivery schedules are adhered to. To ensure freshness and improve cash flow, the purchasing department can better manage when and how much material is procured
It is possible to manage bottlenecks, update seasonal volumes and trends, and plan future capacity expansions.
2. Update Business Variables More Accurately and in Real-Time
The ERP system stores material prices, delivery costs and times, and product formulas, to name a few variables, guaranteeing that changes to figures in one department are shared across the organization. Customers’ prices can be tracked, and actual costs, timely delivery, manufacturing times, and product compositions can all be compared. Organizations can focus on business strategy by computerizing tactical changes and profitability and production analysis.
3. Make the Sales Process More Efficient
The sales department can use a number of tools that can help it work more efficiently. ERP software packages can assist in the following ways:
- Quickly generate accurate quotations.
- Keep track of quotations and orders that have been delivered.
- Set prices by multiplying the total cost by the price increase.
- Send invoices in a timely and efficient manner.
4. Increase Production Efficiency
Machines and equipment transform raw materials into finished products in every food company. Another way how ERP can help companies build future business startegies is by assisting them in loading data on these components into the system, allowing them to define the manufacturing capacity per machine. It can also detect idle capacity and reallocate resources on the fly. It is possible to manage inefficiencies, update seasonal quantities and trends, and plan future capacity expansions.
5. Time and Inventory Levels Should be Optimized
Traditionally, food companies have attempted to solve a variety of inventory management issues using the ERP software, including:
- The warehouse’s inability to locate raw materials or ingredients
- Goods that have outlived their shelf life, whether finished or semi-finished.
- Stocked SKUs in excess
- Unnecessary materials are purchased “just in case.”
- Efforts to keep other departments informed about product availability are time-consuming.
ERP software eliminates these issues. It gives all functions with the appropriate permissions access to a single, reliable, and up-to-date source of data.
6. Enhance Food Product Traceability
ERP systems help to streamline the supply chain and ensure that food reaches customers and distributors in good condition. Recipes, quality control, compliance, and traceability are all managed by ERP software. The integrated system keeps track of manufacturing orders in real-time and makes shipments easy to identify.
Companies can use ERP software to buy what they need, when they need it, and combine factors of production on time. If the sales forecast changes, the system will estimate all of the organization’s dependent variables. Using an ERP has several advantages, including creating production orders and streamlining the picking list.