With the Bank of England responding to high inflation with interest rate increases, businesses large and small are feeling the strain. Soaring inflation has put pressure on the bottom line and companies are looking for ways to put themselves on a more secure financial footing. Building a robust digital backbone is critical. Having full visibility of cashflow through access to real-time data should now be a top priority, and there has never been a better time to embrace the powers of ERP. At NexSys we understand the challenges faced by our movers and makers and are always at hand to support smart decision-making with our comprehensive portfolio of solutions.
Inflation remained stubbornly high in September at 6.7% despite a concerted effort to keep it under control (although it does look set to improve slightly). This saw interest rates rise for an incredible 14 consecutive months. At 5.25%, the base rate is now at its highest since 2008 and many are predicting that rates will remain high for at least two years.
The cost of borrowing is forcing all types of businesses to reassess their finances. In the current global climate, the only thing that is certain is uncertainty. Getting a clear picture of financial performance and accessing reliable information to identify interventions that will improve the availability of cash is key to building resilience.
The power of ERP
For decades, SYSPRO has been evolving its solutions to meet the changing needs of its clients. As business leaders struggle to respond to a challenging fiscal landscape, its enhanced functionality can play an important role in helping future-proof operations.
The businesses we speak to face pressure from a multitude of sources. They have unique sets of circumstances and are all on different stages of their digital journey. Yet many are asking the same questions and wanting solutions to address the same sorts of issues:
1. How do I get insight into my cashflow?
You need to know the scale and nature of the problem before you start looking for solutions. Too many business leaders struggle to understand the true state of their finances. How much money do I have? What am I owed and where are the opportunities to free up more cash?
The real value of a centralised ERP system is the gift of visibility. Having a single and reliable source of truth removes the blinkers and shines a light into every nook and cranny of your operation.
SYSPRO Cash Book allows optimal cash management by providing system-wide bank reconciliation, as well as tracking information on cash inflows and outflows. This enables Cash flow forecasting, which means managers can view the company’s projected cash position into the future and use that insight for informed decision-making.
2. How can I access more cash?
The costs of servicing corporate bank loans can be hugely inhibitive. Many businesses that have borrowed at variable rates are already feeling the squeeze, and taking on more debt will be viewed as a last resort.
Companies that need access to more cash should start by looking at how it can be generated within their own operation. Do you have visibility of what your customers owe you and when it should be paid?
Many businesses are sitting on a lot of cash they are not aware of and don’t know how to free up. ERP solutions are designed to help. SYSPRO Accounts Receivables with its built-in credit management reports facilitates accurate invoice processing and ageing, timely statement delivery and revenue collection.
The Dunning System feature streamlines credit management by managing the distributing of periodic payment reminders for unpaid invoices. There is also potential to use AI to predict late payments, allowing you to find more effective ways of ensuring you get paid.
3. How do I improve profitability?
During tough economic times it is important to get the basics right to improve margins and support the bottom line. Embracing the digital era will make it far easier to get insight into your production process and find ways of driving efficiencies and boosting performance.
Access to real-time data will help identify opportunities to drive improvement. For instance, SYSPRO’s Manufacturing Operations Management (MOM) solution provides a complete manufacturing management model from planning and scheduling to tracking and analysing. MOM offers a unique level of delivery, cost, and quality control, allowing you to focus on improving productivity.
In addition, SYSPRO’s in-built variable pricing and promotion tools will help ensure you are charging the right amount at the right time. Having detailed reporting on sales and buying patterns means you can focus your attention on what is most profitable. Conversely, tracking credit histories will help manage risk and the impact of late payments.
4. How can I manage inventory more effectively?
Space is costly in any operation and ensuring you have enough of the right thing in the right place at the right time will have a major impact on profitability.
Together with Inventory Forecasting, Families and Groupings, and Requirements Planning, SYSPRO Inventory Optimization provides the tools and processes to optimize stock levels and reduce obsolescence.
With these enhanced capabilities, decision makers can get to grips with issues such as over- or under-stocking. They can improve the accuracy of stock taking and cycle counts and highlight opportunities to free up space and cash. This might be through discounting certain items, repurposing them, or even writing them off.
5. How can I reduce costs?
SYSPRO’s comprehensive portfolio of solutions not only identifies ways to improve profitability but gives the visibility needed to uncover cost saving opportunities. If you can drive costs down, there is less pressure on cashflow, and you can avoid having to increase your borrowing.
From interrogating production to tracking financial transactions, providing traceability for materials to shining a light on warehousing systems, ERP provides a helicopter view of your operation. In doing so, it highlights areas where you can reduce expenditure without compromising on customer satisfaction.
That might involve changing procedures to reduce energy consumption, improving quality control to minimise returns, or automating tasks to free up staff to do higher value work. At the time, SYSPRO can identify ways to reduce waste, or give you the information you need to renegotiate better rates with suppliers through competition. The possibilities are endless.
Times may be tough for many businesses dealing with the consequences of high inflation, but help is at hand. NexSys will support you at every stage of your digital journey, as a trusted partner providing solutions that put you back in control of your fate. Empower your staff with the insight and tools they need to work more effectively and help your operation weather the storm. Talk to us today about how we can help transform your business.