Chris Fisher, VP of EMEA, LBMH Division at ECI Software Solutions, discusses the importance of builders’ merchants investing in specialist technology in order to maintain strong performance and business continuity during turbulent times.
For builders’ merchants of all sizes, the past few years have been rocky, with Brexit and the COVID-19 pandemic causing major disruption to supply chains and working practices. At the start of this year, there was some encouraging industry recovery with ONS reporting that construction activity across the UK had returned to pre-pandemic levels, rebounding by +12.7%. But since February, the war in Ukraine has impacted the global economy, creating fresh uncertainty.
With these supply and demand issues continuing, and the availability of stock tightening, industry competition and prices are only set to increase. In fact, this year the cost of building materials rise by around 25%, creating problems for SMEs who have smaller cash reserves to fall back on.
Combatting supply chain issues
Staying ahead of supply chain issues is a key priority for builders’ merchants. However, this can feel like a daunting task for those reliant on manual or legacy systems. ERPs are designed to streamline the inventory and order management processes, allowing businesses to take advantage of real time stock and supply chain updates.
When properly implemented, ERPs will minimise the administrative time spent on trying to stay on top of supply chain disruption and chasing endless paper trails, allowing more time to be spent on crucial value-add activity — such as building client relations, seeking out new partnership opportunities and working on sales deals.
Behind the scenes, automatic stock replenishment can also save busy builders’ merchants time by tracking stock and jobs to manage future planning and, by using reports from previous years, analyse trends to pre-empt peaks and troughs in demand.
A fully integrated ERP system will not only replace and simplify the tracking procedures associated with stocking and selling hundreds of product lines, it will also reduce the chance of customers being able to order unavailable or out of stock items.
“ERPs will minimise the administrative time spent on trying to stay on top of supply chain disruption and chasing endless paper trails, allowing more time to be spent on crucial value-add activity — such as building client relations, seeking out new partnership opportunities and working on sales deals.”
Improving accuracy
When hard times hit, the first thing to be impacted is the bottom line, so implementing technology that can provide an accurate and up-to-date overview of the entire business is important. Specialist ERP systems remove the need for transferring information across multiple spreadsheets — a process susceptible to human error.
Similarly, manually collating data for reporting takes a great deal of time and precision to get right and can quickly snowball into logistical and stocking errors when done incorrectly — a costly mistake, both financially and reputationally, if orders are late or incorrect.
With the right system in place, reports can be generated instantaneously, allowing a busy builders’ merchant to monitor the status of a project. Specialised ERPs also allow for collaborating across teams, ensuring key metrics can be delivered to relevant departments in a timely and efficient manner.
Driving better customer service
When thinking about implementing new technology, alongside improving internal operating processes, all client facing businesses should consider: “what will work best for the customer?”
If a customer calls to get a summary of their account or requesting details of their last transaction, they’ll most likely be after a quick response. Gone are the days of putting people on hold to trawl through endless paper documents, dis-jointed spreadsheets, invoices or receipts to find these answers.
In the past, small scale operations might have struggled to find the resources or funds to manage unforeseen, large or complex orders. However, Cloud based ERP systems are fully scalable and able to expand as a business grows and order volume increases.
Finally, when unpredicted delays do occur, being able to provide customers with timely updates helps to negate stress as you can immediately assess the situation and formulate a plan, instead of having to dig through files to rework a solution.
Although a very resilient industry, at a time when many are looking to safeguard their business by driving more efficient and reliable ways of working, taking a step back to analyse what is productive — and what isn’t — is a good exercise to carry out. Should you decide to implement an ERP system, be sure to partner with a trusted expert that can ensure your business is set up to navigate choppy waters now and into the future.
