Using QuickBooks for manufacturers, while it may have been strategic in the beginning, may be doing more harm than good if you’re growing. Small and medium sized manufacturers flock to QuickBooks in their younger years because it is a tried and true accounting solution; but manufacturing goes beyond finances. As a growing manufacturer you need to be able to plan, procure, product, distribute, sell, handle complex transactions, measure up to standards, operate globally, collaborate, communicate, and more. To do all of that efficiently, you need to be in one system. While making the change to an ERP system may have been scary a few years ago, new technolgoy has made the change quote painless and more affordable than you might think! First thing’s first, why is QuickBooks not a sustainable solution for growing manufacturers?
Scalability: as a growing company you need to bring on additional employees and with QuickBooks, even the enterprise edition, you’re capped at the number of user licenses you have. If you are hiring more employees who need to access the system, this becomes a serious problem.
Point solution orientation: While QuickBooks is a solid financial system, it lacks the tools you need to track and manage business opportunities, support your growing client base, or manage important assets like accounts receivable for manufacturing. While you can use outside applications to manage what QuickBooks cannot, you’re only becoming more inefficient with each application you use while also risking data entry errors, unhappy customers, unhappy employees, forecasting issues, and more.
Lack of visibility: to make rapid and strategic decisions you need access to information beyond financials and you need real-time operations information across your organization. Because this isn’t an option in QuickBooks, manufacturers end up working in spreadsheets, a tedious and error-prone process. By the time the process is complete, your information will already be too old with how quickly things change in a manufacturing organization.
Fact: Various studies in the recent years have found that 88% of all spreadsheets have “significant” errors in them; usually human errors (click to tweet this shocking stat!)
Lack of industry specific capabilities: QuickBooks is a general solution that was designed to serve a variety of industries. While there are QB integration partners that can serve specific industries such as manufacturing, the system still lacks both basic and advanced best practices every manufacturer should follow to achieve growth goals. With QuickBooks the burden falls on you to create manual processes that have become “norms” in your industry. An ERP system with industry specific functionality will have these best practices built-in, so you can leverage them for growth without even needing to think about it.
Currency recording issues: having a global business is a possibility for manufacturers of all sizes, but QuickBooks wasn’t designed for this since it does not allow you to do business in multiple currencies. QuickBooks can handle U.S. and Canadian dollars, but for anything else there must be separate files to rack multi-currency transactions. This can quickly get complicated, cluttering up recordkeeping and making it hard to answer even the most basic questions.
A handful of years ago moving from QuickBooks to ERP would have been a painful and difficult decision, but that’s changed. Today, cloud-based, on-demand solutions have allowed small and medium sized manufacturers to easily make the move beyond QuickBooks to a more effective and complete business solution.
This white paper will walk you through six of the biggest mistakes you can make in your ERP decision process and show you how you can avert them.Learn More Here