Reduce Revenue Leakages in Manufacturing Business

The term Revenue Leakage means preventable loss of revenue within a manufacturing concern. Usually manufacturers focus on core activities and components like Raw Materials, Parts, Production, etc., but generally the leakages are not directly from the production department as this is the most watched and managed department in most organizations. The leakages that are not directly associated with the actual production process consequently go unnoticed in many cases.

Unchecked leakages can devastate business profitability tremendously. These leaks are difficult to identify and many businesses are not even aware that they exist at all. A few of the concomitant areas that might cause the financial hemorrhage due to excessive money bleeding are:

Accounts & Finance

A frequent case witnessed in the Accounting and Finance department is lack of control over Account Receivables. Many companies maintain their Account Receivables on spreadsheets. They don’t have sufficient mechanisms to monitor and manage invoices on-time. Payment recovery becomes a tedious operation in such organizations. ?

Detailed and timely analysis of accounts receivable is key to understanding the company’s overall financial liquidity and stability. It’s very important for the companies to get rid of the spreadsheets and opt for a comprehensive Accounting & Finance solution like Oracle, SAP, AVEEROS, etc., which can help them streamline their finances and provide them complete financial visibility.

Equipment Maintenance

Manufacturing organizations rely heavily on machines so that they can fulfill the production demand. The downtime of a machine can cost greatly to the manufacturer therefore it is mandatory that every piece of equipment and machinery continuously operate in the desired manner. Lack of Planned and Preventive Maintenance can reduce the operational costs significantly. It’s always better to identify and resolve small issues before they grow into large problems.

A comprehensive ERP like AVEEROS can facilitate both Preventive and Breakdown Maintenance activities moreover it also guarantees compliance of the formal procedures as per the best manufacturing practices and ultimately it increases the overall organizational productivity.

Scrap Handling

The term scrap is associated with a scrapyard full of junk that may not have the visible value for the corporate but usually this is not the case. In many cases, scrap has significant value and this could be true for all manufacturing concerns because the yearly disposal can reach in millions. Lean operations management demands that manufacturers explore new innovative ways to increase profits by cutting costs and improving business processes. All the scraped items must be accounted for properly because as the saying goes ‘a penny saved is a penny earned’.

Categorizing, tracking and record keeping of scraped items isn't a simple task. A sturdy and capable system is required to manage manufacturing equipment scrap details. This is where AVEEROS Manufacturing ERP comes into play as it handles all these matters related to scraps in the extremely refined and streamlined format. AVEEROS Manufacturing ERP’s scrap management is very simple, yet powerful and anyone with a little computer knowledge can operate the system easily.

Tool Allocation

Every breakdown maintenance scenario is different and time is usually of essence because downtime has a direct impact on the profitability. When a machine breaks unexpectedly, the hurry combined with poor data could result in disaster. All Manufacturing companies have tools in their inventory but availability of the right tools at the correct moment can make all the difference.

A comprehensive ERP like AVEEROS can facilitate both Preventive and Breakdown maintenance activities moreover it also guarantees compliance of the formal procedures as per the manufacturing industry’s best practices. The AVEEROS platform also keeps complete track of tools allocation to resources thus all the tools inventory is completely accounted for.

Data Integration

Standalone software modules do collect data however companies running such standalone software literally have ‘Data, Data Everywhere’. But the actual goal is to develop understanding of the collected data from different departments and convert it into meaningful information for informed decision making. ?

An integrated ERP provides a real-time view of the business performance to management therefore selection of the correct ERP is incredibly important. Partial data can cost the corporate dearly because without operational transparency desired output cannot be achieved. Therefore it’s vital to understand the importance of centralized data source because it’s only with a unified database that you can track data, monitor operations and generate mission critical reporting for all major key processing areas (KPIs) of your business.

AVEEROS ERP platform provides a complete suite of integrated functional module e.g., Accounts & Finance Module, Sales Module, Supply Chain Module, , Production Module, Quality Module, Engineering Module, Payroll Module etc., All these modules are workflow based and are seamlessly integrated. All the data in AVEEROS is centrally available. The AVEEROS workflows are designed in such a way that they ensure reduced human errors and simplicity of use.

Conclusion:

• Major cause of Revenue leakage is inaccurate or incomplete data and faulty operating procedure.
• Workflow Automation and alignment of enterprise resource planning in the right direction can help you fulfill the operational gaps and eradicate revenue leakages.
• Manufacturing specific ERP software like AVEEROS can help your organization to get better control of both the processes and the data that lead to revenue leakage.

There are many other areas in a manufacturing corporation where leakages might be happening.

The AVEEROS functional consultants can help the manufacturing companies to:

1.??????Identify the leakage areas

2.??????Plug the leaks as quickly as possible

Contact the AVEEROS team for free consultation.

https://www.aveeros.com