An ERP (enterprise resource planning) is software used to manage and plan a company’s resources. It helps manage the inventory, sales, customers, and other elements of manufacturing. In addition, it maximizes the efficiency of an organization by automating various business processes.
The apparel manufacturing industry has grown exponentially in recent times. As a result, there is a rise in the demand for high-quality and innovative products. This has led to an increase in companies looking to enter this industry. An ERP is an excellent tool for newer companies looking to get their foot in the door and older companies who want to stay relevant.
What Are the Challenges in the Apparel Manufacturing Industry?
The apparel manufacturing industry is one of the more challenging industries to remain competitive in. This is for a variety of reasons.
Labor Costs: Labor costs have been rising for some time now, putting immense pressure on manufacturers since they need to pass these costs on to their customers. The higher labor cost is also driving many manufacturers out of business or into bankruptcy due to the inability to compete with other low-cost producers who utilize sweatshop labor or other unethical business practices.
Competition: Competition for market share has been intense between manufacturers who produce similar products. This has led to many manufacturers either closing down or going out of business due to being unable to keep up with their competition.
Volatility: With so much uncertainty in the apparel industry, it is difficult to plan for the future, and investment and growth can become risky.
Low-profit margins: Apparel manufacturing is a low-margin industry. This is because the cost of production inputs, such as fabric and thread, has increased in recent years, along with issues of inflation and supply chains. On the other hand, prices of apparel products have yet to increase enough to cover these high input costs. As a result, companies must make enough money on each item they sell to remain attractive to consumers while still making a profit.
5 Reasons Why Your Apparel Manufacturing Company Needs an ERP Solution
The future of the apparel manufacturing industry will be determined by how well it can meet customer needs while dealing with the issues of labor, profit margins, and competition.
Fortunately, implementing an ERP is a silver bullet for all these challenges.
An ERP can help with forecasting, inventory management, order processing, production planning, and shipping logistics. This centralized planning system can give your company the edge it needs.
Below are five reasons why your apparel manufacturing company needs an ERP solution
1) Improve operations efficiency
An ERP system will streamline your production process so that you can produce more products in less time. Without it, you or your employees have to spend valuable time on tasks such as manually entering orders or updating inventory records.
This grunt work is easily automated, freeing you and your employees for more technical or creative work. Having a computer do these tasks also reduces the number of careless errors caused by inattention.
2) Improve customer service
Whether you supply directly to consumers or source to other businesses, improved customer service will always help your bottom line.
Customers will appreciate how easy it is to get in touch with your company with streamlined production and delivery processes. Your stock will also be more accurate with a warehouse module that keeps information up to date.
3) Reduce costs
Running an ERP system will help you optimize your business’s operations in general, allowing you to reduce costs associated with things such as labor and raw materials.
With your employees working smarter and not harder, you will get a higher level of productivity and improve your margins.
4) Gain insights into supply chain operations
An ERP system will help you streamline supply chain logistics. With an ERP, you can forecast your need for raw materials. With enough data, an ERP will be able to predict jumps in demand based on a variety of factors.
This will allow you to get ahead and have more margin for error in your supply chains. Instead of responding to demand, you can anticipate it.
5) Make sure all your products are profitable
There are so many diverse costs associated with apparel manufacturing that finding your margin for a specific product can be challenging. Let alone making those decisions for your entire product line.
Predictions are only so accurate. Going through your product’s life from raw material to sale can be an eye-opener about what sells. This will allow you to cut off the ballast of products that aren’t pulling their weight and put more into the clothing that is.
How to Choose the Right Apparel ERP Software for You and Your Team
We have many other articles comparing the merits of various ERPs, but there are some things you should keep in mind while researching.
First, you need to understand your company’s needs and goals.
- Do you want to grow in size?
- What kind of inventory management system do you need?
- Do you want a full-fledged ERP system or just a simple one?
These are all questions that will help narrow down your choices.
Next, think about what type of technology your team prefers. For example, some people prefer using the cloud, while others like the familiarity of working with a desktop application.
The type of software may also be determined by how well it integrates with other systems in your company. For example, if your team is already using Shopify for ecommerce, then it would make sense to use an ERP software that integrates well with Shopify for inventory management purposes.
Your Business Needs an ERP
Manufacturing apparel is hard enough without managing a lot of different software. An ERP will allow you to consolidate all that information into a single location. That data will help you combat supply-chain management challenges, production costs, and employee productivity to give you an edge in the industry.
Acumatica ERP is a one stop solution for all your business management needs. It has industry-specific manufacturing (Acumatica Manufacturing ERP), service (Acumatica service management ERP), retail commerce (Acumatica retail commerce ERP), distribution (Acumatica Distribution ERP), and construction (Acumatica Construction ERP) tools.
Get a FREE Acumatica demo, we are Acumatica Cloud ERP Certified Partner!
If you need help choosing an ERP for your business, Confianz can help. Our team of experts can guide you through choosing and implementing an ERP that fills your needs. As a certified Acumatica Partner, Confianz employs a team of Acumatica implementation experts.
So call us today to get started!
