The Institute for Supply Management had some good news for business owners in the manufacturing sector recently. The overall economy is posting its fourth consecutive month of growth, according to the results of the latest Institute for Supply Management’s Report on Business. If you own or manage a manufacturing business but have not upgraded to production management software yet, is now the right time to take this step? We think there are some indications that now is a good time to make a move.
Do you need to put production management software in place without delay? Taking the next step is easy. Contact us online or call (330) 645-9959 to make an appointment with a Scanco Solutions Expert now
Purchasing Managers Index Showing Positive Results
The August PMI (Purchasing Managers Index) registered 56%. This figure was 1.8 % higher than the July rate (54.2%). This result indicated that economic activity in the US is continuing to gain momentum after a contraction during April ended 131 consecutive months of growth.
If you are not familiar with the PMI, it is meant to provide an indication of the health of the manufacturing sector. The PMI is based on five factors:
- (The) Employment Environment
- Inventory Levels
- New Orders
- Supplier Deliveries
The Employment Environment. According to the Index, the Employment Environment for the August Index was 46.4%, representing a 2.1% higher rate than July when the figure was 44.3%. A figure of 50% or above on the PMI indicates the manufacturing sector is expanding. If the numbers slide below 50%, it means the sector is contracting.
Inventory Levels. This segment of the PMI is contracting. In August, we saw the Index drop to 38.1% from the July level of 41.6%. This rate is considered “Too Low.”
New Orders. In contrast, the news for New Orders was much more positive. The numbers jumped from 61.5% in July to 67.6% in August, a difference of 6.1%.
Production. This indicator was also moving in a positive direction. In August, the number hit 63.3%, up a full 1.2% over July’s figure of 62.1%.
Supplier Deliveries. The rate for Supplier Deliveries is still at a positive level. It stood at 58.2% in August, representing a 2.4% increase over the July figure of 55.8%.
Overall, the Manufacturing Sector and the Economy are expected to continue to grow, which is excellent news.
Advantages of Production Management Software
Now that you know conditions for manufacturers are looking quite positive, let’s consider the advantages upgrading to production software can bring to your business.
- The software gives you better control over the quality of the products you are manufacturing.
It allows for more complete tracking of raw materials right up to the finished product stage. Depending on what you are producing, you have the option of tracking raw materials by expiry dates, lot numbers, or the date received (First In, First Out).
- It allows you to get a firm handle on the money aspects of running your manufacturing business.
Making products for customers is only one part of what your company does. Your sales representatives have to generate orders. You need to ensure you have enough materials on hand to manufacture the requested items. When completed, the orders need to be shipped to the waiting customers. You need to be paid so you can meet your payroll, along with your other expenses related to running the business.
The software gives you the tools you need to get an overall grasp of how money is being managed within the company. It can analyze areas where the finances are being managed well and point out any areas where improvements can be made. You will be able to use this valuable tool to prepare reports showing you exactly where you need to focus your attention most.
- Production management software gives you an edge when managing the warehouse.
When the warehouse is being managed efficiently, it allows you to make better decisions about inventory levels. The supply will be more in line with demand from customer orders. You will have fewer overstocks of inventory as well as fewer times when you have orders that need to wait due to out-of-stock items.
It also becomes easier to manage your warehouse workers. They can be deployed to areas in the warehouse where their skills and abilities will do the most good during their shift.
When to Upgrade to Production Management Software
If you have been thinking about upgrading your business to include production management software, there is no better time than the present. Based on the results you have just read from the Purchasing Managers’ Index, it is easy to see that manufacturing is expected to continue to expand in the US.
Rather than trying to navigate a business climate that will get even busier over time without this powerful modern tool that your competition is likely already using to streamline their business operations, now is the perfect time to introduce production management software to your team.
Sage Production Management From Scanco
Sage Production Management gives make-to-stock manufacturers what they need to achieve transparency throughout their full production process. This software option is customizable to meet your needs, with several modules you can choose to set up the right solution for your business.
Inventory Requirements Planning. Do you find that keeping up with inventory is an area that could use some improvement? It’s no problem. Just ask for Sage Inventory Requirements Planning (IRP) to be added to your virtual “basket” of software features. It links sales order data with your warehouse process data so your team will be alerted when your stock is getting low. Your team will be notified when orders need to be placed, before it gets to the point it becomes problematic for your business.
Inventory Transactions Updated in Real-Time. The remaining quantities in the warehouse are updated and materials are issued to a specific work order as jobs come in. This is the best way to keep your stock organized. Once certain materials have been “removed” from inventory, they cannot be assigned to another job by the software.
New Work Orders from Multiple Sources. We know the business world is moving rapidly and your company needs to be free to accept work orders from more than one source. With Sage Production Management, your team has the flexibility to receive new work orders from open work orders, historical work orders, templates, and manual inputs. The software keeps a record of all of them for future reference.
Purchase orders can be completed quickly and easily, often with a single click. The best feature that Sage Production Management brings to the table is that it can be completely customized to meet the needs of your business. It’s also scalable, which means it will grow along with your manufacturing company.
Learn More About Sage Production Management Software
To find out more about Sage Production Management software and how it can be customized to suit your business’ needs, including user-defined tables and fields, custom scripting, and more, all you need to do is contact us online. You can also call us at 330-645-9959 to schedule your appointment with a Scanco Solutions Expert right away.