Has the time come for a new construction accounting system?
Most construction businesses select a basic accounting software program when they first launch operations. At that point, it is a good choice – affordable, and easy to set up and use. And the software may even have limited functionality specifically designed for the industry. But there comes a time in the lifecycle of every growing contractor and developer when that “standard” accounting product is simply not enough – a time when a full Enterprise Resource Planning platform (ERP) makes sense.
Here are 10 common signs that your business is ready for a full ERP system.
1. Your company has become multiple entities.
There are many reasons why your corporate structure may need to become more complex. For example, a developer that manages its own properties may want to track projects as separate entities during construction and after build-out. Your business software should accommodate multiple entities while still providing an overall view of your business finances.
2. You need to manage customer relationships more closely.
A robust ERP system with a fully integrated customer resource management (CRM) platform should function as the single storehouse for all documents and agreements. This includes information about billing milestones, work order submittals, change orders and other compliance records that impact a project. Additionally, ERP integrates with email, so all related conversations and transmissions are in one shared repository.
3. You need greater control over production and inventory.
The capability to track your inventory across all locations is essential to timely delivery and efficient operations. Your software should give you the flexibility to choose your method – whether average cost, first in first out or last in first out – and to change over time. Your system should be intuitive as well, making proactive inventory replenishment suggestions.
4. You’re wasting time on duplicate data entry.
As companies mature, they often need to add more powerful payments processing, CRM, marketing automation and business analysis tools. A robust ERP system built on open application programming interface (API) standards enables dissimilar software applications to communicate with each other and dynamically share data (i.e. “talk” to each other), eliminating the need for duplicate entry.