To properly estimate project costs, metal distributors and steel service centers must consider numerous variables, including raw materials, labor, utilities, and equipment depreciation. It’s a difficult process made even more problematic by the use of disparate systems. There is a solution, though, and in addition to simplifying the process, it can also greatly improve costing accuracy and protect your bottom line.
Transition to an Integrated Solution
Every system has its place and every system plays a unique role, but relying on disparate systems creates a disconnect and needlessly complicates the costing process. Getting the information you need from multiple systems is time-consuming, and the more systems you use, the more error-prone the process becomes.
Integration is key, and that’s why many successful metal distributors and steel service centers use specialized enterprise resource planning (ERP) solutions like RealSTEEL™.
An ERP solution integrates all of your business software into one. There are no more disconnected departments, no need to pull data from various systems, and definitely no needless complications. Everyone sings from the same hymn sheet, and as all data is displayed in real-time, you can track changing costs throughout the entire production process.
Here are a few of the ways an ERP system can help you track costs and keep profit margins high:
Centralized Data and Real-Time Tracking
All data feeds into the same system, creating a centralized and reliable database spanning everything from sales to production. Real-time tracking captures all relevant costs and updates as the job progresses, so production managers can monitor its progress and make sure the costs align with the budget.
Labor Management
ERP integrations can track all employee hours and connect them directly to payroll and accounting, showing you exactly how long your employees are working and how much it’s costing you.
Automation
With help from advanced AI algorithms, ERP systems are constantly learning about your business and can assume control of many tasks that previously required endless labor hours, while also streamlining production and automatically assigning labor. In addition to reducing labor expenses, automation also lowers the risk of human error.
Detailed Reporting
Utilize various reporting features to get instant visibility on key processes and departments, whether you’re checking the profit margins on particular lines or comparing revenue to total machine hours.
Scalable Solutions
You don’t need to operate a huge company to afford or benefit from ERP solutions. RealSTEEL™ is cloud-based, affordable, and completely scalable—get what you need now and add more integrations as your business grows and your needs increase.
The Importance of Accurate Job Costing
Metal distributors often work on very fine profit margins, which means they’re always one mistake, oversight, or bottleneck away from a financial disaster. Such is the case with job costing—it’s difficult to collect the right data and make an accurate prediction, and a mistake can be incredibly costly.
A notable difference between the estimated cost and the actual cost could decrease those already slim profit margins, harm customer relations, and heighten tension between management and project teams.
What’s more, if you can’t accurately estimate project costs, you may have limited knowledge of the company’s overall profitability.
Improve Your Job Costing with RealSTEEL™
RealSTEEL™ is a specialized ERP solution tailor-made for the steel and metal distribution sector. It contains everything your business needs to streamline production, improve accuracy, lower costs, and increase your profit margin.
Contact us today to see RealSTEEL™ in action and discover how our advanced steel optimization software can meet all of your software needs.
