{"id":3613,"date":"2019-09-17T10:33:36","date_gmt":"2019-09-17T10:33:36","guid":{"rendered":"https:\/\/www.mrpeasy.com\/blog\/?p=3613"},"modified":"2023-06-13T07:16:57","modified_gmt":"2023-06-13T07:16:57","slug":"food-manufacturing-streamlining-with-manufacturing-erp","status":"publish","type":"post","link":"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/","title":{"rendered":"Food Manufacturing Streamlining with Manufacturing ERP"},"content":{"rendered":"\n<p>The use of Enterprise Resource Planning (ERP) is an essential component in the management of food products manufacturing. <\/p>\n\n\n\n<!--more-->\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"500\" height=\"333\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Food-manufacturing-erp.jpg\" alt=\"Food-manufacturing-erp\" class=\"wp-image-3614\" srcset=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Food-manufacturing-erp.jpg 500w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Food-manufacturing-erp-300x200.jpg 300w\" sizes=\"auto, (max-width: 500px) 100vw, 500px\" \/><\/figure><\/div>\n\n\n\n<p><em>You can also listen to this article:<\/em><\/p>\n\n\n\n<iframe loading=\"lazy\" title=\"Food Manufacturing Streamlining with Manufacturing ERP\" referrerpolicy=\"no-referrer-when-downgrade\" height=\"122\" width=\"100%\" style=\"border: none;\" scrolling=\"no\" data-name=\"pb-iframe-player\" src=\"https:\/\/www.podbean.com\/media\/player\/pu4jt-d26e1b?from=pb6admin&amp;download=1&amp;version=1&amp;auto=0&amp;share=1&amp;download=1&amp;rtl=0&amp;fonts=Helvetica&amp;skin=1&amp;pfauth=&amp;btn-skin=103\"><\/iframe>\n\n\n\n<p>ERP system use will result in:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>greater productivity<\/li><li>shorter manufacturing and delivery times<\/li><li>increase the total product quality <\/li><li>increase the company\u2019s ROI<\/li><\/ul>\n\n\n\n<p>Regardless of the scale of the company, or whether it uses a continuous or\na batch process, the ERP allows planning, improving, documenting and\nconsolidating the manufacturing processes of food products in an integrated\nmanagement system.<\/p>\n\n\n\n<p>The ERP is\nappropriate not only for large companies, but also for medium and small\ncompanies. Select the right ERP software to optimize the implementation time, the\nman-hours and the economic investment.<\/p>\n\n\n\n<p>The following are the main benefits when you install an Enterprise Resource Planning system in your company:<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_80 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #343333;color:#343333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #343333;color:#343333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#1_Integration_of_the_Functions_of_the_Organization\" >1. Integration of the Functions of the Organization<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#2_ERP_Leaves_Behind_Outdated_and_Ineffective_Planning_Systems\" >2. ERP Leaves Behind Outdated and Ineffective Planning Systems<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#3_Update_Business_Variables\" >3. Update Business Variables<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#4_Streamline_the_Sales_Process\" >4. Streamline the Sales Process<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#5_Optimization_of_the_Productive_Capacity\" >5. Optimization of the Productive Capacity<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#6_Optimization_of_the_Inventory_Levels_in_Time_and_Quantity\" >6. Optimization of the Inventory Levels in Time and Quantity<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#7_Correct_Traceability_of_Food_Products\" >7. Correct Traceability of Food Products<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#8_Proper_Procurement_Planning_and_Sourcing_Process\" >8. Proper Procurement Planning and Sourcing Process<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#9_Proper_Handling_of_Recipes_or_BOMs\" >9. Proper Handling of Recipes or BOMs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#10_Optimization_of_the_Supply_Chain_Efficiency\" >10. Optimization of the Supply Chain Efficiency<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.mrpeasy.com\/blog\/food-manufacturing-streamlining-with-manufacturing-erp\/#11_Streamlining_Economic_and_Financial_Operations\" >11. Streamlining Economic and Financial Operations<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"1_Integration_of_the_Functions_of_the_Organization\"><\/span>1. Integration of the Functions of the Organization<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Can you imagine an organization where the departments work in watertight\ncompartments or silos?<\/p>\n\n\n\n<p><strong>Effective communication is a key point to develop an effective food manufacturing system<\/strong>. The impacts on some functions when implementing an integrated ERP management system are as follows:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Sales can determine the availability of finished products and set discount policies.<\/li><li>Planning gets updated sales forecasts. It is possible to build a strong Production Plan and Master Planning Schedule (MPS), with a vision for the mediate and immediate future.<\/li><li>Production will have the ability to track the progress of the production programs. It will also detect efficiency opportunities (Machine, Labor, Materials).<\/li><li>Maintenance will be able to examine the available time. It will be capable to set and deliver proper preventive maintenance and interact with the Manufacturing team.<\/li><li>Warehouse will ensure correct availability of raw material, semi-finished goods and finished goods.  <\/li><li>Logistics will ensure compliance with delivery programs in time and quantity using a proper inbound and outbound logistics system to either warehouses or distribution centers.<\/li><li>Purchasing will carry out an adequate procurement process.<\/li><\/ul>\n\n\n\n<p>Can you think of a better way to integrate all business variables without\nthe use of an integrated management system?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"2_ERP_Leaves_Behind_Outdated_and_Ineffective_Planning_Systems\"><\/span>2. ERP Leaves Behind Outdated and Ineffective Planning Systems<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Regardless of the type of food product, you stop using the spreadsheets. Food Company\u2019s needs agile management tools to maintain their competitiveness in the market. <a href=\"https:\/\/www.mrpeasy.com\/production-planning-software\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Cloud-based production planning software (opens in a new tab)\">Cloud-based production planning software<\/a> represents the solution to this problem.<\/p>\n\n\n\n<p>The use of these tools contributes to:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>reduce manufacturing waste<\/li><li>maximize manufacturing efficiency<\/li><li>improve communication effectiveness; ERP systems reduce the excess of\ncommunication via email or telephone<\/li><li>improve company\u2019s planning system<\/li><li>maximize the return on investment<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"3_Update_Business_Variables\"><\/span>3. Update Business Variables <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The product prices, the costs, the delivery times or the product formulas \u2013\njust to mention some variables &#8211; are in one place. Having an ERP system will\nallow to set the input variables and get quickly the output variables.<\/p>\n\n\n\n<p>You can track customer prices, compare historical cost information,\ndelivery times, manufacturing times or product compositions. The ERP allows organizations to focus on the business\nstrategy rather than tactical changes.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"4_Streamline_the_Sales_Process\"><\/span>4. Streamline the Sales Process<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The sales area has\nseries of tools capable of increasing the sales productivity:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>it generates quickly accurate quotations<\/li><li>It tracks quotations and delivered orders<\/li><li>sets prices by adding the markup to the total cost<\/li><li>sends quotations and invoices in a fast speed<\/li><li>in case of using EDI boosts the speed of communication\nwith key business partners<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"5_Optimization_of_the_Productive_Capacity\"><\/span>5. Optimization of the Productive Capacity<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Every food company has machines and equipment, transforming the raw material into a final product. The ERP software allows you to load them into the system and define the production capacity per machine. On the other hand, it allows immediately detecting idle capacity and reallocating resources. It&#8217;s possible to manage the bottlenecks, update seasonal volumes as well as trends and plan capacity increase for the future. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"6_Optimization_of_the_Inventory_Levels_in_Time_and_Quantity\"><\/span>6. Optimization of the Inventory Levels in Time and Quantity<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The most usual problems related with <a href=\"https:\/\/www.mrpeasy.com\/inventory-management\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"inventory management (opens in a new tab)\">inventory management<\/a> that every food company faces are below: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>raw material or ingredients not found in the warehouse<\/li><li>finished or semi-finished goods have exceeded its shelf-life<\/li><li>there&#8217;s excess of SKU&#8217;s in stock<\/li><li>there&#8217;s material \u201cjust in case\u201d<\/li><li>other departments need to give a phone or send an email to check product\navailability<\/li><\/ul>\n\n\n\n<p>The ERP leaves\nthese problems behind. ERP allows all functions &#8211; with the corresponding\npermissions &#8211; to access to a unique, reliable and updated source of information.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"7_Correct_Traceability_of_Food_Products\"><\/span>7. Correct Traceability of Food Products<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The use of an ERP system with <a href=\"https:\/\/www.mrpeasy.com\/food-traceability-software\/\" target=\"_blank\" rel=\"noreferrer noopener\">food traceability software<\/a> functionality streamlines the supply chain and ensures that its food products arrive to customers and distributors properly.<\/p>\n\n\n\n<p><a aria-label=\"Enterprise Resource Planning (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/enterprise-resource-planning\/\" target=\"_blank\" rel=\"noreferrer noopener\">Enterprise Resource Planning<\/a> (ERP) manages recipes, quality control compliance, and traceability. All from an integrated system, designed specifically for the needs of your industry.<\/p>\n\n\n\n<p>Track manufacturing orders in real-time and reduce delivery times for faster delivery. Easily identify the location in time and space of the products of your organization.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"8_Proper_Procurement_Planning_and_Sourcing_Process\"><\/span>8. Proper Procurement Planning and Sourcing Process<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Procurement\nhandles all the purchases, but&#8230;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>what quantity should a company buy?<\/li><li>when and how often should a company buy?<\/li><li>how much should a company buy?<\/li><\/ul>\n\n\n\n<p>Using watertight departments is not the optimal solution. Logistics, Inventory, Production, Sales, and Procurement need to exchange unique, reliable and updated information.<\/p>\n\n\n\n<p>Imagine the case in which the volume demand of a certain candy has\nincreased unexpectedly for the next period. It&#8217;s necessary to ensure that all direct materials\n(i.e. ingredients, raw materials and packing material) are on hand. Get the output data from the Master Production\nSchedule figures and let production start with no delays.<\/p>\n\n\n\n<p>Using a reverse\nplanning, it will be possible to determine:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>the detailed quantities of materials defined in recipes or bill of materials (BOM)<\/li><li>the timings required to dispose the materials on hand<\/li><li>explosion of the amount of materials required for all <a rel=\"noreferrer noopener\" aria-label=\"SKUs  (opens in a new tab)\" href=\"https:\/\/www.investopedia.com\/terms\/s\/stock-keeping-unit-sku.asp\" target=\"_blank\">SKUs<\/a> involved per period<\/li><li>optimize the purchasing volumes and minimum order quantity<\/li><li>get cost savings by optimizing the purchasing volumes<\/li><li>communicate any material delay or lack of materials to the rest of the organization<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"9_Proper_Handling_of_Recipes_or_BOMs\"><\/span>9. Proper Handling of Recipes or BOMs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Do you have accurate information on the amounts of ingredients that your\norganization requires to obtain a unit of each SKU?<\/p>\n\n\n\n<p>What happens every time the recipes or the ingredients change or the\nfinished product has new specifications?<\/p>\n\n\n\n<p>In today&#8217;s food industry, it&#8217;s necessary to have an agile and precise system to convert raw material into the finished product. Determine with no extra calculations the amount of required ingredients from the volume demand with the <a href=\"https:\/\/www.mrpeasy.com\/bill-of-materials-bom-software\/\" target=\"_blank\" rel=\"noreferrer noopener\">BOM software<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"10_Optimization_of_the_Supply_Chain_Efficiency\"><\/span>10. Optimization of the Supply Chain Efficiency<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The use of ERP\nallows you to buy what is needed, when it is needed and combine the factors of\nproduction on time. Feel free to make changes in the sales forecast and the system will quickly\nupdate all the dependent variables of the organization. Create production orders and streamline the picking\nlist are some of the advantages when using an ERP.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"11_Streamlining_Economic_and_Financial_Operations\"><\/span>11. Streamlining Economic and Financial Operations<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Gain visibility of trends with integrated reports of sales, costs and\nprofitability by product or family of products.<\/p>\n\n\n\n<p><strong>What happens when an organization implements an ERP system?<\/strong><\/p>\n\n\n\n<p>The implementation\nof an ERP can benefit a food business in multiple ways. Summarizing, it contributes to build a system\nin which customers receive the right amount of product with the right quality\nat the right place and time.<\/p>\n\n\n\n<p>Take your organization to the next level using ERP software and let your organization focus on your business core.<\/p>\n\n\n\n<p>Find the best solution from our list of the <a href=\"https:\/\/www.mrpeasy.com\/blog\/manufacturing-erp-systems\/\">Top Six Manufacturing ERP Systems for Small Manufacturers<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The use of Enterprise Resource Planning (ERP) is an essential component in the management of food products manufacturing.<\/p>\n","protected":false},"author":4,"featured_media":3614,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[94],"tags":[58,82,3,4],"class_list":["post-3613","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tips","tag-erp-system","tag-food","tag-manufacturing","tag-manufacturing-software"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.7 - 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