Inventory & Accounting ERP Software Blog

How to use the 80/20 Rule to Cut Costs in Your Warehouse

In the late 19th century, an Italian economist named Vifredo Pareto noted that approximately 80 percent of the land in Italy was owned by 20 percent of the population. The core of the idea is this: the majority of results come from a minority of causes. 80 percent of our output comes from 20 percent of our input. This observation from Pareto, published in his first work Cours d’économie politique while at the University of Lausanne, is the foundation of the Pareto Principle or the 80/20 rule – a powerful concept now widely used by leaders and businesses around the world. By maximizing the power of the 20 percent providing the greatest gains, and by reducing the 80 percent that is problematic, leaders and businesses who adopt this concept are more efficient, effective and successfully increase the profitability of their organization.

So, how can we use the Pareto Principle to help reduce costs?

When using this principle to analyze business costs, most likely you will see that 20 percent of your cost categories are adding to 80 percent of your costs. If you can determine what’s in that 20 percent, you know what to target. Your next steps are to take action on those areas.

For example, let’s say you use the 80/20 rule and identify mistakes in your warehouse as being one of your top cost areas. You see that cost and think, “Ok, I’m going to reduce costs by minimizing mistakes in the warehouse.” But, to use this principle effectively, don’t stop there. Use another Pareto analysis to examine the different types of mistakes and calculate how much each type costs. Are the mistakes related to picking the wrong product? Are the mistakes related to improper put-away processes and lost inventory? Are the mistakes related to manual processes and lack of automation? Most likely, you will again find that 80 percent of your mistakes are being caused by 20 percent of the problems, so the problems in that 20 percent are the ones to target.

The good news is that there won’t be many to tackle before you start to see progress. Using the Pareto Principle, out of 10 different types of mistakes identified in your warehouse, you’ll only need to focus on 2 types, the other 8 being all the small mistakes that only add up to 20 percent. Using this rule, it’s easy to see that there are a few underlying causes that are causing most of your problems.

How powerful is the 20 percent?

Let’s look further into these top 2 causes of mistakes in the warehouse. If you think about it, these 2 causes are not just 4 times as costly as the other 8. They are actually 16 times as costly. As they are only 20 percent, there are a quarter as many of them. Since they are worth 80 percent, they are actually 4 times as expensive in total, a factor of 16. In other words, if 2 of them cost $80 and the remaining 8 of them cost the remaining $20, then the first 2 are costing $40 each and the other eight are costing only $2.50 each. Clearly, it’s very important to focus on those 2 causes.

Where to use the Pareto Principle to cut costs

To help use the 80/20 rule for cost savings, let’s look at 3 examples where you may be able to identify problems and reduce costs in your warehouse:

Warehouse Layout. When you analyze your warehouse layout using the Pareto Principle, you might see that 20 percent of your warehouse gets utilized 80 percent of the time. Is this 20 percent optimized for the most efficient, picking, packing and shipping? Why is this area of the warehouse used more? Is it because it holds the most high-volume inventory? Is it where picking takes place? Packing? Consider options to make even more use of this space or expanding it to include more product and operational processes.
Stock. This is another easy to identify area where Pareto applies. So, 80 percent of your stock costs (your money that’s tied up in stock), probably comes from 20 percent of the items. What are those high-value items and are you selling enough volume to offset the costs? Ask yourself questions such as, can inventory management software help improve inventory turnover?
Sales. 20 percent of your customers generate 80 percent of your revenue. Are you wasting time on customers that aren’t worth it? How can you keep the 20 percent of your customers happy? What types of products are these customers purchasing and how often? Although its never a good idea to only rely on a small number of customers for continued revenue growth, this type of information can help you direct resources and determine which customers to spend the most time with.

When trying to cut costs, it’s easy to become overwhelmed by the number of areas to consider and get distracted by fixing problems that won’t yield the best results. The Pareto Principle helps put cost savings in perspective and highlights effective areas of focus. Use the insights you gain to make the greatest impact on your business and then get ready to reap the rewards.

If you’re interested in other ways of cutting costs and finding ways to save money in your warehouse, take a look at our resource Top Inventory Techniques That Will Save You Money.

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Updates on the Global Cannabis Industry from the MJ Biz Conference

With conferences around the world, MJBizConINT’L is where business, research, and policy intersect to advance the global cannabis industry. Each business conference welcomes global cannabis executives from mature and emerging markets to network and learn through educational sessions with discussions on conditions, market trends, future opportunities, regulatory considerations, research, science and more. This past week was the Toronto edition of the MJBiz Conference held at the Metro Toronto Convention Centre from September 4th to the 6th. The Toronto conference included keynote speaker Kim Campbell, former Prime Minister and other noteworthy speakers including Mark Zekulin, CEO of Canopy Growth Corp., Kevin Murphy, CEO of Acreage Holdings in the US, Alfredo Pascual, International Analyst at Marijuana Biz Daily, Kay Tamillow, Director of Research, Brightfield Group, Trina Fraser, Partner at Brazeau Seller Law and more. The conference included more than 40 sessions covering topics ranging from opportunities in hemp and CBD, to Cannabis 2.0 regulations, to different global market outlooks and future predictions. As an international conference, the show provides opportunities to learn more about opportunities and regulations in areas outside of North America, and provides ample examples of countries and cities that have done it right, as well as cautionary tales. With so many great sessions and speakers, there was a lot of information to take in, but I’ve compiled a list of some of the most important learning points from the show.

International Market Opportunities

Outside of North America, the Germany market is one of the biggest in terms of future opportunities in medical Cannabis sales due to it’s aging population and regulations. Germany is currently depending explicitly on imports for flower product.
There has been minimal activity on the recreational side in Europe, however, as smaller countries start to legalize, this may have a positive impact on larger, neighboring areas.
Within Latin America, there are huge opportunities with countries such as Mexico which is on track to become the 3rd largest country in the world to Federally legalize Cannabis.
The biggest issues for some international markets are not legalization, but supply chain. Many international markets have a legalization framework, but no infrastructure for supporting consumer demand.
If Asian countries such as China decide to legalize, this will have huge impacts on the market due to the population size – even if 1% of the China market purchases Cannabis product, this presents a significant revenue stream.

The US Market

The USA is by far the largest market and this is anticipated to continue to grow, especially if Cannabis becomes Federally legalized.
Overall, a lack of good data makes sales estimates tricky, but many states are starting to provide monthly updates on the number of medical Cannabis patients and recreational sales numbers which will continue to aid in future market predictions.
There are more medical Cannabis markets in the US, but they are smaller in size than recreational markets.
Recreational markets are more valuable, but also more competitive.
In the US, we have started to see more and more Eastern states legalize which is helping to grow the whole market.
Industry experts from other markets such as CPG are helping to grow the industry through consolidation and supply chain expertise.
Continued US market growth will come from both recreational and medical sales, however, this leaves the question of where certain CBD-type products fall (think beverages, skin care products, etc.)
In the US, the mass market demand is not coming from flower products but instead from edibles, vapes, oils etc.
For both medical and recreational Cannabis users, it’s less about traditional smoking methods and more about alternative ways to consume. This is a lesson for all LPs to have a plan in place for focusing on product development outside of just flower product in order to survive in the future.
For those interested in flower products, it will be for premium flower grown in top-notch facilities. Right now, there is a lack of supply of high-quality flower.

The Canadian Market

There were several issues with the original Cannabis legalization in Canada including lack of supply.
Due to the initial and on-going shortage of Cannabis products, brands have been unable to develop the full consumer experience and instead consumers are forced to buy only what is available.
This issue is amplified by strict regulations around marketing and the ultimate goal in the recreational Cannabis space is to develop the market for different types of consumer groups – for example, budget consumers vs. those who want a more premium product experience.
Canadian companies like Canopy, are leading the industry in terms of investment and intellectual property (IP). IP for products such as pre-roll machines and processes such as extraction is helping to shape the global market.

Cannabis 2.0 in Canada

Cannabis 2.0 in Canada refers to the upcoming October 2019 regulations and legalization around the extraction market, topicals and edibles.
Many industry experts believe that the long-term profitability of Cannabis product will come from either vape sales or beverage sales.
Cannabis beverages provide a social consumption opportunity with additional benefits including low calories and no hangover.
Companies can start to take advantage of this opportunity by developing IP that goes into delivering an enjoyable social experience.
Regulations around edibles and topicals leave a lot of room for interpretation – right now Health Canada has set out guidelines that make it very clear what businesses can’t do, but not what they can do. There is no closed list of the specific types of products a business is allowed to create.
One of the biggest surprises around the October 2019 date is the requirement that organizations manufacturing Cannabis products must have a separate manufacturing facility for infused products and non-infused products. This will potentially reduce the number of “ready” licensed manufacturers and begs the question of what constitutes two separate facilities?
Currently there is no requirement for the automatic transfer of testing data from labs to back-end business management seed-to-sale software, which means it is up to each company to determine what information they input manually and report on. This raises concerns around testing standards, product specs and which data sets to include from multiple labs and testing facilities.
Some Cannabis companies are trying to vertically integrate and “do-it-all” – cultivation, extraction, manufacturing etc., but this is not a sustainable business model – especially in the start-up space and instead Canadian companies should focus efforts on one area of the market and doing it well.
All edible products will have to be “shelf-stable” which makes chocolate products a risky choice.
The Quebec market is trying to impose its own extremely restrictive regulations.
In general, its hard to know what types of products will get approved by Health Canada the quickest, and although there are a lot of general rules guiding the industry (such as restrictions on adding sweeteners to extracted products) there is no clear definition as to what makes something a sweetener vs. a flavor and these types of questions will be addressed on a case-by-case basis.

Attending these types of conferences is important for keeping up-to-date and getting a head start on industry best practices and future regulations and market predictions. However, its important to note that the industry as a whole is constantly changing and there are still a lot of unknowns and contradictory information being presented. As a representative of Blue Link ERP, I attended the show to learn more about what’s happening in the industry to continue to build out our Cannabis software solution.

About Blue Link Cannabis ERP

With over 20 years’ experience as an all-in-one inventory management and accounting ERP solution, Blue Link has been helping businesses streamline and automate processes for decades. Blue Link’s robust lot tracking and reporting functionality for pharmaceutical distribution companies has helped us develop specific features and reports to aid in meeting Cannabis regulatory requirements set out by Health Canada and other regulatory bodies. In addition to Cannabis-specific functionality, Blue Link provides tools for warehouse management, CRM, financials, inventory, order entry and processing, pick, pack and ship and works with industry partners for your pre-harvest and post-harvest cultivation needs, and eCommerce requirements.


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What is the Internet of Things (IoT) and how does it relate to smart devices?

Would you like to understand what the Internet of Things (IoT) is and what it means for business owners? Or maybe you’re already familiar and just need a refresher. How does the internet of things relate to smart devices?

In this post, we’ll look at the definition of IoT, along with an explanation and an example of what it is. Then, we’ll move on to the differences between connected, smart and IoT devices and how they all relate to each other. To wrap things up, we’ll take a quick look at what this means for business owners.

What is IoT?

Daniel Burrus, one of the world’s leading technology forecasters and innovation experts, defines the Internet of Things as:
“…a combination of networked sensors and machines that enable machine-to-machine communications. Enabling technologies to include the Internet, advanced cloud services, wired and wireless networks, and data-gathering sensors, making the system instantaneous anywhere, anytime.”
In other words, the Internet of Things is simply an extension of the current Internet, expanding into our physical world, and more specifically, physical objects.

For example, let’s pretend you own a factory and it’s your job to oversee a building full of machines and equipment that create products or perform services. If one machine goes down, your supply chain and business will suffer. Maintenance and regular checks are key for making sure that your operation goes on seamlessly.

But it takes time and money to look at every machine individually. Even if you’re performing regular, daily checks on all your equipment, you’re working from old and possibly outdated data. Unlike manual maintenance and checks, IoT capability gives you access to real-time information on the status of your operation and can predict and alert you to potential issues. Instead of working from a day-old or week-old report, you know exactly what is happening in real-time, giving you the opportunity to stop interruptions before they start.

IoT is the process of giving a physical device or object the ability to connect to the digital world in a real way. In this example, your machines now report as devices, and these devices connect to a centralized hub. Your machines now share information like battery level, operating efficiency and even give reports on any jams or specific operating issues that you may need to know about, and would have previously missed with manual checks.

As you can imagine, this will significantly reduce the response time needed on business-critical actions. In addition, you can now schedule maintenance repairs when you know you need them. This example uses a factory, but it doesn’t stop there. Eventually, IoT will be the solution to monitoring and maintaining distributed machines everywhere from assembly lines, airports, drone deployments, buses, within your home and so on.

How are IoT devices different than connected or smart devices?

Back in 2014, Michael E. Porter and James E. Heppelmann assessed the difference between smart and connected technology in the Harvard Business Review this way:
Smart things are products that incorporate sensors, microprocessors, data storage, controls, software, an embedded operating system with enhanced user interface, and the capability of running autonomously (e.g., following a programmed schedule). Smart devices are often connected to a network of some kind, but it’s not required.

Connected things are products with sensors, microprocessors, and controls that communicate with networks in order to serve two purposes. On one hand, it exchanges data over the network to allow monitoring and data collection. On the other, it’s designed to allow some of its functions to be controlled remotely by one of those smart things over a communications network.
In other words, smart devices provide some level of automation, gather data and can be programmed for specific uses, while connected devices are limited to being remotely controlled and monitored.

For example, a connected clothes dryer can tell you when your cycle has finished. A smart clothes dryer, on the other hand, may have sensors to detect if the clothes are dry before the full cycle is complete, and can be programmed to shut off and conserve energy instead of continuing to dry already dry clothes.

IoT devices are a step up from connected and smart devices and create more value because they are more scalable, upgradeable, automated and future-ready. In the example used above, an IoT clothes dryer goes beyond sensing when the clothes are dry and can determine the most cost-effective way to dry the clothes. For example, the device can collect data such as the humidity level of the geographic area of the device, the most efficient fan speed, heater temperature, local electricity rates and so on to predict when the load will be ready and how much it will cost to dry the clothes.

What does this mean for businesses?

Eventually, all companies will have IoT solutions and systems in place. By using IoT products, businesses will have access to better business insights and consumer experiences, can further reduce costs and equipment downtime and easily identify more ways to boost efficiency and productivity. Changes will also be seen when it comes to asset tracking, eliminating waste and reducing inefficiencies.

But, we’re not quite there yet. Implementing IoT solutions is still costly and convoluted. In the meantime, business owners have access to a wide range of other information sources to help streamline operations, drive business decisions and help increase their bottom line, such as advanced real-time reporting and business intelligence (BI). Like IoT, business intelligence can help business owners improve efficiency and increase productivity.

To learn more about what BI encompasses, and how it adds value when incorporated into an ERP system, look at our whitepaper “Using Business Intelligence Tools to Drive Decision Making.”


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Blue Link ERP Launches Financial Report Writer

Financial statements – love them or hate them, they are a necessary component to business management and provide you with a quick snapshot of your financial business health. Without proper financial reporting tools, creating standard financial reports such as income statements (profit and loss statements), balance sheets and cash-flow statements can be a tedious and time-consuming process. However, with the right financial report writing tools, the process of creating, editing, updating and sharing financial reports turns into a quick and easy task – one that yields huge results in helping you see problem areas and opportunities in your business. To better help our customers with their financial reporting requirements, Blue Link ERP is excited to announce the launch of our Financial Report Writer! Provided as part of our accounting ERP solution, Blue Link’s Financial Report Writer is a cost effective tool built into Excel that allows our customers to link general ledger data from one or more Blue Link database to easily create financial reports. Before we tell you more about this awesome tool, let’s start from the beginning with some basic information on financial reports in general.

Reporting 101

There are 3 main financial reports important to every business – the income statement (also referred to as a Profit and Loss or P&L statement), balance sheet and cash-flow statement. These reports provide insight into business financial health, include important information necessary for auditing purposes, and provide shareholders and management a way to quickly see how the company is performing financially.

Income Statement

An income statement is a financial report that looks at your company’s revenues and expenses over a specific time period and then uses that information to determine if your company made a profit or loss. Your company can then compare the information from multiple income statements across a variety of timeframes. This gives you a better understanding of your company’s overall financial health, cyclical changes and patterns, and it helps aid in decision making. Understanding your company’s financials allows you to identify and prepare for any profit increase and losses.

Balance Sheet

Your company’s balance sheet provides insight into how much equity you have in your business. In other words, the balance sheet refers to the total company value for a specific time period after assets and liabilities have been reported. After calculating all your business assets (what you own) and all your business liabilities (what you owe), you are then able to determine your company’s total equity.

Cash-flow Statement

Similar to your income statement, your cash-flow statement includes information about revenues and expenses, but unlike the income statement, the cash-flow statement takes into account when revenues are collected and when expenses are paid. Simple calculations allow you to see whether or not your cash flow is positive. If you have more cash coming in than you do going out, you have a positive cash flow. The reverse scenario represents a negative cash flow – when you have more cash going out then you do coming in. A review of your cash flow statement allows your business to prepare and adjust operations to accommodate gaps, and to plan for any specific business projects, large purchases or other business decisions.

Blue Link’s Financial Report Writer

To help our customers easily create, edit and share financial statements, Blue Link ERP recently launched its own Financial Report Writer. As an Excel add-in, this tool is built into the Excel interface and links to live Blue Link general ledger data. This specific tool links to Blue Link general ledger data and facilitates segmenting reports by up to 4 distinct segments including GL account, GL department, job code and cost code. Since Blue Link ERP has the ability to link to other data sources in Excel, users of the Financial Report Writer tool are also able to combine ODBC-linked data from other sources or databases into the same workbook for more advanced reporting. The ability to live-link data turns Excel into a powerful reporting tool that allows businesses to report on various information – including sales, inventory, salespeople and more.
Learn more about Blue Link’s Financial Report Writer and accounting software functionality.



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Four ERP Sales Reports to Help You Make Better Business Decisions

ERP software gives you access to an endless amount of data about your business, but have you ever wondered if you’re using that information to its full potential? ERP Sales reports such as Sales by Month, Sales by Territory and a variety of others contain crucial company and customer data that could help you boost your business. But, if you aren’t generating and analyzing reports regularly, there’s no doubt that you’re missing out.

Some companies don’t realize the power they can unlock by using these reports, and others just aren’t aware of what types of reports are available. With the right ERP reporting and analytics, it’s easy to identify opportunities and make faster, smarter business decisions.

Blue Link ERP provides tightly integrated inventory management and accounting software tools, out-of-the-box report templates and the ability to generate immediate ERP sales reports tailored to your business. Check out these Blue Link ERP sales reports to see the type of data you have at your fingertips:

Sales by Month – Determine the progress of sales throughout the month, year or given time period. When you generate a sales-by-date report, you can also identify trends or patterns around high-sale or low-sale periods. Using those insights, you can plan targeted campaigns to leverage high peaks or improve low producing months using special discounts or promotions. These types of reports also help you make purchasing designs by identifying demand trends throughout the year.
Sales by Territory – Easily identify how each territory is performing and see the performance of individual reps. This report can help you identify which territories to focus on, where to add resources and other factors that influence sales in any given area.
Customer Ranking – Zero in on customers that are not buying the same quantities of products this year compared to previous years. By investigating increases or decreases in purchasing behavior by customer, you identify industry trends and see which customers need more support.
Weekly Top 10 Customers – Discover customer buying behavior and patterns and pinpoint which accounts customer service and sales teams should focus on. This report can also help you engage inactive customers or drive loyalty with top customers.

PDF Version: More Information on the Above Reports

Sales reports are only just one type of report important for business management. Financial reports such as Income Statements (Profit and Loss Statements) and Balances Sheets provide insight into the financial health of your business. Exception Reports provide information on anomalies and provide guidance as to which area of business processes to focus on. Inventory Reports such as Inventory Ranking Reports provide insight into profitability vs. holding costs for determining purchasing volumes and pricing. It is important to find a solution that allows your business the flexibility to report on all aspects of the business and includes features for customizing reports, reporting on live data and automatically generating and emailing reports to appropriate stakeholders.

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The Top 5 Warehouse Inventory Software Features Every Wholesale Distributor Needs

Do you buy and sell inventory? Do you operate at least one warehouse location? Are you picking, packing and shipping orders to customers every day? Do you purchase inventory from a variety of vendors? Do you take orders from customers over the phone, through email, via a sales team or through eCommerce or EDI? Congratulations! If you answered yes to any of these questions, you need proper warehouse inventory software. Every wholesale distribution business will require much of the same basic functionality for managing inventory, accounting, customer accounts and warehouse operations. And while each business will have its own unique processes, there are several features inherent in warehouse inventory software that can help your business automate processes, eliminate errors, reduce the time it takes to pick, pack and ship orders and keep your customers happy. Manually tracking inventory information in spreadsheets is prone to human error, time-consuming and frankly, frustrating. Although Excel can be a powerful tool, it is not appropriate for growing businesses who instead can benefit from proper warehouse inventory functionality. So, what does that include exactly? Let’s take a look at the top 5 warehouse inventory software features every wholesale distributor needs.

(1) Basic Inventory Control

Starting with the basics, inventory control functionality is an important part of warehouse operations. This includes the ability to set min and max levels, perform cycle counts, track serialized items, pick, pack and ship orders and manage bin and shelf locations. Proper inventory control means knowing what inventory you have available in your warehouse, in-transit, or on backorder at any given time. This allows your business to determine stock levels based on supply and demand and account for leads times and seasonal fluctuations. Holding too much or too little inventory can result in extra costs or lost customers, and without a properly organized warehouse, employees are left wasting time finding product when picking orders.

(2) Accounting

The best warehouse inventory software also includes functionality for accounting. Typically, this type of all-in-one solution is known as ERP software and includes functionality for inventory management, warehouse operations, AND accounting. This is because you can’t do one without the other. The right warehouse inventory system will also include tools for order entry and processing, purchasing, invoicing, tracking accounts receivables and payables and managing the financial processes of your wholesale distribution business. While you may have been able to manually track inventory information in a spreadsheet and then accounting information in a separate solution (like QuickBooks), as your business continues to grow and order volume increase, this will become unmanageable. A simple keying error or a delay in updating information across systems can all cost your business money – and can result in upset customers and employees.

(3) Barcode Scanning

Barcode scanning is an easy way to improve on existing warehouse and inventory management operations. Scanning product during the receipt and pack process reduces the amount of errors, decreases the time it takes to unload and ship product and helps to ensure you’re shipping the right items to the right customers. If you’re looking for more advanced barcode scanning, consider functionality for mobile handheld picking. This functionality works on mobile devices, allowing users to scan products at the source during the picking process.

(4) Reporting & Analytics

Reporting and analytics is a must-have for any business. Tracking information such as top inventory sales by unit, inventory slow moving items, sale by date, inventory movement exceptions, as well as financial reports such as profit and loss statements, allows your business to make informed decisions. The right information available at the right time aids in purchasing decisions, helps to negotiate rates with suppliers and customers and provides insight into opportunities for special promotions or discounts. Reporting provides a snapshot of company health and helps to identify patterns and trends.

(5) Lot Tracking

Lot tracking functionality (or traceability) is an important feature for companies that deal with perishable or potentially harmful products and includes tools for tracking expiration dates. Lot tracking allows your company to track the movement of inventory from supplier through to your customers. In the case of a recall, lot tracking and recall management functionality helps you quickly identify which products were affected and notify the appropriate customers. Lot tracking is also useful for businesses that need to track dye lots for specific color patterns.

Finding a software solution with the 5 features listed above is a great starting point for automating processes and growing your business. At a bare minimum, a solution should include basic tools for inventory and accounting. It is then important to find options that also include advanced functionality depending on your specific needs and industry requirements. The right software solution can be a huge asset for your business – if you take the time and dedicate the resources and money to finding a proper system.



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What is a SaaS ERP Software Implementation?

Software implementations cover a variety of activities performed by the vendor you’ve selected and its team of experts, internal employees and potential users, your management team, and occasionally any outside consulting or IT representatives. When you make the decision to implement a piece of software, you’re also agreeing to follow the implementation processes laid out by that vendor. This means it is important to ensure all employees are onboard for the change and available to help where needed, outside of their normal job responsibilities. The specific requirements of your team during the implementation process and that of the vendor are identified during initial implementation meetings to make sure everyone is on the same page, and to ensure that adequate resources have been provided to complete the implementation on time. With SaaS-based enterprise software, implementations do not happen overnight, but rather, over the course of several weeks and months depending on the vendor’s schedule and how complicated the implementation. For example, implementations usually take longer when there is a high number of employees that need to be trained, if there is more than one company implementing the software, when there are multiple warehouse locations, when you’re moving from a very old legacy piece of software, or when you’re moving data from multiple existing solutions and sources.

SaaS Applications

As previously discussed, SaaS applications (software-as-a-service) apply to software that is licensed on a subscription model where the software is hosted on the software provider’s servers (or servers leased by the software provider) and not on the customer’s own physical equipment. With SaaS ERP there are different means of accessing the software and data. One common method is through an internet browser where a user types in a URL and then enters login and password information to use software via a specific website. Another option is to connect to software via an RDP connection.  RDP stands for “remote desktop protocol” and is a Microsoft licensed technology that essentially allows a user at a remote computer to log into a server or a specific computer on a network over an internet connection.  Once logged in, the remote user has access to that server or computer as if they were sitting in front of it. In either case, there can be significant set-up required before your company starts using the software and even though not all businesses will require the same set-up, it is important to carefully review each implementation proposal from the different vendors to determine exactly what is included with the implementation, and what is expected by your team.

Initial SaaS Environment Set-Up

For Blue Link ERP, the initial environment set-up includes spinning up and provisioning a new server environment for each individual customer and installing Windows. This means each customer has access to their own server environment, complete with Blue Link’s ERP software and related technologies and systems (including Microsoft, SQL, Crystal Reports, etc.). Each environment is customized and provides resources applicable to the size and requirements of the company, in terms of storage space, number of dedicated servers, RAM, CPU and web services etc. The initial server set-up also includes adding users and setting user permissions – generating secure login details and providing access to applicable applications and services.

As a Microsoft Partner, Blue Link ERP provides additional Microsoft resources (such as Office 365 licenses) at a discounted rate to our customers, which is also included as part of the set-up for a customer’s server environment.

On-Going Server Maintenance

One of the main benefits of SaaS ERP solutions is that your team does not have to manage the physical hardware, infrastructure or software itself. Instead, your company pays a monthly fee to the software vendor, leaving them to manage the server, software data back-ups, IT maintenance and security, and allowing your team to focus on the core objectives of your business and getting more sales. Once a server has been configured for your company, and you’re actively using the software and hosting environment, there is still regular monitoring and maintenance that takes place behind the scenes. The cost to manage these tasks and additional licensing costs is built into any monthly fees and they commonly include:

Updating server and hardware infrastructure to the latest technology
Maintaining security of data and installation of appropriate firewalls etc.
Data back-ups
Microsoft and other software related updates
Managing users and user permission settings
Anti-Virus/Anti-Ransomware protection
Data security and vault protection

When searching for SaaS ERP, keep in mind the work involved as part of the implementation process and make sure you build this into your time frame. If there is a specific time of year that works best for your company to switch systems or a specific date you had in mind, remember to start discussions with potential software vendors well in advance as most vendors schedule implementations a couple of months in advance based on resource availability.


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Business Management Software – How Many Users Do You Need?

When it comes to purchasing business management software to run your wholesale distribution business, one important consideration is how many employees will need to use and have access to the information in the system. In other words, how many users do you need? This may seem like a simple question, but it’s complicated by the fact that different software vendors have different types of user settings, different features available to different types of users and different pricing structures for type of user. As a starting point, and before you begin discussions with vendors, speak with existing employees to determine how many people will need to use the software and for what purposes. This includes speaking with employees in the accounting department, people working in the warehouse, sales reps and management. Business management software includes functionality to manage all aspects of business operations – accounting, inventory management, warehouse operations, CRM, sales, purchasing, order entry and processing and more. If you’re looking to move to robust business management software from an introductory solution such as QuickBooks, it’s not enough to just count the number of existing users as there will be additional functionality available. Below we explore tips for determining the correct number of users.

User Requirements

Within any organization, there will be many different ways for people to interact with business management software. Some people may only require access to certain areas of the software, some may require access to tools that interact with the software but not the software itself (for example, warehouse employees using barcode scanning to pick, pack and ship orders) and some people require information from the system in the form of reports, but not actual access to the software itself. Because of this, it’s important to start by evaluating existing users in your organization, and then determining how people interact with existing systems and processes. In Blue Link ERP, there are different types of users depending on the nature of the job role.

Blue Link ERP User

A Blue Link ERP user is anyone who needs to interact with the core features of Blue Link ERP – accounting modules, inventory management tools, contact management and CRM, order entry and processing, etc. These types of users require access to one or multiple areas of the software and need to be able to read and/or write data in the system.

Barcode Scanning User

A barcode scanning user in Blue Link refers to the use of mobile handheld picking and barcode scanning functionality. These users correlate with the number of physical scanning devices in your warehouse. In Blue Link ERP’s case, this means the number of iOS devices used to scan barcodes equals the number of handheld picking users. For many wholesale distribution businesses, employees in the warehouse require scanning technology to receive, pick, pack and ship orders but do not need full access to back-end business management software. Usually, a warehouse manager is set-up as a Blue Link user or a generic login is created for all employees to use when interacting with the software in the warehouse. This includes interacting with Blue Link’s pack-to-container screen and sales order review screen. Even though some businesses share a generic login between employees, it is important to note that in doing this, you will not be able to know exactly who has done what in the system by reviewing the change logs.

Point-of-Sale User

A POS user in Blue Link refers to the use of point-of-sale check-out counter features. Similar to handheld picking users, these users are one in the same as the number of physical check-out counter stations set-up at your business. Each check-out counter POS set-up is counted as a POS user, even though multiple employees can log into the POS station using a unique employee identifier. This allows a business to have multiple full-time and part-time employees use the POS features, at a lower cost while still providing the ability to track the actions of individual employees in the system.

B2B Online Order Portal User

With Blue Link’s B2B online order portal functionality, a user refers to anyone requiring a login to the website. This includes both customers of your wholesale distribution business who want to login, place an order, check available inventory and view past orders and open invoices, and your sales reps who want to do this on behalf of your customers. However, even though these people will require a unique login and password, there is actually no cost for setting up users in the online order portal.

User Permission Levels

As mentioned previously, different business management software vendors will have different pricing per user, and some will have different “user levels”. For example, they may have admin users, super users, and light users. Other vendors, including Blue Link ERP, will have one main user type with the ability to set specific permission levels. This restricts employees from accessing specific areas of the software and provides options for read-only access.

User Pricing

Cloud-based solutions typically charge a monthly fee for access to the software based on number of users and functionality. For enterprise level business management software (true all-in-one ERP solutions) user fees can range between $80-$200/user/month. These types of systems have a higher per user fee than introductory solutions such as QuickBooks, as they provide functionality for all aspects of a business’ operations as opposed to just one core area of functionality.



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Replace QuickBooks with ERP and Eliminate Silos

When you think about silos in the workplace, you may think about them in reference to large, multi-national companies with 500 plus employees. Although silos can occur in this type of setting, they can also happen in smaller businesses with fewer people. And silos are not always a negative – they can be beneficial to companies in providing a clear structure, fostering expertise, and encouraging accountability and responsibility. They also provide focus around specific processes and departments, however, in the real-world silos often have the reverse effect.  Instead of benefiting the company as a whole, silos more frequently only benefit those directly in the individual silo. They can limit the understanding of the company’s vision across different departments, decrease collaboration between teams and hinder the flow of information – all of which can result in poor decision-making, low morale and a decrease in efficiency and profitability. For silos to work, they need to be transparent and information needs to flow in and out of each silo – allowing all employees to better understand and contribute to the goals, objectives and needs of each silo and the company as a whole. Even though silos can be a part of any company, growing businesses will frequently experience the negative effects of silos as they grow and add more customers, sales channels and employees. This is because the existing processes and systems in place to manage operations for a small company, are not suitable for growing organizations. As a starting point, growing businesses using introductory software such as QuickBooks will soon realize the limitations of the system as the need to manage more inventory, more sales channels and more customers arises. To manage growth and automate processes requires additional software functionality. In this situation, the decision to implement standalone software solutions that integrate with QuickBooks can increase the negative aspects of silos – different departments using different systems with no point of truth, with information not smoothly flowing in the organization. This is where replacing QuickBooks with ERP starts to make sense. An all-in-one ERP solution helps to coordinate and streamline operations across departments from one system. This means that people from different departments are able to access the information they need to do their job, with insight into what other departments are working on. Let’s explore this further.

Types of Silos

Silos can apply to many different aspects of a company’s operations including functional, departmental, channel and hierarchical.

Departmental Silos

Miscommunication across departments is a part of doing business. But the right technology and processes can limit miscommunication and help ensure everyone has the information available to them to complete their work – without making more work for people in other departments. Communication across departments is especially difficult when dealing with remote workers and offices – an issue that the right ERP solution helps to resolve. Let’s look at an example.

Pretend you have a sales team who is responsible for generating orders and creating new customer accounts. These people enter new accounts and information into a standalone CRM solution, meaning the information needs to be sent to the accounting department and re-entered into QuickBooks for billing purposes. This is where the first issue arises…if the salesperson needs to update this information, will they remember to also notify the accounting department? If not, there can be delays in invoicing, collections, and even shipping of goods. When your sales team and accounting department work in silos, it causes extra administrative work and can lead to errors.

With ERP software, all data lives in a central database. This means that when a salesperson updates contact information in the CRM, it is reflected on the accounting side when someone goes to invoice the customer. Both salespeople and accounting staff (with the right permission settings) have access to a complete view on customers and their respective sales history. In addition, users can add notes that are associated with specific accounts in case there are any additional things to be aware of. This helps improve communication between departments and ensures the information available is always up-to-date.

Channel Silos

As technology continues to present opportunities to serve customers in new ways, businesses are continuing to grow new sales channels. eCommerce channels are an integral part of both B2B and B2C businesses and many companies have separate departments for managing wholesale orders and online orders. Even though it’s important to have staff dedicated to managing each sales channel, it’s important that orders and inventory information are still managed through a central system. With QuickBooks, many companies manually track inventory using multiple spreadsheets which can be prone to human error and require extra time looking up information. ERP software allows you to automate processes to pull order information from all eCommerce channels, and integrate this information with wholesale orders so that employees can properly prioritize and fulfill orders from every customer and sales channel. This also applies for businesses with multiple warehouse locations. Proper ERP software allows you to track information across different locations – so that you always know what inventory is available and where it is.

Break Down Silos with ERP Software

It’s easy to see how the right software can help manage operational silos within an organization. Instead of different departments using different software, ERP centralizes the data so that the different business silos can work together to keep customers happy and manage growing operations. Trying to integrate multiple solutions such as QuickBooks, CRM software, inventory management tools, etc. creates more barriers between employees as they focus on the software and processes important to them, instead of the whole company. Businesses can unify organizational silos across company operations by utilizing one system to manage all business operations.



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Managing Service and Repair with Blue Link ERP

For many wholesale distribution businesses that sell equipment, industrial products, automotive inventory, HVAC products or similar items, they also have a service department for managing inventory service and repairs, regularly scheduled maintenance and for handling warranty items. This service and repair work is typically a small percentage of the company’s revenues and requires fewer resources and attention than the wholesale distribution side. Service technicians may perform work either in-house or on-site or offer both options depending on the product requiring work. Although in this situation, service and repair management is only a small aspect of the company’s operations, it is still important to have software functionality and processes for managing the work. Unlike true service-oriented businesses that need advanced functionality, wholesale distributors with service departments will benefit from an inventory and accounting ERP solution with built-in service and repair features such as Blue Link ERP.

Getting Started

Blue Link recommends that each piece of equipment or inventory that you sell that may require repair or service work, have a serial number. This will allow you to track which specific items presented issues that required work. If you don’t currently use serial numbers, this can be easily set-up in Blue Link.

To track service work within Blue Link ERP, you must configure the different types of service in the system as non-inventory items. Each company will have to define its own service-related items depending on the work. Examples include labour, service, warranty, maintenance, analysis, repair etc. Each non-inventory service item will then have to have an associated set of UOMs. These could include timeframes such as hours, half-day, full day etc. Each time an employee sets up a non-inventory item in the system, they need to define it as a service request item or labour item, or both. For example, the non-inventory item “Rotate Tires” might be a service item, whereas the non-inventory item “30 Minute Initial Analysis” may be both a service item and a labour item.

Creating a Service Order

To create a service order in Blue Link, first, you choose the customer that is requesting the work and then you select the type of work from your pre-determined list of service and labour items. You also have the option to add notes and a description of the problem for each order. Once you have inputted this information, you must choose what equipment or inventory item the service is for. Depending on the nature of your business, you can choose from a drop-down menu based on what equipment the customer in question has previously purchased, or you can set up a new piece of equipment if the customer never bought the original from you. If you need to set up a new piece of equipment, you’re not creating a new inventory item, but rather a separate piece of equipment strictly for tracking purposes.

As you begin to add repair parts to the service order, you must associate them with the service being performed. For example, you might associate the part “Oil” with the service work “Oil Change”. For warranty type work, the parts that get associated with the service category are usually included at zero cost to the customer.

Once you create a service order, you can generate a work order which gets sent to your service department/technicians. Then, once the service is complete, an invoice is created from the work order which has the exact same information as the work order, just displayed in a different format. Alternatively, Blue Link allows you to customize the invoice to hide certain aspects of the work order if you don’t want customers to know the cost of certain items

Although Blue Link is a great fit for wholesale distributors that operate a small service department, the software is not geared towards full service-oriented businesses. If you’re in the market for a new ERP solution, but are not sure which system will be best, consider the following questions as part of your software evaluation process.

What percentage of your business involves selling product compared to providing services?
Do you generate most of your revenue from the sale of goods or from providing service work?
Is service performed in-house or on-site?
How many service trucks and/or technicians do you have on the road?
How many service calls does each truck/technician make every day? Every week?
How do you manage and schedule your service technicians who are on the road?
Do you manage recurring service calls (i.e. yearly scheduled maintenance)?

To learn more about Blue Link ERP and whether our software is the right fit for your wholesale distribution business with service requirements, contact us.

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