Small businesses see big benefits from SAP Business One

June 19, 2009 by SAP News 0

Issued by: Ogilvy Public Relations Worldwide

JohannesburgSAP Business One continues to make strides in the local small business arena, capturing a growing number of SMEs across an increasingly diverse range of industries and sectors.

“Increasingly smaller companies are seeing the value in SAP, with more than 200 SAP Business One implementations in South Africa alone,” says Derek Kudsee, director SME, SAP Africa, “business software solutions used to be considered expensive, time-intensive and disruptive – this is no longer the case.

“If you review some of the installations we completed in the past year, you will see a growing trend among smaller companies, across a wider spectrum.”

In 2008, SAP South Africa implemented SAP Business One in companies ranging from a taxidermist, flower wholesaler and nutritional supplements supplier through to an IT components distributor and a specialist paper manufacturer.

“Highveld Taxidermists is a very good example of how SAP Business One can bring industry best practice to a small, but complex business,” says Kudsee.

The company, the world’s largest taxidermy business, needed a solution that would help it co-ordinate accurate management of import and export activities while still meeting health, veterinary and quarantine requirements without impacting on production schedules.

“The ordinary accounting package we had gave us no visibility into our production processes, which meant that we struggled to get all the trophies that needed to be exported simultaneously ready at a given time,” says Highveld Taxidermist director, Thomas Ochsenbein. “That, in turn, meant incurring penalties for holding up containers.”

Another small, but complex business that has benefited from SAP Business One is Flowerspot, a family-owned retailer that also services the corporate and trade sectors, and has more than 31 000 line items to manage.

“SAP Business One solved our greatest problem, that of keeping track of all our line items, giving me much better control,” says Flowerspot director, Dennis Duarte. “I can get relevant reports when I need them. I can go back into the history of a transaction confident that the information there is accurate. And in the year that we’ve been using SAP Business One, not a single transaction has been lost. The system is utterly reliable.”

Amazingly, the 12-user system was installed within a single week. This was possible after Duarte cleansed his existing database in the run-up to the implementation. “Making sure I had the data I wanted was time-consuming, but it allowed us to import the whole database straight into SAP Business One without a hitch,” he says.

“The time factor – whether for the scoping, customisation or implementation – is always one of the most critical factors because it has a direct bearing on the cost of the project,” says Kudsee. “We have demonstrated again and again that SAP Business One is a cost-effective solution that carries the punch of a heavyweight solution without unnecessary expenses.”

A quicker implementation also results in a quicker return on investment, as was experienced by Nelspruit-based maintenance contracting firm Nelco Carpentry Services.

“The benefits we got from SAP Business One were immediate,” says Peet van Zyl, the company’s managing director. “Because we’re involved in a lot of small projects to do with painting, plumbing, electrical, and carpentry maintenance and ad hoc jobs like laying concrete slabs, our inventory includes a wide range of small but essential items. Tracking them accurately using a manual system is almost impossible.”

Since installing SAP Business One, however, it has boosted his operational efficiencies to the extent that he is now able to plan projects seven weeks in advance and, thereby, significantly reduce his inventory and increase the accuracy and timeliness of his billing.

This type of tangible business benefit was also experienced by Enigma Thin Client Systems.

“Before we got SAP Business One, we were losing about R50 000 a year on unbilled services, simply because we had no means of tracking them,” says Enigma company owner, Peter Storbeck.

“The solution has worked so well for us that we’ve been able to reduce headcount by one and run a considerable client base in six provinces with only five full-time members of staff.”

The full power behind SAP Business One is that it enables small businesses to work to the same standards, albeit on a smaller scale than large enterprises, is something appreciated by all business owners.

“Before we got SAP Business One, we were losing about R50 000 a year on unbilled services, simply because we had no means of tracking them,” says Enigma company owner, Peter Storbeck.
Multi-flor, a supplier of flooring products and solutions to retailers across southern Africa, is one such company that realised significant improvements in its inventory management within four months of implementing SAP Business One.

“SAP Business One constituted a real leap forward for us,” says William Schutte, Multi-flor’s financial manager. “It has proved the business power of having realistic information in forward purchasing and stock holding. We’ve been able to significantly reduce stock holding because our ordering, planning, and importing patterns are coming from a more logical point.

“Also, for the first time in the 30 years of the company’s existence, we’re getting other company information on a daily basis – almost before we need it! We can see daily turnover, sales, and margins – all the way down to customer-specific margins. Previously, we used to know we were making a certain margin, but we didn’t know where.”

Kudsee says this kind of previously unknown power over the business is critical in managing a business, particularly a rapidly growing one. SAP Business One’s scalability to grow with the business is one of its strongest points, he adds.

It was for this reason that NutriLida Healthcare, a supplier of over-the-counter nutritional supplements and other healthcare products to pharmacies and wholesalers, implemented SAP Business One. “Our original financial management systems weren’t coping with the extra demands we were making on them and so we looked around for an application that would grow effortlessly with us,” says Heilke van Loon, the company’s financial manager.

“Specifically, we wanted an integrated system that would help us manage the huge volumes of the more than 40 products moving in and out of our warehouse on a daily basis and automatically tie all of that activity back to our financials.

“The solution has made us more efficient by giving us real-time information into the status of our warehousing and distribution activities,” says van Loon. “That gives us better control over inventory as well as the cost of sales. And we’re better able to track the sales pipeline.

Kudsee says a number of companies have identified the need to streamline and manage their business better in the current economic climate.

“A manager may be inclined to cut labour costs, for example, but if he is bleeding cash due to inefficient inventory management, he won’t be solving the real problem.

“That is what SAP Business One provides – an immediate and accurate view of the business that allows managers to make the correct decisions, timeously.”

SAP

SAP is the world’s leading provider of business software(*), offering applications and services that enable companies of all sizes and in more than 25 industries to become best-run businesses. With approximately 76 000 customers (includes customers from the acquisition of Business Objects) in over 120 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE, under the symbol “SAP”. (For more information, visit www.sap.com)

(*) SAP defines business software as comprising enterprise resource planning and related applications.

Editorial contacts
Ogilvy Public Relations Worldwide
Collette McRobert
(011) 709 9660
collette.mcroberts@ogilvypr.co.za