A Perfect Fit with Business Philosophy

June 18, 2008 by Joris Spuesens

Garden-furniture made by Bukatchi Foto: Bukatchi

With one showroom in Enschede, the Netherlands, one in Qing Xi, China, and only twelve employees, Bukatchi has succeeded with an annual growth in revenues of around 15 percent. The secret to this success lies in a flexible and cost-effective business model. “Production in the Netherlands simply isn’t profitable,” says managing director Frank Krake. “That’s why we decided to outsource the production activities to China and to work with specialized partners for the logistics in Europe. Our strength lies in our own innovative designs and the smart and cost-effective way we market our products. We also have a quality manager who ensures that the Chinese factories that produce our furniture adhere to the highest European quality standards.”

The company has two branded product lines that target different key customer groups: the distinguished Bukatchi brand is reserved for the top-segment retailers, comprised primarily of garden centers and garden-furniture specialty stores. With the Sombrero brand, Bukatchi caters to price-conscious customers who shop at outlets such as DIY centres in Germany and mid-segment retail stores in Belgium and the Netherlands.

Bukatchi can offer high quality at competitive prices because it manages all the administrative and commercial processes with a limited number of specialised personnel. Bukatchi’s workforce is comprised of sales representatives, an export manager, an internal sales employee, an accountant, a technical designer, a quality manager and several employees in China. “We don’t need to hire our own expensive IT specialist,” explains Krake.

SAP Business One fits to a tee

So when the company needed a new ERP solution, the software had to be easy to use and to maintain – while at the same time offering a broad range of functionality. Until then, Bukatchi used different IT systems from its parent companies and decided to build up its IT infrastructure from scratch, when it became independent.

“I personally don’t have any affinity with IT whatsoever. All that matters to me is that it always works, providing me with the correct management information in a convenient format anytime I want it,” says Krake. “I always adhere to one key criterion: If I don’t understand software, or an IT advisor for that matter, then something isn’t right. And it felt right with SAP Business One and implementation partner AGION. There weren’t any discussions about the fine print and no complicated presentations.”

Krake is not an IT specialist, still he knew exactly what he did not want. From his own experience, he knows that makeshift solutions often lead to the end-users having to gather all the information manually. He has also worked with extremely complex and expensive packages that contained all kinds of frills that were not relevant for current business processes.

So after a close evaluation of different software packages, the company was able to reach a decision quickly. SAP Business One was the perfect fit for Bukatchi: “It was immediately clear to us that SAP Business One offers the functionality and user-friendliness that are critical success factors in our sector,” Krake says. “It gives us the functions we need now and the ability to easily add new functions in the future. And that is precisely the flexibility that characterizes our business processes.”

Krake is also enthusiastic about the speed of delivery: “After carrying out a preliminary study of our processes, AGION delivered SAP Business One within just a few weeks. The accountant was able to provide the SAP partner with all the modifications he wanted before he went on holiday.”

Suitable package for SMEs

The implementation started at the end of July 2007 and was finished in only nine workdays, including training and support for setting up the hardware. Krake is very happy with the functionality and the user-friendliness of the new solution. “With the drag & relate function, for example, I always have access to the most recent figures and outstanding items, as well as to historical data. Customer relationship management, sales, purchasing, price structure, inventory control and order recommendations, automatic work flows – every detail from price quotation to invoice and payment reminders is integrated within SAP Business One,” Krake says.

SAP partner AGION also delivered all the additional functionalities that the company needed, such as one that lets Bukatchi reserve sales bonuses directly on the balance sheet at the detail level at the touch of a button.

According to Krake, the implementation has completely done away with the preconceived idea that SAP is complex. “Our experience is that SAP Business One is an extremely suitable package for the SME sector. SAP and AGION both share our business philosophy: keep it simple and flexible,“ he adds. Bukatchi’s activities are extremely seasonal. As a result, the IT systems must be able to handle the peak periods and guarantee delivery reliability. “Thanks to its automated workflows, SAP Business One provides this certainty,” Krake says. He estimates that with the new solution the company can handle a 50 to 100 percent rise in revenues without having to take on extra employees.

Future-proof investment

Furthermore, Bukatchi is planning to move to a new location within the next eighteen months, and thanks to SAP Business One, Bukatchi’s IT infrastructure is completely future-proof. “We can easily add functions that we don’t currently need but might need in the future. And this flexibility is extremely beneficial to a trading company that must maintain competitive margins.”

Jasper Schutten, from the office staff, applauds SAP Business One’s user-friendliness: “I used to have separate Excel files alongside our accounting package. With SAP Business One, the processes are better integrated and the information from my section is channelled automatically to the accounting department. The screens are clearly laid out and easily manageable. If a client calls me with a question, I can gather all the information from the client cockpit so I don’t have to call back later.”

He also found the partnership with AGION positive and constructive. “All our requirements were met. And in case we have any questions, we can always get through to somebody at AGION and even call a mobile number if it’s really urgent.’”

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