7 Reasons to implement ERP Software in Automotive industry in 2021

Every successful company in the automotive business sector is usually composed of various teams that work in tandem to successfully run the business. Generally, a service-based automotive company would have an upper management team, a marketing team, a technical team, a finance team and many other such teams depending on the organization’s level (sometimes the same team handles multiple roles). Here, the level of success an organization can reach is based upon the level of synchronicity which each of these teams share. 

Every business, irrespective of its domain is always looking for ways to improve this synchronicity in order to increase efficiency and reduce internal costs. 

To help tackle this, the tech industry developed a software solution which we now know as the Enterprise Resource Planning (ERP) software. This suite of software streamlines and manages all teams efficiently and brings a high level of synchronisation within cross-functional teams. 

This software is more relevant in the service-based automotive industry due to its management and resource-heavy nature. These days, success is determined by the level of deep integration of such ERP software in the Automotive industry.

ERP software

What exactly is ERP software?

By standard definition, “an ERP is usually referred to a category of business management software—typically a suite of integrated applications—that an organization can use to collect, store, manage, and interpret data from many business activities”.

Basically, ERP consists of multiple software programs that are integrated into the core of various sections of a business like marketing, raw material count, finance, etc. ERP generates a common interface to merge all these sub-software programs and gives out a standard dashboard such that the entire operations occurring in a business can be seen by one person.

How will ERP software in the Automotive Service industry be beneficial?

The logic here is simple. As we know that the automotive service industry is highly resource and management heavy, any tool that can streamline and bring efficiency in the working and management operations could significantly reduce internal costs and would make the entire core business more linear in nature. In simpler terms, one could easily manage the various aspects of a service company such as maintaining the inventory of multiple service outlets, managing and keeping track of each employee’s performance, viewing the overall business insights collected from all the business outlets, etc. Overall, ERP’s can give a person the ability to monitor, track and manage an entire franchise from the comfort of their smartphone (if an ERP supports such a feature). 

Secondly, ERPs were notoriously known for their high cost and the time it takes for software companies to develop suitable software for the individual business. This is no more a problem thanks to cloud-based ERP software. Not only are cloud-based ERPs cost-efficient, but they can also be easily integrated into the core of a business in a short duration. Cloud-based ERPs have perfected their game over the years and now, completely removes the need for high-cost custom-built software. The chances of a custom-installed-based software failing can completely be removed with the use of tried and tested cloud-based software.

1. Reducing Operational Cost :

One of the primary benefits of ERP software in the Automotive service industry is that these suites of software can reduce operational cost at various organisational levels. ERP software integrates deep inside the core of an automotive business in a seamless manner. Due to this, the entire business operations can be seen from one place (one dashboard). This will significantly remove the need for training employees, ease the process of resource acquisition and turn the role of management into a child’s play. ERP’s are that effective!

2. Improved business management and tracking on the GO:

ERP software documents a business’ progress efficiently. All the inside work which various departments manually perform are made to do on computers that run the ERP software. This way, every data from each aspect of the industry is stored and documented precisely via the ERP software. Data such as income reports, finance reports, sale reports, etc can be collectively shown at the same time within a single dashboard. This helps in easily tracking business growth and makes measuring performance more accurate.

The latest generation of ERP software comes with mobile dashboards that allow business owners or managers to monitor this dashboard from a single smartphone screen. Smartphones today have dynamically improved in feature compatibilities, owing to which the latest iteration of cloud-based ERPs can integrate the business dashboard into a smartphone screen in the form of Mobile Apps. This way, one can manage and monitor their business even while vacationing abroad. Overall, ERPs today can make sure that business owners need not be physically present to manage their businesses. Thanks to this, one can manage their business with the same level of efficiency using their smartphones as that they could when physically present in the office. 

3. Improved Work Productivity:

ERP software essentially digitizes all the manual paperwork. Going digital is an effective way to reduce the time taken in doing such tasks. From counting inventory to reporting repetitive tasks, ERP covers it all.  ERP software in the Automotive service industry can spot a number of operational redundancies and help digitize them to save time and effort. 

4. Efficient Inventory Management:

One of the prime reasons for integrating ERP software in the Automotive service industry is for effective management of Inventory. Inventory management is usually termed as the most tedious part of running an automotive business which, thankfully, can be made into easy work with the help of ERP software. ERP digitizes the inventory thanks to which, one need not perform tedious manual work in counting and organising inventory. ERP software automatically keeps track of the inventory, thus, notifying the manager whenever the stock is low. This way, one could focus on other important tasks rather than wasting time manually working in the inventory. 

5. Seamless integration of various teams to bring out effective teamwork:

The primary role of ERP software is to bring synchronicity between various departments or teams inside a business. With seamless integration of ERP software into the core of an automotive service business, various teams can be combined and software products can be discarded. For example,  automotive service business operations such as supply chain, Customer Relationship Management (CRM), management team, the finance team can all be managed from a single ERP software’s dashboard. With an ERP, one could cut down the cost it requires to own multiple single-purpose solving products such as CRM, Accounting software, etc.   

6. Compliance with automotive regulations are made easy:

Any automotive company has to comply with various automotive and security laws such as the Federal Information and Security Management Act, Sarbanes-Oxley Act, etc. These can be tough to understand and comply with. But, by using ERP software that has specific modules built to cohere with such laws, one can easily march past this obstacle. ERP software will automatically comply with the laws and build the necessary company reports that are required to be submitted to relevant regulatory bodies.

This list gives a broad and generalised idea of ways in which businesses can benefit from using ERPs. The level of benefit which each company can derive is based upon the company’s structure. With ERPs, any automotive business, from service-based to even manufacturing-based, can start making higher profits and the business managers or owners can manage the entire business with much ease. 

Conclusion

Arguably, deciding whether to implement ERP into one’s business can be hard, especially considering the initial price. You need to clearly have a set of criteria to make a proper decision.

  1. The time it takes to implement the ERP into the business. (phase-wise implementation)
  2. Clear cost to benefit comparison (ROI).
  3. Software compatibility with the business.
  4. ERP training  
  5. Future scope of improvements/ how frequent are the updates?

In fact, today’s iteration of cloud-based ERP solution makes the decision process even easier to make, unlike custom-built install-based counterparts. Cloud-based ERPs can easily fulfil all of these important criteria. 

ERPs have revolutionised the way in which an automotive service business performs. The level of efficiency, department linearity, time and cost-saving has helped business push towards their peak performance and profitability. 

Now, as a person, if you’re looking to implement ERP for your automotive service business, consider talking to our team of experts at GaragePlug, Chat with us.

Our experts can help assess your organisation and guide you towards implementing the cheapest yet most effective ERP solution for your business. 

A new auto repair shop also needs to be prepared for all unexpected situations that may arise during daily operations when the business starts running. These may include dealing with customers who do not pay on time, managing leaves and time offs of workers and preparing for the peak and slow times in a business. Some of the experience of dealing with these things may come from situations while running the operations.

 Auto repair shop building cost is different for each business and it is up to the business owner to plan things in such a way which ensures maximum profits and minimum costs. Opening an auto repair shop of your own is not a simple task and various nuances to it which owners should quickly understand. It is important for them to figure out what kind of services and customer segments they want to target in advance before they start constructions on a full swing. A business owner should be open to new ideas and should constantly adapt with the changing situations in order to become successful.

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