Manufacturing ERP Handbook

A Guide to Selecting the Right ERP Software

for Your Industry

SELECT THE PERFECT ERP SOFTWARE FOR YOUR BUSINESS

There are hundreds of ERP applications available today. Each has strengths and weaknesses. Some
are specialized by industry, while others are more general. Some systems work better for smaller
manufacturers, and others scale up for larger, multi-site manufacturing operations.

Established ERP applications provide robust features built on aging platforms that are challenging to
integrate with modern business technologies. Newer products built for the cloud and connectivity
provide a modern platform for growth with streamlined features providing simplicity, flexibility, and mobility.

Manufacturers have options including ERP systems designed for configure-to-order, engineer-to-order,
make-to-stock, and other production methodologies.

This ebook provides a framework to understand manufacturing ERP options. Manufacturing

methodology and industry profiles highlight vital features to consider when evaluating your next
manufacturing ERP application.

FIND THE RIGHT MANUFACTURING ERP SOFTWARE

DISCRETE VS PROCESS PRODUCTION METHODOLOGY ERP OPTIONS

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GENERAL ­FEATURES INDUSTRY ­FEATURES ACUMATICA ERP

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 DISCRETE VERSUS PROCESS

Two Distinct ERP Options

There are two fundamental categories of manufacturing ERP—discrete and process. Both
provide similar accounting, inventory management, purchasing, and order management
features. However, they provide entirely distinct manufacturing functionality. Acumatica is
one of the few ERP systems that support both discrete and process on a single platform.

Discrete ERP software centers on a bill of material comprised of solid materials formed
or assembled into a finished good. Recipes or formulas are the cornerstones of process
ERP systems where liquids, powders, or gases are mixed, blended, or combined to create
finished goods. The table below highlights the key differences between discrete and process
ERP systems.

Hear Acumatica customer stories on how manufacturers

Watch Videos
rely on Acumatica for their success.

DISCRETE ERP PROCESS ERP

Disassembly It is easy to disassemble finished goods It is difficult or impossible to disassemble
back into the original bill of material finished goods into the original
components. ingredients.
Structure Bill of Material Recipe or Formula
Materials Solids Liquid, Powder, or Gas

Operations Cut, bend, drill, assemble, mold, bore, Blend, mix, react, cook, reduce, hydrate,
ream, weld, etc. dehydrate, infuse, etc.
Quality and Limited lot and serial tracking. Minimal Significant quality and compliance
Compliance industry quality regulations such as ISO, including lot attributes, hazardous
21 CFR Part 820, and more. materials, safety data sheets, EPA and
FDA regulations, and more.
UOM Typically managed in limited discrete Managed in multiple units of measure
Packaging units of measure (each, pound, feet, etc.). with complex UOM conversions and
Simple product packaging. intricate packaging requirements.
Other Engineering change orders, product Yield and loss, specific gravity, catch
Features configuration, estimating, weights, concentrations, potency,
installation, more. expiration dates, more.
 PRODUCTION METHODOLOGY

Manufacturing Methodology Impacts ERP

Every manufacturer is different, even if they make the same product. For example, two
manufacturers make fasteners. The first makes general-use fasteners to stock at low prices.
The other makes expensive, custom fasteners to order for the nuclear industry. The first
manufacturer relies heavily on demand forecasts to drive MRP. They maintain safety stock
levels to avoid stock-outs, and they manage engineering revisions for standard products. The
second manufacturer relies on estimates and win percentages for material planning. They do
not stock finished goods. They track fasteners by lot with attributes such as heat numbers
and chemical composition.

Every manufacturing ERP system supports different production methodologies. Some are
stronger for make to stock while others are specialized for make to order. The following
production methodologies and features are available in specialized ERP applications.

CHEMICALS AND FABRICATED METAL PRODUCTS

“Acumatica provides all the fundamentals needed to run your business, so

when you are ready to take the next step and expand or move into a new
market, there are strong systems and processes in place to take that on.”

-K
 EVIN BOYLE, DIRECTOR OF IT View Success Story
SPECIFIED TECHNOLOGIES INCORPORATED

MAKE TO STOCK (MTS) MAKE TO ORDER (MTO)

MTS is a manufacturing philosophy where finished MTO manufacturers rarely stock finished goods.
goods are produced to stock. Existing stock fulfills Instead, manufacturing is scheduled to fulfill direct
customer orders as opposed to fulfillment from customer orders. Variants of MTO manufacturing
manufacturing. Manufacturing proactively maintains include ATO, CTO, ETO, and Job Shop manufacturing.
adequate stock levels for forecasted customer orders.
• Estimating
• Demand Forecasting • Vendor Request for Quote (RFQ)
• Inventory Replenishment • CAD Bill of Material Integration
• Engineering Change Orders • Job Costing
• B2B or B2C Commerce • Product Configurator
ASSEMBLE TO ORDER (ATO) ENGINEER TO ORDER (ETO)
ATO manufacturers assemble components to fulfill ETO manufacturers design products based on
customer orders. ATO companies rarely stock customer specifications. Assemblies and raw materials
finished assemblies. They have simple processes are stocked, but they are not assembled until a
customer order is received, and the part is designed
and production requirements.
by engineering.
• Demand Forecasting
• Engineering Change Orders
• Kitting and Disassembly
• Vendor Request for Quote
• Light Manufacturing
• CAD Bill of Material Integration

CONFIGURE TO ORDER (CTO)

MIXED MODE (MM)
CTO manufacturing generates unique finished goods
Mixed-mode manufacturers produce finished
using a rules-based product configurator to define
goods both to stock (MTS) and to order (MTO).
the bill of materials and routing based on options and
Also, companies that operate discrete and process
values such as color, size, or other variables.
operations are sometimes called mixed mode.
• Product Configurator
• Demand Forecasting
• B2B or B2C Commerce
• Engineering Change Orders
• Matrix Items
• Bill of Materials and Recipes or Formulas

REMANUFACTURING (REMAN)
JOB SHOP
Remanufacturing relates to “cores” or worn parts
Job shops have minimal raw materials and finished
repaired for resale. Remanufacturing is common for
goods inventory. Most orders begin with an estimate.
transmissions, batteries, furniture, toner, and other
Job shops purchase materials directly for customer
products. Recycling and disassembly are a form
orders. True job shops do not stock finished goods.
of remanufacturing where products are broken
Job shops ship directly from work in process to the
down into salvageable components.
customer.
• Disassembly
• Estimating
• By-products and Co-products
• Vendor request for quote (RFQ)
• Core Management
• Job Costing

FABRICATED METAL PRODUCTS

“Acumatica gives us the capability to provide PO’s, available raw material,

and manufacturing modules to provide accurate available for sale inventories,
including all pertinent costs.”

-Y
 URI DUROVSKIKH, IT MANAGER View Success Story
OFS INTERNATIONAL
REPETITIVE / CONTINUOUS FLOW BATCH PROCESS
Repetitive Manufacturing (REM) is the production of Batch process manufacturers use formulas, recipes,
goods in rapid succession. Repetitive manufacturing and batches as opposed to a discrete bill of materials
goes together with automated assembly. It is common and work order. The formula or recipe is either a
when producing a standard product for a model year discrete quantity or a percentage of the batch. Process
such as appliances or automotive products where manufacturers have many variables for production,
there is a known or expected demand for the period. including potency, specific gravity, concentration, and
Many repetitive manufacturers operate assembly lines strength. Acumatica natively supports batch order
or fixed work centers where the same product is made types, lot tracking, picking by lot expiration date,
continuously. Scheduling by the item is common. and many other process manufacturing business
Materials are often backflushed at standard quantities requirements. Other process manufacturers use
and costs. Repetitive and continuous flow manufacturing partner applications that extend Acumatica with
often relies on Master Production Scheduling (MPS) and more advanced process manufacturing features.
Rough-Cut Capacity Planning (RCCP).
• Formulas or Recipes
• Demand Forecasting • Scalable Batch Orders
• Material and labor backflush • Loss / Yield Reporting
• Engineering Change Orders • Lot Tracking with Attributes
• MPS and RCCP • By-products and Co-products
• Scheduling by Item

PLASTIC AND RUBBER PRODUCTS

“By utilizing the manufacturing edition of Acumatica, we were able to

determine verifiable product costs that allowed us to put together a pricing
model. This increased our gross margin percentage dramatically.”

- PAT
 TREFUN, CFO
OPFLEX ENVIRONMENTAL TECHNOLOGIES View Success Story

PROJECT-CENTRIC LEAN MANUFACTURING

Project-centric manufacturers build, schedule, and Lean manufacturing minimizes waste in both materials
cost complex products in phases. This is common in and processes. Lean manufacturing often uses
aerospace and defense, capital equipment, and other just-in-time pull systems to shorten lead times,
labor-intensive industries. reduce operating costs, and improve product quality.

• Project Management • Kanban (Toyota Production System)

• Product Configurator • Single Minute Exchange of Dies (SMED)
• Engineering Change Orders • Poka-Yoke (Error-Proofing)
• CAD and PLM Integration • Value Stream Mapping
 ERP OPTIONS

Specialized or General? Large or Small?

Manufacturing ERP software comes in many shapes and sizes. Smaller manufacturers use
accounting applications like QuickBooks with plug-ins for manufacturing or entry-level ERP.
These low-end applications historically support make to order with minimal functionality
for make to stock. As manufacturers grow, they move to more robust midmarket ERP
applications like Acumatica.

Some ERP systems are specialized for engineer to order, configure to order, and lean manufactur-
ing. Other systems focus on repetitive, remanufacturing, job shop, or batch process manufacturing.
Further, the ERP market provides specialized industry ERP applications and broader, general
manufacturing ERP applications. The table below compares each type of ERP system.

ELECTRONICS AND ELECTRICAL PRODUCTS

“Without the Acumatica suite, we would certainly not have gotten ISO-certified
. . . We framed our entire quality management framework around Acumatica,
from document management to update processes.”

- NATHANIAL FAIRWEATHER, MANAGING DIRECTOR

View Success Story
TRIODE GROUP LIMITED

INDUSTRY ERP GENERAL ERP

Technology Generally, older technology. Typically, modern technology with

Difficult to integrate. easy connectivity.
Business Features Simple accounting with limited Strong accounting with advanced
business management. business management features.
Manufacturing Specialized industry features. General manufacturing with limited
industry-specific features.
Customization Few customization or Stronger customization and
personalization tools. personalization tools.
Services Direct consulting and support Multiple consulting and support
provided by the ERP vendor. Few, options including partners and
if any, other options. independent consultants.
 GENERAL ERP FEATURES

Standard Features Across ERP Systems

Today’s ERP systems represent a homogenous collection of features that evolved from the
industry’s best ideas. As a result, most ERP systems provide similar functionality with as little
as 10 to 20 percent difference between applications. The following are features common in
midmarket ERP applications. However, the way that each feature is supported is often
different. Manufacturers must pay careful attention to detail to differentiate between systems.

SPORTING GOODS, TOYS, AND HOBBY

“Acumatica helps us better analyze our sales and gives us the ability to
analyze more categories with much more clarity . . . We have a lot more real-
time visibility into what other entities are doing, which allows me to be more
effective and keep better tabs on what’s going on and helps us make more
strategic financial decisions.”

-F
 RANKLIN SHIRAKI, CORPORATE CONTROLLER View Success Story
FIREWIRE SURFBOARDS

PLATFORM AND TOOLS ACCOUNTING

Every ERP system has multiple levels of Every manufacturing ERP system provides
database and user security and some general ledger, accounts payable, accounts
capability to customize screens. Most systems provide receivable, and bank management (i.e. cash
user-defined fields (UDF). UDF functionality varies management or bank reconciliation). However,
widely between applications. Most ERP systems also functionality varies widely for specific features in
provide import and export utilities to manage data. these modules. For example, some ERP systems are
Most ERP vendors restrict access to source code or restricted to a limited number of account segments,
charge fees for source code. All ERP applications and others do not support national or parent accounts
provide reporting and inquiry tools. Mobile applications or budgeting. Multi-company and multi-currency
are critical for many manufacturers, especially for support are other common features. However, not all
remote field service. Help files are available for all major ERP systems support inter-company features. Nor do
ERP applications. Few systems offer customizable all systems provide tools for allocations or financial
help in the form of built-in wikis. Support for multiple consolidations. Project accounting, fixed assets, and
languages and localization for international regions payroll are provided natively or through third-party
varies widely across ERP applications. applications.
SALES PURCHASING
All manufacturing ERP applications provide Purchasing includes blanket orders, receipt
sales orders. Most systems support of goods processing, and put-away features.
drop-shipments, returns and exchanges, blanket Other common features include landed costs, FOB
sales orders, sales commissions, quotes, and CRM. definitions, vendor returns, and bar code scanning.
Commerce integration is available in most ERP systems Few systems like Acumatica natively support
with connections to leading commerce platforms. purchase order requisitions with approvals workflows.
Retail point of sale (POS) and rental software are Those that do support requisitions often provide
available with many ERP systems. Other common tools for vendor request for quote (RFQ) bidding
sales features include shipping, pricing, backorder processes.
management, and labeling.

MANUFACTURING
INVENTORY Every manufacturing ERP system supports
Standard inventory functionality includes either bill of materials and routings or a
stock and non-stock item management with formula or recipe. Material issues and labor entry
unit of measure definitions, pricing, and packaging. with backflushing automate data entry. Work orders
Common inventory management features include or batch orders capture costs and transactions
physical inventory, warehouse transfers, and ABC for work in process. Other core features include
Codes. Many also provide country of origin and phantom bills of material, advanced planning and
advanced replenishment based on safety stock, lead scheduling, material requirements planning, and
times, reorder points, economic order quantities, engineering change orders. Make to order ERP
or min/max stock definitions. Kitting, disassembly, systems support manufacturing estimates. Some
barcoding, and labeling are also common. Lot and systems provide rules-based product configurators
serial tracking, expiration dates, and inventory and demand forecasting. Many systems also provide
allocation for orders are less common across a light manufacturing module for fast, after-the-fact
applications. Most systems support average and production reporting. Advanced capabilities such
standard costing and inventory valuation. Some also as manufacturing execution systems (MES), product
support FIFO, LIFO, and actual or specific (lot-based) lifecycle management (PLM), and Quality Management
costing and inventory valuation methods. vary across ERP systems.

NONMETALLIC MINERALS

“When we talk about Acumatica, it’s not just about accounting but about where
we do all our business. We work in Acumatica and don’t need to leave.”

-S
 COTT STARKWEATHER, PRESIDENT
View Success Story
BOULDER CREEK STONE
 INDUSTRY FEATURES

Specialized ERP Features by Industry

Manufacturing ERP is available from larger, general publishers, and smaller publishers focused
on specific industries. General ERP solutions support multiple industries with strong cross-
functional processes and applications. General ERP systems offer more specialized features
today than ever before. Smaller ERP vendors focus on niche industries with specialized
systems. Manufacturers must choose between the two options. Below is an overview of
features common for each industry segment.

APPAREL, LEATHER, AND JEWELRY

“Having the entire ecosystem all together allows us to run more definitive
reports and we can move forward based on that data rather than spending
time going to multiple applications to verify the data.”

- STEVE CATES, PRESIDENT, RAY ALLEN MANUFACTURING (PRIOR) View Success Story

FOOD AND BEVERAGE APPAREL, LEATHER, AND JEWELRY

Manufacturers of food and beverage products Matrix items are an essential requirement for
can be either discrete or process. They may textile, leather, apparel, and jewelry products to
require batch processing, lot tracking, and recipe or manage pricing and availability across product families
formula management. Catch weights, unit of measure where style, color, and size combinations are difficult
conversions, expiration dates, and variable product to manage. Commerce integration, retail sales, and
packaging are also common. Route management for product configuration are also popular. PLM is also a
direct store delivery (DSD) is required for some businesses. major requirement.

CHEMICALS AND LIFE SCIENCES WOOD PRODUCTS

Chemical, petroleum, pharmaceutical, Few ERP systems support the wood, lumber,
coatings, cosmetics, and similar businesses and building products industry well. Features
are predominantly process-based. Batch production, such as matrix items are useful for managing items
formula and recipe management, and lot tracking with slight variations such as dimensions or grade.
are essential. Advanced features include potency, Other requirements common in the industry include
concentrations, specific gravity, and yield and loss co-products, by-products, lot tracking, and point of
tracking. Compliance for the EPA, FDA, and other sale for in-store sales.
regulations are also common.
ADDITIVE MANUFACTURING (AM)
Additive manufacturing is the process of building products by printing layers of materials on top of one another
to create parts. Advances in 3D printing have lowered costs and improved product quality. AM system may be
integrated with ERP applications to capture material costs, scrap quantities, process times, and finished goods
quantities. Look for ERP systems with strong integration tools and Open APIs to ensure your system is ready to take
advantage of new manufacturing technologies like AM.

FURNITURE AND HOME GOODS PAPER PRODUCTS

Product configuration is a must-have for most Paper product manufacturers include paper
furniture manufacturers. Commerce and retail sales mills and manufacturers of cardboard, envelopes, and
are also increasingly common for manufacturers of publications. Paper mills have specialized requirements
furniture and home goods. Other requirements include best suited for process-oriented ERP systems. There
CAD or PLM integration and serial tracking. are specialized ERP systems for the publishing industry
to manage writing and layout for books and magazines.
Other companies in this industry rely on general
PLASTIC AND RUBBER manufacturing ERP systems for basic manufacturing
Lot tracking, co-products, and by-products capabilities.
are a major concern for plastic and rubber
products manufacturers. They require traceability
for regrind for recovered material and often schedule NON-METALLIC MINERALS
production by color to reduce clean-up between Manufacturers of stone, clay, glass, concrete,
production runs. tile, and other products commonly need lot
traceability. Dimensional inventory and matrix item
requirements are also common. Other requirements
FABRICATED METAL PRODUCTS include lot attributes, co-products, by-products, and
Many fabricated metal product manufacturers commerce integration.
rely on manufacturing estimates. Stamping
operations have co-product requirements. Open APIs
and integration tools must support machine integration INDUSTRIAL EQUIPMENT
for data capture. Other requirements include lot Industrial machinery manufacturers rely
tracking, job costing, and outside processing. heavily on serial tracking, engineering change orders,
Integrated CAD for bill of material management with CAD and PLM integration, and product configuration.
engineering change orders are popular in some Many also require warranty and service management
businesses. for installation and repair.

PRIMARY METAL PRODUCTS

“The leadership team of any small or medium business considering an ERP system
is doing themselves a great disservice if Acumatica isn’t on their list to investigate.”

-B
 RAM KLEPPNER, CEO, DANFORTH PEWTER View Success Story
 FOOD AND BEVERAGE PRODUCTS

“We’re currently using the full end-to-end suite, including raw material
procurement, manufacturing, supply chain, and obviously all the associated
financial functions . . . I would definitely recommend Acumatica to other
businesses. It covers the full ERP functionality, it integrates with other products
well, and it’s cost-effective.”

-D
 EREK SZABO, MANAGING DIRECTOR View Success Story
DEVIL’S PEAK BREWING COMPANY

ELECTRONICS AND ELECTRICAL PRIMARY METALS

Engineering change orders and integration Primary metal manufacturers depend on
with CAD and PLM applications are crucial for lot tracking and often use lot attributes
electronics, electrical, and high-tech manufacturers. to manage lot characteristics such as heat numbers,
Product configuration and commerce are both mill certifications, and quality results. Tool and
common for commercial and consumer products. Serial die management is also crucial for scheduling and
and lot tracking and warranties are common as well. production management.

AEROSPACE AND DEFENSE INSTRUMENTS AND

Manufacturers of aerospace and defense MEDICAL DEVICE
equipment have complex requirements for Instrument manufacturers have similar
work breakdown structure (WBS) reporting with progress requirements to electronics and electrical manufacturers.
and milestone billing. Compliance with DCAA and ITAR is Medical device companies face increased requirements
partially supported by ERP data. Additional requirements to comply with 21CFR Part 820 for security and data-
include engineering change orders, TBLP (transfer/borrow- base audits.
loan-payback), and material requirements flow-down.

OTHER INDUSTRIES
AUTOMOTIVE AND Tobacco and cannabis manufacturers face
TRANSPORTATION stiff regulatory compliance. Sign manufacturers
Repetitive, cellular, and lean manufacturing are common often have serial numbers. Toy and hobby manu­
in the automotive industry. Cumulative demand forecasts facturers sell online via B2B or B2C storefronts.
and EDI are prevalent. Serial tracking and warranties are Non-manufacturing industries including distri-
essential for component traceability to vehicle identifi- bution, agriculture, forestry, fishing, mining, and
cation numbers (VIN). Project management applications other industries often choose manufacturing ERP
help manage programs. Kanban, quality, and engineering ­applications like Acumatica as the foundation for
change orders are also prevalent. their businesses.
 ACUMATICA MANUFACTURING EDITION

Manufacturing ERP—The Acumatica Way

Manufacturers across industry segments rely on Acumatica Manufacturing Edition to
maximize resources, reduce costs, and improve profits. An extensive suite of connected
and mobile business applications provides unparalleled manufacturing depth for
production, estimating, engineering, material planning, scheduling, product configuration,
and manufacturing data collection.

Last-mile features such as disassembly, engineering change control, demand forecasting, and
outside processing streamline critical manufacturing processes. Acumatica supports make
to stock, make to order, batch process, and other manufacturing methodologies. Project
Accounting provides project-centric manufacturers with a comprehensive production and
resource planning system.

Commerce and mobile field service extend Acumatica for manufacturers who sell online or
provide on-site services. Balance supply and demand with inventory, sales, and purchasing
on top of a comprehensive suite of accounting applications. Leverage automation, workflows,
and document management to connect data and processes throughout all parts of the
manufacturing business for improved customer service, customer retention, and growth.

Acumatica provides ease of use and rapid integrations to connect modern technologies,
including cloud computing, big data and analytics, additive manufacturing, robotics, and
the Industrial Internet of Things for streamlined processes and meaningful insights into
manufacturing operations.

Acumatica Cloud ERP provides the best business and industry management solution for
transforming your business to thrive in the new digital economy.
Acumatica Manufacturing Edition
Engineering Change
Multi-Level BOM Phantoms Control**

Fixed and Variable Visual BOM Reference

Overhead BOM Comparison Designators

Labor and Backflushed and Direct Purchase / Transfer

Material Tracking Labor / Material Costs Full Regeneration Recommendations
Bill of
Materials
Lot / Serial Tracking Project Manufacturing Sales Forecasting MRP Buckets

Production MRP
Barcoded Data and Costing Master Production
Outside Processing Multi-Site Planning
Collection** Schedule

Acumatica
Manufacturing
Edition
Finite Capacity Rough Cut Capacity Sales and Opportunity
Scheduling Planning Planning Rules Based
Product Integration
and
Scheduling Configurator
Machine and Work Center Machine and Tool Supplemental Items Features and Options
Capacity/Utilization Scheduling
Estimating

Projects Hard Allocations Price and Cost Rollup Configure from Portal

Fixed and Variable Auto-Create

Revision Control
Overhead Inventory Items

Sales and Opportunity Create from Existing Include Non-Inventory

Integration BOM Items **Additional Modules
Adaptable Manufacturing
Industry ERP with Acumatica
Selecting the right ERP system for your business is difficult
with hundreds of manufacturing ERP options. Should you
partner with a larger publisher with a strong top-down
ERP system or should you implement an industry-specific Carrying a multi-million-
ERP from a smaller publisher? Does the system support
dollar inventory, you’ve
your manufacturing methodologies and industry-specific
requirements? got to have good
Acumatica Manufacturing Edition provides unparalleled
controls for that . . .
manufacturing depth for production, estimating, With the new controls
engineering, material planning, scheduling, product that Acumatica has in
configuration, and manufacturing data collection. Robust
accounting and connected project accounting, field service, place, our inventory is
and commerce extend the system for other business areas. much more accurate.”
Acumatica supports make to stock, make to order, and batch – ROGER COLLINS, CFO,
manufacturing methodologies making it a popular choice for DEMTECH
companies across industry segments.

Acumatica Manufacturing Edition provides ease of use and

rapid integrations to connect to modern technologies,
including cloud computing, big data and analytics, additive
manufacturing, robotics, and the Industrial Internet of Things
for streamlined processes and meaningful insights into
manufacturing operations.

For more information please contact:

Crestwood Assocates LLC
www.crestwood.com
sales@crestwood.com
(847) 394-8820