MRP vs. ERP: Why Growing Manufacturers Outgrow Spreadsheets
Manufacturing Happy Hour
This episode of Manufacturing Happy Hour, sponsored by MRPeasy, is aimed at manufacturers with roughly 10 to 200 employees who still run their businesses on spreadsheets. Host Chris Luecke talks with Shane from MRPeasy and Sarah from Smart Manufacturer, an independent consultancy that implements the software. They cover three questions: how MRP differs from ERP, what problems push small manufacturers to change systems, and what happens after they do. Both guests argue that many small manufacturers who think they need an ERP really need an MRP system, and that the software pays off only when leadership and staff are ready to change how they work.
What the two guests do
Chris asked each guest to describe their work as if talking over a pint in a pub. Shane described MRPeasy as manufacturing software that connects the main parts of a manufacturing operation: sales, production, inventory and procurement. All of a business's manufacturing information sits in one place, and a change in one department updates automatically across the system.
Sarah described Smart Manufacturer as an independent manufacturing consultancy and ERP specialist focused on small and mid-sized manufacturers, the same market MRPeasy serves. She put the firm's mission as helping companies "work smarter, not harder." In her view, many small manufacturers try to grow by working ever more hours, and there are only so many hours in a day. Her firm helps them streamline and automate their end-to-end workflows so they can work more efficiently and scale more easily.
The difference between MRP and ERP
Chris asked Shane to explain the difference first, since the terms are often used interchangeably. According to Shane, ERP (enterprise resource planning) covers the whole business. Large organizations typically use it to connect every department, including sales, HR and accounting, plus manufacturing operations if they are a manufacturer. MRP follows the same idea of connecting parts of the business but focuses on manufacturing. In MRPeasy's case that means sales, inventory, production, planning and procurement.
Shane added that the two categories overlap. MRPeasy integrates with accounting platforms and CRMs, so in some ways it can do what ERP software does.
Chris suggested that an MRP system contains the core functionality a small or mid-sized manufacturer would need from an ERP. Shane partly agreed but corrected one point: large businesses also use MRP systems, so MRP is not only for small companies. His main point was that many small manufacturers searching for ERP software probably need MRP software, because what they are really trying to manage is their manufacturing.
The challenges that drive manufacturers to change
Shane said the main problem he sees among companies coming to MRPeasy is that they have outgrown their current systems. He described MRPeasy's ideal customer as a small manufacturer with around 15 employees. The business has started to grow, and the spreadsheets and manual processes it began with no longer work. Staff spend more time on admin and firefighting and less on work that grows the business.
He singled out two kinds of visibility. The first is inventory. Companies don't know what materials they have or whether they have enough to make a product. That leads them to over-promise delivery times, which causes late orders and unhappy customers.
The second is cost. Shane said many small manufacturers don't know what it costs to make their product. An MRP system can show material costs, labor costs and machine hours, which gives a clearer view of true product cost and directly affects profit. His example was a recent MRPeasy case study with a food manufacturer he believed was based in Indiana. When ingredient prices rose or suppliers changed their prices, the company checked its costs in MRPeasy and adjusted its recipes to bring costs down.
Labor shortages and new legislation in the UK
Sarah added challenges from the UK market, starting with access to new workers. She pointed to an aging workforce and said Make UK, which she called the country's largest established trade association for small manufacturers, quotes the average age of people working in small manufacturing at about 52. She said she has seen many companies with employees much older than that. She also described a perception problem: it is hard to get younger people excited about working in UK manufacturing.
She also mentioned new employment rights legislation that, in her view, makes life harder for manufacturing leaders. Sarah said these pressures are pushing even established businesses to manage their operations differently and look at automation. She described MRPeasy as often the first step on a "digital ladder": moving away from manual processes and spreadsheets and getting everyone onto one system that provides what ERP practitioners call a "single version of the truth."
Chris said about 80% of the show's audience is in North America, and that many US manufacturers feel the same pressures. He named navigating policy and, above all, labor shortages as common themes.
Being first to market with cloud-based MRP
Chris asked Shane about MRPeasy's history, noting that Shane was not at the company at the time. Shane said MRPeasy launched in 2014 as the first cloud-based MRP system. As he understands it, nothing on the market then gave small businesses MRP functionality. The larger systems were expensive, and the founders saw a gap for an MRP system that small manufacturers could access and afford.
Being first had a downside. There were no competitors, but many potential customers didn't know such software existed or that a cloud-based MRP system for small manufacturers was even possible. Shane said this caused some hesitation, so building trust early was essential. According to Shane, the company did this by offering a product that worked at very low prices and keeping prices extremely low for several years until it broke even. Only then did it promote MRPeasy more heavily and attract more customers. Today many competitors offer cloud-based MRP. Shane said affordability for small manufacturers remains part of the company's original vision.
Chris noted that running a business in the cloud was seen as risky ten years ago. He also recalled that the company was bootstrapped rather than raising a lot of funding up front, and suggested this gave it flexibility. Shane agreed.
A CNC machining shop on the edge of burnout
Chris asked Sarah for one of the most painful spreadsheet-driven scenarios she had seen. She described a typical CNC machining shop founded in 2017 that served aerospace, defense, medical, and oil and gas. It had two directors. One ran sales, and the other ran everything else on the production and operations side. Sarah noted that both were young, not people in their fifties, which is part of why the case stuck with her.
Everything ran on manual spreadsheets, and jobs were scheduled and rescheduled on a whiteboard. The operations director walked Sarah's team through the process:
- He created a quote and matched it against a quote tracker.
- He sent the quote manually.
- He re-keyed the same information into the order.
- He cross-checked the order against an order tracker.
Meanwhile, he also had to go onto the shop floor, make sure the team knew which jobs to run that day, and find out why any machines were standing idle.
Sarah said that after only half a day there she felt stressed herself, so she could imagine what he was under. He told her he had no visibility into where jobs were or what they were costing him, so he couldn't use that information to make operational changes. Sarah said she could see physical signs of stress. She believed that unless something changed and a system was put in, he was headed for personal burnout. That combination of business and personal consequences is why the case stays with her.
The hidden costs small manufacturers overlook
Chris asked which operational problems quietly cost small manufacturers the most without their realizing it. Sarah listed three.
Duplicate data entry. Time spent copying and pasting the same information across multiple spreadsheets is a real cost.
Under- and overstocking. Overstocking ties up cash unnecessarily. Understocking, she said, is worse. In several implementations, when her team reviewed how a company managed inventory, the company had not set minimum or maximum stock levels for small parts like screws and washers because they seemed too cheap to matter. Sarah said they are cheap per unit, but if a job starts and those components are missing, the delayed order can be expensive.
Unmeasured scrap and defects. Companies often tell her a defect "occurred in production," but nobody measures it or does root cause analysis. It is treated as something that happens from time to time. Sarah said this leaves open how often it happens and what it costs.
A fire door seal manufacturer after implementation
For a success story, Sarah described a family-run manufacturer of intumescent fire door seals, a niche market. The company started in 2021, but the family had about 30 years of experience in similar businesses. It had about 23 employees at the time.
Before implementation, the company worked very traditionally. It had three separate Excel trackers, two for production and one for packaging, and only one production manager could enter information into them. Paper job sheets went out to the floor. There was no information on what jobs cost. When customers asked where their job was in production, admin staff had to run around the factory to find out. Sarah hesitated to call it chaos but said there was a clear lack of visibility.
The managing director, who has since retired, wanted to leave the business in very different shape. When Sarah introduced MRPeasy, the company was skeptical. She said the MD expected an ERP or MRP system to cost "an arm and a leg" and worried it would be excessive for a business their size. After explaining how MRPeasy differed, the company ran a trial, found it was not what they expected, and went ahead with implementation supported by Smart Manufacturer.
According to Sarah, based partly on a recent case study with the sales director who sponsored the project:
- One system instead of three trackers. Every function now works from a common set of information in MRPeasy, replacing the Excel trackers and paper work cards.
- Shop-floor access. Staff use MRPeasy on the floor through desktop systems and rugged mobile devices.
- Cost and scrap tracking. They capture actual costs and scrap. Scrap was an area the former MD specifically wanted to track so the business could keep improving.
- No more running around. Nobody has to walk the factory to answer customer questions.
- Delivery performance. OTIF (on time in full, meaning deliveries go out as planned and complete) is now consistently above 99%.
Sarah called the most striking result the growth. A year after going live, the business had grown by just over 25% while adding only a couple of people. In her view, without MRPeasy it would have had to increase headcount significantly.
Chris said the case showed how much such an investment can change a business, attributing the growth to better visibility, faster throughput, and people understanding what others in the business were doing. He added that the broader lesson goes beyond MRPeasy: taking deliberate action can transform even a manufacturer with 20-some employees.
What successfully scaling manufacturers have in common
Chris asked Sarah what manufacturers that scale well have in common beyond software. She named five traits.
Focus. Instead of doing everything they have always done, only bigger and faster, successful companies identify their most profitable product types, customer segments and possibly geographies, and concentrate on those.
Strong leadership. Leaders need a solid grounding in manufacturing, but also have to communicate effectively and build teams.
An open mindset. Sarah said her consultancy looks for this in deciding where it can make a difference. Rather than fearing that a new system means too much change to lead, good leaders are open to doing things differently. They may not know exactly how, but they believe the right people and technology will get them there.
Investment in people. Technology and streamlined processes are necessary, but Sarah described implementing a system as a change management program. Staff must be engaged from the start and understand how the technology will change both the business and their own roles. She said her consultancy puts a lot of emphasis on bringing people along.
Continuous improvement. Successful companies treat scaling as ongoing, not a one-time destination, and keep looking for new processes and technologies. Sarah said MRPeasy's open API allows it to sit at the core with specialist applications integrated around it.
Self-implementation and the role of partners
To close, Chris asked Shane what he wished they had discussed. Shane chose implementation. He said one of the biggest misconceptions about MRP systems is that they are very expensive to implement, and that this, plus licensing fees, keeps many small manufacturers from considering them at all.
Shane said MRPeasy addresses this in three ways:
- Low licensing fees.
- An extensive user manual that lets a small business owner learn everything needed to implement the software alone.
- An AI chatbot trained on the manual, which answers questions about how the software works, including what it can and cannot do.
There is also a customer success team whose role is to educate users on the software's capabilities. Shane was clear that this team does not go into the business. It explains how the software works and helps customers implement it themselves.
He said self-implementation is central to MRPeasy's approach. Many customers, though, are too busy running their businesses to do it themselves, and for them MRPeasy works with partners like Sarah. The conversation ends there: small manufacturers can set up the system on their own with the tools Shane described, or bring in an implementation partner.
It's those that are open to maybe looking at them, maybe a different way of doing things. They may not know exactly how to do that, but if I bring in the right people and the right technology, I can achieve it.
If you're a manufacturer that's running your business on spreadsheets and has between 10 and 200 employees, this episode is for you. Manufacturing Happy Hour's sponsor, MRPeasy, is helping manufacturers improve their visibility to inventory and costs. Today, we'll discuss the differences between MRP and ERP, get into some of MRPeasy's background as a company, and then dive into some case studies covering what happens when manufacturers finally stop running their businesses on spreadsheets.
Shane and Sarah, good to have you here on Manufacturing Happy Hour. Let's say we're hanging out over in Europe right now, over a pint at a pub. Shane, we'll start with you. How would you describe what MRPeasy does as if you're having a drink with someone?
Yeah, so basically, if I had to explain MRPeasy in the simplest way possible, I would say it's manufacturing software that connects different parts of manufacturing operations. So, that's sales, production, inventory, and procurement. So, basically, it's a system where a business can have all of its information related to manufacturing in one place. All the data is connected. So, when data changes in one department, it's automatically updated across the system.
And we're going to dive deeper into the system, but we're also going to talk about implementation today, which, Sarah, as I understand it, that's where you come into the equation at Smart Manufacturer. So, similar question for you. How do you describe what you do as if you're having a drink with someone?
Yeah, so we are an independent manufacturing consultancy and ERP specialist. We focus very much on the small-to-midsize manufacturing sector, so exactly the space where MRPeasy plays. For us, it's all about helping companies to work smarter, not harder. So, there's a lot of small manufacturing companies on this big conveyor belt to how can they work, you know, more and more hours in every day, and that just is not possible. There's only so many hours in the day as we all understand. So, for us, it's about helping those companies streamline and automate their end-to-end workflows so they can work more efficiently and to help them scale up more easily.
And I have questions for both of you today. We'll dig into each of your areas of expertise. Before we get there, though, Shane, these next couple questions are for you because I think we need to lay the groundwork for the conversation. Again, let's head back to that pub. You know, we're talking about MRP today. A common thing we hear in the manufacturing space is ERPs as well. How do you describe the difference between an MRP and an ERP over a pint at a pub? I think that's some important groundwork to lay first.
Yeah, that's important because a lot of people use it interchangeably, and the easiest way to explain it is that an ERP covers the entire business. So, it stands for enterprise resource planning, and basically, it's used by large organizations that want to connect all departments in a business. So, that's sales, HR, accounting. If they're a manufacturer, then it's also going to connect all their manufacturing operations. MRP is a similar idea, that it connects all these different parts of a business, but it's more narrowed in on manufacturing. So, for MRPeasy, it connects sales, inventory, production, and planning, and procurement. So, yeah, the main difference is that ERP is broader. It connects all areas of the business. MRP is more focused on manufacturing.
And one of the things is that, yeah, there's a lot of overlap, and even systems like MRPeasy, which is an MRP system, also have integrations with accounting platforms and CRMs. So, it can do the same thing that ERP software can do in some ways.
Yeah, so if I'm hearing you correctly, tell me if I'm on the right track, but it really sounds like it is the core functionality of what a small-to-mid-size manufacturer would need in an ERP system. That's what goes into an MRP system. Would you say that's another fair way to describe it?
Yeah, but the large businesses also use MRP systems, so it's not just for small businesses. But, yeah, basically a lot of small manufacturers that are looking for ERP software probably actually need MRP software because they're looking to manage their manufacturing. So, yeah, put it that way.
Excellent clarification there. Thank you for adding that. You know, as we're talking about MRP and ERP, I want to take a broader approach to this next question around manufacturing in general. Shane, what are some of the general challenges you're seeing manufacturers face right now?
Yeah, well, the main challenge is that customers that come to MRPeasy, so before they come to MRPeasy, the main challenge is that they're outgrowing their current systems. So, our ideal customer is a small manufacturer with around 15 employees. So, they've started to grow, and the systems that they used when they started, so maybe spreadsheets or manual processes, they're not working anymore. So, basically, yeah, using disconnected systems like spreadsheets and manual processes is breaking down. That's one of the main challenges. So, they're spending a lot more time doing admin work, maybe firefighting, and not actually doing the things that they can do to help the business grow.
Also, they have poor visibility into inventory, so they don't really know what materials they have, if they have enough materials to make a product, and that kind of leads to all other kinds of problems, like they over-promise on delivery times, and then they have late orders and customers are unhappy. So, inventory visibility is a really big challenge.
Also, visibility into costs is a pretty big challenge. So, a lot of small manufacturers don't actually know what it costs to make their product. And they can use an MRP system to see the material costs, labor costs, machine hours, and actually get a better idea of what it costs to make a product, and that has a direct impact on their profit.
So, one example is actually a case study that we did recently. It was a food manufacturer based out of Indiana, I think. And basically, they used MRPeasy to manage their costs. So, if there were ingredients in their recipes that were increasing in price, or suppliers were changing their prices, they would look at their costs in MRPeasy and then adjust the recipes to lower their costs. So, that's one way having better cost visibility can affect profitability.
Yeah, so I've just been kind of keeping my own list on my end going. You started by talking about how without a system like this you're going to have manual processes that ultimately lead to some form of chaos within the business, and this could be lack of visibility to inventory. You had just highlighted cost visibility there as a key driver, and that was an excellent example from that manufacturer in Indiana. Based on that list so far, Sarah, anything you're seeing, any other additional challenges that come to mind that you might add?
Yeah, I think one of the biggest challenges that small manufacturing companies in the UK are facing at the moment is access to new labor to come in. So effectively you've got a very aging population. I think our largest established trade association here in the UK, of which small manufacturers are members, Make UK, are quoting the average age of anybody in small manufacturing to be about 52 years of age. I've seen lots of companies with employees who are a lot older than that. And unfortunately there's a bit of a perception problem here in the UK with getting the younger generation excited enough to come into the UK manufacturing sector. We've also had some new employment rights legislation coming in, which is making life a lot harder for leaders of manufacturing companies to be able to manage this new legislation. And so I think that's driving more people, even these more established businesses, to say we've got to find a little different way of, you know, managing our operations, and let's look at doing things differently. Let's look at automation. And MRPeasy is often that first step in a digital ladder of saying let's move away from the manual processes, the spreadsheets, let's get everybody using a single system, the single version of the truth language that obviously all of us who are involved with ERP understand. And let's get people starting to work digitally with that shared information.
Yeah, and I'll add this. A lot of the Manufacturing Happy Hour audience, probably about 80% of the audience, is based over here in North America. We've got 20% across the globe as well, but I know a number of US manufacturers are feeling the same pains that you're highlighting, whether that is navigating policy or, probably more to your original point, the labor shortages that folks are seeing. So, a very common theme here in this conversation.
We're going to dive a little bit more into case studies here in a little bit, but Shane, I did have one more question for you before we jump into some of the specifics around MRP. And that question is around your background, or I should say the company's background. MRPeasy was the first cloud-based MRP software for manufacturers. This was over 10 years ago, right? You've been around the block before. I know you weren't there at the organization at the time, but I'm curious to hear your perspective on what it's been like for this company to be first to market and how that's helped you succeed today. Because I know a lot of other companies that listen to this are, let's say, early adopters, maybe they're first to market in their space. I think there's a lot to learn from the success you've had over the past decade.
Yeah, yes, we were first to market back in 2014. We were the first cloud-based MRP system. So, just from being at the company, I know that back in 2014, there wasn't anything on the market that basically gave the functionality of an MRP system to small businesses. So, our founders saw the gap in the market, that there wasn't an MRP system that a small manufacturer could actually use that was accessible and that was also affordable, because some of these bigger systems were really expensive. So, they created MRPeasy basically to fill that gap.
And one of the biggest things at the beginning was that MRPeasy was the only cloud-based MRP system in the market. So, there were no competitors, but at the same time, a lot of potential customers didn't know that the software even existed or that it was possible to have an MRP system for small manufacturers based on the cloud. So, there was maybe some hesitation. They didn't know that it was even possible. So, building trust in the early stages was really important. And basically the company did it by keeping the prices really low and offering a good product that worked. And basically kept the prices extremely low for a few years until the company broke even, then started to promote MRPeasy, more and more customers came. And now today there are a lot of competitors that are offering cloud-based MRP systems.
And I should also say that the original vision of MRPeasy was to have an MRP system that was accessible to small manufacturers. So, a part of that is having a system that's also affordable. So, part of the vision is keeping the system affordable for small manufacturers.
Yeah, I mean, when I think about some of the strategy that you highlighted, knowing your target market, knowing that price, the investment, needs to be a part of what you're looking into. When you were talking about being cloud-based 10 years ago, I started to recall that that was, for many, seen as a little bit of a risk back then, right? That was new territory folks were jumping into. To be able to navigate that, and, yeah, we could probably do a whole other episode on this, but I believe the company was bootstrapped as well, if I recall correctly, versus the path that a lot of companies take to get a lot of funding up front. As I understand it, that helped provide a little flexibility along the way as well.
Yeah, for sure.
So, we're going to turn this over to Sarah for a little bit, because I promised at the start of the interview we'd get more into some of the case studies, more of a deep dive. Sarah, if you could paint the picture maybe of one of the more painful scenarios or stories you've witnessed at a manufacturer that's trying to run a business, grow a business, but they're leveraging spreadsheets, old software, whatever it is, right? I'd be very curious to hear what the scenario was and maybe some of the specific challenges they ran into that we were talking about more generally before.
Yeah, so the one that comes most vividly to mind is a very typical CNC machining shop. So two directors, one running sales, bringing the business in, and the other one doing absolutely everything else, managing all of the production and the operation side. Two young guys, so not people in their 50s, so that's why that always sticks in mind. A relatively new company, started in 2017. So a typical CNC machining shop servicing multiple sectors like aerospace, defense, medical, oil and gas. And everything was being run either on a manual spreadsheet, or all the jobs were being scheduled and rescheduled on a whiteboard.
And I remember vividly going into this operation and the operations director sitting us down and starting to show us all of these different spreadsheets, whereby, you know, the quote would be created, it'd then be matched against a quote tracker. Then the quote would be sent off manually. Then the same information would be keyed into the order. That would then be correlated against the order tracker. And meanwhile, whilst all of that activity was going on, he would have to go into the workshop, make sure the guys knew what jobs they were having to do that day. You know, if the machines were standing idle, what was the reason for that? Let's get going and using all of that.
I have to say, after a half day spent with them, let alone him being stressed, I'd only been there half a day. So, you can imagine the stress level that he was under. And as he said, you know, I've got no visibility in terms of where the jobs are, what it is actually costing me. I can't review that information to make operational changes. And I could see the physical signs of stress. And I could see, God, unless something was going to change and a system be put in there, this guy was on a rapid journey towards personal burnout. So, that's why that story, both from a business and a personal perspective, is vivid in my mind.
I was going to say that's a very vivid picture for our listeners, right? You were just saying you were only there for half a day, but you could see where his day had already more or less spiraled out of control. And one of the themes that keeps coming back into this conversation is the lack of visibility, but also the lack of visibility as it relates to cost. Which is my next question. You know, Sarah, what's one of the bigger operational problems that you see that maybe are subtly costing small manufacturers the most money right now? Things that they often don't even realize are costing them.
Yeah, so we've talked a lot about the multiple, you know, spreadsheets, obviously the inefficiency of how much time is being spent copying and pasting and putting the same information into multiple spreadsheets. So, that piece. I think the other big area is
understocking or overstocking. You know, either overstocking so much cash is unnecessarily being tied up, you know, in the business, or worse still, you know, understocking. And I think on that example, it's cropped up a few times in implementations where we talk about how they sort of manage all of their inventory items. And then you get the sort of small, what they consider almost insignificant components, you know, your screws and your washers. And you say, "Well, do you have those on min and max stock levels?" "Oh, no, we don't bother on that. They're quite insignificant in cost." Yes, on an individual unit basis they are, but actually then if you get to then start jobs and you haven't got those components, that can be a serious sort of cost if you've got to delay that order.
The other thing that I would mention also is sort of scrap and measuring scrap and defects. The number of times that companies say to me, "Oh, yeah, well, you know, that we found out that occurred in production." But nobody is sort of measuring that. So, they're not sort of tracking the root cause analysis. So, it's just a routine, "Oh, yeah, it happens from time to time." You wonder how many times that's happening and what the cost is of that. So, those are a couple of examples I would definitely bring out that we see quite a lot of.
Yeah. Yeah, understocking, root cause analysis, another great set of examples to add to our already growing list. Let's start focusing on the positive side a little bit here. We've been talking about some of the challenges, you know, in some good depth here in this conversation. But Sarah, can you walk us through a specific manufacturer where things started to go well, right? Where implementing a system like MRPeasy changed how their floor actually operated on a day-to-day basis. And maybe one of the best ways to do this, can you kind of paint the picture of what their, whether it's their day, their week, what that looked like before an implementation and what it looked like afterwards.
Yeah. So, the company I would select manufactures intumescent fire door seals. So, very niche market. Family-run business. Quite a young company, started in 2021. But actually, the family have about 30 years history in various similar businesses. Very much still working very traditionally. So, they had three separate Excel trackers. Two for the production side, one for the packaging side. Only one single production manager could enter any information in these spreadsheets. There was sort of the paper-based job sheets going out. No actual information on what jobs were costing, which we're talking about previously. Any updates to the customers when they were saying, "Where's my job in production?" You know, people in admin were having to run around the factory and get that information. So, I want to say chaos, but certainly a lack of obvious visibility of what's going on in the business.
So, they clearly wanted, the MD at the time, he's now since retired, wanted to leave the business in a very different shape to what it was when we went into the business. So, clearly wanting to look at doing things differently. I introduced them to MRPeasy. I would say they were a bit skeptical. Their perception of ERP/MRP systems were very much, "God, this is going to cost, I think the MD's words were an arm and a leg, isn't it, Sarah?" And you know, "Isn't this just going to be over the top for our business?" Which I should have said earlier was about 23 individuals at the time. So, there was a bit of having to explain the difference of MRPeasy. They started to run the trial. They started to understand, "God, this is different from what we expected." And then they decided to go forward with MRPeasy with the support from Smart Manufacture.
So, in terms of the implementation and what they're now able to do, we've recently done a case study with the sales director who was our main project sponsor. And now, instead of having those three Excel tracker spreadsheets, paper-based work cards, all of the functions within the organization are using a common set of information that's all in MRPeasy. They're accessing MRPeasy on the shop floor by combination of desktop systems as well as rugged mobile devices. They're capturing the actual cost, any scrap, which was a big area that the previous MD brought up with me. They wanted to identify that so they could make constant improvements to the business. All of that's happening and no one's having to run round the business anymore. Their OTIF is now consistently over 99% and most significantly, the business has grown just
Just to interrupt real quick, what does OTIF stand for?
In full. So, on time in full. So, basically, all of those deliveries are going out as and when planned to go out and fully delivered. Sorry, I was trying not to slip into acronyms.
All good. Hey, if I'm at the bar and someone uses an acronym, I'm going to ask what that acronym was. So, it's all in the spirit of the show. I appreciate the clarification there.
No problem. And then the final piece, which is the really show-stopping fact, is that a year after MRPeasy went live for them, they've grown their business by just over 25% without significant... They've added a couple of individuals, but without MRPeasy, they would have had to have significantly increased their head count. So, it really has been quite a major movement in terms of the company's future.
Yeah, I think what your story highlights is the impact an investment like this can make on the overall state of the business, right? You're talking about 25% growth due to all the other factors that contributed to having more visibility, being able to get product through quicker, not being stuck or not understanding what other people within the business were doing. There are a lot of things that helped in this scenario, and I think what manufacturers can learn from this in a lot of ways, in addition to looking at MRPeasy specifically, there are a lot of lessons around what taking smart action in your business can do to transform even a small manufacturer that, like you were saying, 20-something employees, right? This is something that everyone can do.
But beyond the software, Sarah, my last question for you, what do the manufacturers that you see that are scaling successfully have in common operationally that others don't? I might be able to guess a couple of these things, but I'd be interested to hear your perspective on this, and then Shane, maybe you can jump in after that to help wrap us up.
Yeah, I think what we see is a clear focus and a clear purpose. So, instead of just as they scale up saying we've got to do everything we've always done, we're just going to do it bigger and faster. It's let's look at the core areas of the business that we want to focus on going forward. So, you know, what are the most profitable either types of the business in terms of what they manufacture, customer segments, maybe geographies, and let's focus on those.
Then I think we also see the need for very strong leadership. You know, there's lots of challenges facing small manufacturing companies. So, those leaders have to be very strong in terms of, yes, they've got to have a very good grounding in manufacturing, that goes without saying, but they've got to be very effective communicators, very good at building the teams, but also having, and it's something that we look for as independent manufacturing consultants, where can we really make a difference with the companies we work with, and we look for those leaders to have an open mindset. So, you know, rather than we've always done it this way, oh my god, you know, bringing in a new system, that's going to, you know, demand an awful lot of change. Oh, I don't know whether I can cope with leading that change. It's those that are open to maybe looking at maybe a different way of doing things. They may not know exactly how to do that, but if I bring in the right people and the right technology, I can achieve it.
But also investing in their people. So, yes, you know, MRP, you have to have the right technology, you've got to have the right sort of streamlined processes, but also you've got to bring the people with you. They've got to be engaged at the outset because this technology is a change management program. They've got to understand not only how that technology is going to change the business, but how it's going to change the role that they play in the business. So, as consultants, we focus very much on making sure that we bring the people in with us.
But also those companies that don't just look at scaling as a one-time destination, it's got to be a continual activity, continually looking at new ways of doing things, new processes, also new technologies to bring in alongside MRPeasy for some of those other areas. And I think what's good about MRPeasy is with its open API, that obviously allows that wider integration so that MRPeasy sits at the core, but then there's other specialist applications around it.
Yeah, you definitely covered a good smorgasbord of other factors that go into these organizations, right? From investing in the people, from looking at scaling as an ongoing activity rather than just a one-time project. Sarah, I appreciate all the insights, all the stories you've brought to this conversation. Shane, as we wrap things up, I mean, is there anything else you would add as it relates to these case studies or these examples?
What exactly, like?
Yeah, I'm just curious. Maybe a different way to ask this question is, is there anything you wish we would have talked about so far? A question you wish I would have asked you that hasn't come up yet.
Yeah, I guess I would like to talk about MRPeasy's user manual and basically the emphasis that we put on giving small manufacturers all the tools to implement the software themselves, because one of the biggest misconceptions about MRP systems is that it's really expensive to implement. So, that's one of the main reasons that a lot of small manufacturers don't even want to think about it, is that they think that it's going to cost so much to implement and then also the licensing fees. But with MRPeasy it's made affordable, so the licensing fees are low, and also we have a really extensive user manual. So basically, if a small business owner wants to implement the software on their own, they can use the user manual to learn everything they need about the software.
And we also have an AI chatbot that actually gives answers, so it's trained on the user manual. So you can ask the chatbot anything you want to know about how the software works and it'll tell you what it can do and what it can't do. So that way it becomes as simple as possible to implement the MRPeasy system. And we also have a customer success team, and basically their role is to also educate users on what the software can do and what it can't do. We don't actually go into the business, we more just explain to users how the software works and try to help them implement it on their own.
So the self-implementation is a really big part of MRPeasy, and then also we have a lot of customers that don't have the time, so they're busy with running a business and they don't want to implement it themselves, so then we work with partners like Sarah who helps business owners implement MRPeasy.
Yeah. Excellent to highlight the user manual, the self-implementation capabilities, the partners you have in Sarah for companies that want to take that path. It's been excellent having you both here on the show. I'm going to make sure there are links over in the show notes page at manufacturinghappyhour.com to connect with both of you, to find MRPeasy. It is simply MRPeasy.com. Correct? That's where folks can find you?
Yep.
Excellent. We will have all that over in the show notes page. I appreciate you both taking the time to grab a virtual pint this afternoon and have this conversation. Thank you both for being on Manufacturing Happy Hour.
Thank you, Chris.
Cheers.
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