As your Filipino SME business grows, all the headaches that come with it sprouts every so often.  Any businessman will know a major headache that a Filipino entrepreneur faces is inventory management.   Spoilages, theft and non-recording of items are a major daily concern. Your business may have faced issues like:

  • A customer returns P200k worth of items at the warehouse but management never found out until an audit was done; This is costly if the parts are old stock and cannot be reused or re-sold;  Adding insult to injury is a damaged customer relationship as management wasn’t able to respond promptly to the customer
  • Accounting charges a customer when the item wasn’t actually delivered to the customer ie. Accounts Receivables do not match actual product received by the product
  • Connivance between employees (even with guards) to pilfer items from the inventory; there are instances where an employee syndicate sells these same items to the company’s distributors at a lower price and, at times,  the distributor is forced to buy from the employee syndicate as the Company’s accounting department makes life difficult for the distributor
  • A distributor has a special part made for him by the parent company; The parent company manufactures more than required and the company driver tries to sell the excess quantity (of the part that was really meant for him) to the distributor
  • Siphoning of petroleum from vans by your logistics team

Is iDempiere the solution to the issues above? Yes and No.  iDempiere is an ERP system that makes sure that movements of products are recorded from the time it is received at the warehouse, manufactured or stored, released and delivered to the customer.  It is an IT tool that enables the company to record every item which moves within the premises. It is capable of producing the following:

  • Multiple Warehouse and Locator Management
  • Sales Order that is matched with Warehouse movement, Accounts Receivables, Payments and Invoice
  • Distribution Orders
  • Pick Lists and Packlists
  • Authority To Withdraw (ATW) that is matched with any Sales Order
  • Manufacturing (RM to Work-In-Process to Finished Goods)
  • Inventory Transfers with or without movement confirmation

If properly implemented, it allows management to find out current inventory levels at a switch of a button.  The presence of the computer system itself is a hindrance to theft because all transactions are recorded and iDempiere has the ability to log history of transactions.  However, iDempiere, as in all IT systems, must be used together with other available tools to ensure security.  All Filipino SME must ensure that proper security systems are in place to prevent spoilages and theft. This may include, but not limited to:

  • Coordinating with your security company to rotate guards every so often
  • Secure warehouse with a few designated staff allowed to open/close it
  • Regular physical inventory count and audits
  • Establish min/max inventory threshold
  • Corporate culture emphasizing honesty and trust between employees and company
  • Some companies have gone to the extreme activity as having lifestyle checks for its employees.

Inventory management is always difficult for an SME to manage especially if they don’t have the same resources as large companies.  However, there is always a way to improve control and iDempiere is an IT Tool that is capable of supporting any Filipino SME corporation.