Article
December 2023
On Improving your Cash flow using OurSys
A healthy cashflow is as important as the profit percentage. OurSys has been designed to help you improve your cashflow and avoid common traps.
This article shares dos and don'ts for cashflow improvement.
Here is how you can take advantage of OurSys
Using the dashboard for monitoring items on order whose Bill of Material is not available.
In order to execute the order, the design has to be frozen and Bill of Material has to be released. OurSys has a dashboard which shows items on order whose BOM is not released.
Designers can identify their backlog this way and clear it as soon as possible to get the ball rolling.
Using dashboard to target unplanned Sales Orders
The MRP program must be run as soon as possible for the new Sales Orders being booked. MRP triggers further activities of Purchase & Production. In case MRP is not run, the order execution is stuck.
OurSys has a dashboard which indicates Sales Orders for which MRP has not been run. Using this dashboard, planners can identify such Sales Orders and run MRP for them.
Using MRP for Purchase Requisition and Job Order Generation
The MRP program under the PPC module is not only a huge time saver but also cuts down inventory costs by ordering precise required quantities. Weeks of work can be done in seconds using MRP.
This will result in faster delivery, improved cashflow and reduction of working capital stuck in WIP.
Purchasing strictly based on Purchase Requisitions
Purchase orders must be strictly placed based on purchase requisitions. Purchase requisitions have approvals and hence bring control on what is being bought. Also Purchase Requisitions generated using MRP help to buy optimum quantities.
Suppliers sometimes tempt the buyers to increase the quantities. But with this control, excess quantity will not get bought thus improving overall cashflow.
Using Component Swap functionality to maximise invoicing
In case an item on order is stuck for want of a few items, OurSys can identify where the short item can be found and helps to quickly swap that item for the urgent item with the requisition of the urgent item.
This way, more finished goods can be shipped out and thus improving invoicing and cashflow.
Identifying and Relieving Bottlenecks
Production bottlenecks can be easily identified in OurSys using the Process wise Load Report. Chronic bottlenecks can be then addressed which can improve the throughput in a big way thus resulting in a better cashflow.
Stock Ageing Monitoring
Despite buying correct quantities, there is always a chance that some stock could be quietly ageing in the stores. It could be because of cancelled orders, sales returns, order alteration etc. Whatever be the cause, money gets stuck.
Therefore it is important to have a routine of checking the Stock Ageing report and target old stocks and find root causes. OurSys not only provides a stock ageing report but also links to the PR in order to find out why it had come in the stock.
Project wise balance of receivables & payables
OurSys has the feature of opening a Cost Centre for every sales order. All expenses, revenue, payments and receipts get tagged to the cost centre. OurSys has Cost centre wise Balance Sheet, where it displays the balance between total receivable and total payable for a given sales order.
This is particularly useful for companies who take project type of orders.
Paying attention to warnings in Sales Order about overdue payments
In case of overdue payments, the moment you try to book the order, OurSys warns about the overdue payment under the Insights sections. There is a danger of further payments getting stuck affecting the cashflow adversely.
Both makers and approvers must thus pay attention to such warnings.
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