Subcontracting plan criteria is met optimally by an SMB with a Cloud ERP

A Cloud ERP can help meet the requirements of a subcontracting plan set out by a leading manufacturer.

In many industry-sectors small businesses have thrived as subcontractors. Major brands have looked to delegate significant elements of their manufacturing and assembly processes to small business partners. These small businesses typically focus on few product lines. They have the flexibility to re-configure products quickly. These subcontractors can adapt overnight to changes in delivery specifications such as the sequence and timing of product deliveries. These are key requirements for those giving out subcontracting work.

Capability to regularly update their IT systems is a key component of being successful in meeting the requirements of the subcontracting plan. Older systems that support communication protocols such as EDI (Electronic Data Interchange) are a disqualifier. They have historically proved reliable in communicating orders, invoices and cash payments bi-directionally between parties. However, they were also typically expensive to buy, implement, reconfigure and support.

Cloud-ERP systems – that include application programming interfaces (API’s) as well as EDI – allow more disparate systems to be easily integrated and supported. Smaller, growing businesses can now select a system more appropriate for the exact business processes needed. They can manage costs effectively while providing the service levels demanded by up-stream partners.

They can then meet the requirements of the subcontracting plan affordably, easily and with appropriate functionality.

This is the second article in the series of articles by the Versa Team on “Can small businesses thrive using strategic collaborations with supply partners and customers?”