Companies in food-related industries absolutely must utilize purchase planning software if they want to enhance their forecasting accuracy and save money in the process. Unfortunately, only a fraction of companies are currently taking advantage of the resources they have available to them. You can gain a competitive advantage by becoming an exception to the rule.

When food businesses involved in manufacturing and production fail, one of the first things a savvy outsider will wonder is whether they had a strong purchasing plan. Most businesses do not, and as a result they end up purchasing the wrong ingredients, paying exuberant amounts for those ingredients, purchasing the wrong amounts, and tying up capital in excess inventory. While purchase planning doesn’t get discussed nearly enough, it should be the foundation of your company.

Here are a few reasons why:



1.Better control over unique inventory

When purchasing is handled manually, the time and effort involved often leads businesses to order items they don’t really need at the time. For example, let’s say you’re a bakery and you see that you’re down to your last 50lb bag of flour. You know that you need to get an order in within the next couple of hours and decide to see if any other ingredients are running low. You see that you only have five 50lb bags of sugar left and decide you may as well replenish your sugar inventory so that you don’t have to worry about it later.

The only problem is that when the new inventory arrives, you don’t have anywhere to put the excess sugar and you’re forced to shuffle things around, which slows down other processes and costs the business money. Because manually ordering inventory takes time, you chose to cut some corners and it ended up costing you more time. With purchase planning software, you don’t have to worry about this. Everything is automated, which allows you to purchase just the right amount at just the right time.

2. Security safeguards

All it takes is one click of a button or a decimal point in the wrong place to totally mess up a purchase. If you don’t have any safeguards in place to prevent fraudulent or erroneous ordering, then you’re asking for trouble.

With purchase planning software, you can set parameters and approval mechanisms that protect your business from fraudulent and unauthorized activity, as well as honest mistakes. This can save you thousands of dollars in the long run and ensures you don’t end up with a supply chain nightmare.

3. Real time purchasing

Prices for certain ingredients – especially raw and perishable goods – can change rather quickly. Placing a purchase order now versus in one hour could mean the difference between a few hundred or thousand dollars.

Unfortunately, if you’re placing orders manually, then you have to deal with lengthy approval processes and unnecessary steps. With purchase planning software, you can see prices in real time, speed up approvals and accelerate the overall process.

4. Better invoice and payment management

When you make the decision to implement purchase planning software, your accounting and finance departments will be the happiest people in your entire organization. With purchase planning software, the billing process becomes much faster and both invoice and payments are streamlined with astounding accuracy. This tightens up accounting statements and allows you to enjoy a clearer overall picture of your company’s financial situation.

5. Connects all departments

When you make a purchase order, everyone needs to know about it. But when orders are placed manually, this doesn’t always happen. As a result, things slow down, confusion erupts and people start pointing fingers.

With purchase planning software, the purchase plan is streamlined across all departments and everyone has real-time visibility as to what’s happening and when. This reduces frustration and keeps everyone on the same page.

6. Better use of employee time

When your business is able to enjoy all of these benefits, your employees don’t have to spend their time handling mundane tasks and overseeing complicated manual processes. Instead, they can let purchase planning software take care of these responsibilities and use their time elsewhere. From a management perspective, this is a much better use of human capital and allows you to get more done on an hourly, weekly and monthly basis.

More on system integration

Purchase planning is just one importance aspect of your company’s operations. As mentioned above, having an integrated system allows your purchasing planning data to filter into your costing, production and sales systems so that you’re able to accurately forecast and run a more efficient business.


Ready for a specialized food ERP? Learn more about Aptean Food & Beverage ERP JustFood Edition — a solution purpose-built to solve your challenges and propel your food business and digital transformation to the next level.