Business Organizations incur expenses while running regular operations. They could be in the form of travel expense, fuel expense, utility expense, and other overheads. While drawing up a business plan for a year, companies usually budget for certain amount towards various expenses. The idea behind the budgets is to set a limit on the expenses in relation expected revenues. However, setting up budget is just a starting point. The rubber meets the road when the actual expenses start getting incurred and booked into the system. If the organization is not able to keep a track of such expenses in a near real time basis, it would be a challenge to implement the budgetary controls, thereby rendering the budgeting exercise futile
SAP Business One has the necessary feature functionalities and tools which when used appropriately can deliver ability to track and control expenses. Thanks to the strong integration between various functional modules it is possible to set hard or soft controls as needed at the point of expense. For example, if the budget for stationery items has been used up, system will stop the buyer from the raising the PO for this category of items, thus preventing a budget violation, should the material have arrived and vendor was paid.
Tracking Expenses – Cost Center wise
A cost center is a company unit or division that performs a specific business function like Sales, Administration, HR etc. The cost center you define here represents the respective division or department, and is used to consolidate the expenses and revenues resulting from the ongoing activity of the specific organizational unit.
In SAP Business One it is possible to set-up a cost center hierarchy. Further, expenses can be allocated to these cost centers based on distribution rules, cost centers can be assigned to expense/revenue/Cost of Goods Sold account and budgets can be set-up at a cost center and expense account level. Plan versus budget reports can be drawn up proactively which may lead to decisions that help in reducing further expenses.
Tracking Expenses – Project wise
In simplest terms a project is a set of inter-related tasks to be executed over a fixed period of time within certain cost and other limitations.
In SAP Business One, projects can be set-up and can be used to manage your projects from start to finish, centralizing all project related transactions, documents, and activities. Further it helps you to monitor the progress of tasks, stages and phases, analyze budget costs, and generate reports on various aspects of the project, such as stage analysis, open issues, and resources. Using this feature project level budget can be set-up and used for tracking plan v/s actual cost effectively. Also, you can run a project level P&L statement at any time to understand the financial situation of the project and take proactive actions to ensure that you are within budget.
Proactive Alerts – Raising the Red Flag
SAP Business One allows you to set-up alert for variety of business event triggers. It could be an alert for depositing tax to government before the last date or it could be for paying utility bills within time. The possibilities are many. Such alerts when received proactively can help reducing penalty or interest cost and improve company’s compliance towards statutory requirements.
Lower Technology Costs
SAP Business One is a software priced for small businesses, and offers a cloud deployment model for companies that want to avoid the capital investment and resources required by an on-premise software implementation.
- Businesses are able to do away with the need for large IT departments or even the need for at least one IT personnel in each subsidiary.
- SAP Business One is a system that can be implemented quickly with the help of BTC capable team, is uncomplicated to maintain, and minimizes end-user training.
In the Office
SAP Business One:
- Helps you to analyze and manage your staff, your most valuable but also most costly resource. With efficient, automated data management processes reducing the need for manual tasks and double work, your employees will be able to work on critical tasks at more productive levels.
- Allows you to intelligently identify and track KPIs, making it easy for you to reward the most productive members of your team, and either motivate unproductive employees or help them to achieve their KPIs by pointing out areas of improvement.
- Generates reports in real time, so that you no longer miss out on sales opportunities or delay addressing critical issues. Heavy investments of time and money spent on creating reports internally or on outsourcing report generation can be spent on other income-boosting activities.
In the Warehouse
- Manufacturing process glitches can be rectified quickly, avoiding costly delays and defects. Your employees are empowered to log issues with machines directly into your SAP ERP, system, complete with photos and scanning, to notify senior executives of what is happening on the ground immediately.
- Intelligent procurement and production methods eliminate the need for manual stock counts and checking back against several sources of information before making decisions. The system automatically checks previous records of suppliers and customers for purchased models, quantities, prices, and so on.
Not only does this save time and manpower costs, you don’t have to worry about overpaying for stock or underpricing your products and services.
Reduce Your Paper Trail
Small to medium sized businesses are often bursting at the seams with printed materials. Digitizing your documents with SAP:
- Helps you to save time, money, and physical space spent on printing and storing documents. Not to mention saving the environment!
- Allows you to quickly sort through endless sheets of data for the information you require, and generates real-time reports to help your team make well-informed decisions.
- Prevents you from losing important information to physical degradation over time.
The potential of SAP Business One helping companies in UAE and Qatar reduce their expenses is significant. Whereas only a few examples have been explored here, there are many more methods and tools available in the system that can help setting up an environment which once active can spare the business owners additional time which can be spent towards more value adding activities for their business.