We’ve heard a lot recently about how the economy, particularly manufacturing, is picking up. Usually this is in regards to manufacturing as a whole, which could mean anything from Boeing 787s to toothbrushes, or maybe Fortune 500 companies to one-person jewelry operations.
So I was really interested when I ran across a survey done about 9 months ago by Netsuite, a high-end, SaaS-based, competitor to Fishbowl. They surveyed 85,000 U.S. manufacturers in the lower-mid market, (which they define as companies that sell under $500 Million/year).
Results? “More than 75% believe their business will improve in the near term, and almost 98% reported that they believe their business will either improve or remain steady” (FYI, a recent survey by Deloitte and Touche put the mark closer to 90%!)
Cool, but how do these companies plan to improve? Well, I won’t go over everything mentioned in the survey, but so much of it applies to what Fishbowl provides that I will include a good portion of it:
74% of Mid-market companies plan to cut costs, but how? Here’s how it breaks down:
• 70% Improve employee productivity
• 60% Modernize, streamline and automate business processes
• 46% Reduce paperwork, data entry and redundant processes.
• 44% Minimize inventory investments
• 16% Outsourcing
Wow! In each of the above-mentioned cost improvement categories, a strong case can be made for Fishbowl (or some other manufacturing related product) as the means whereby the cost reduction is accomplished, (which is probably why NetSuite went through the cost and hassle of doing such a large survey in the first place!)
Which new technologies do they plan to use to make their business more productive or efficient?
• 52% Lean manufacturing
• 30% Cloud computing
• 29% CRM
• 25% MRP
• 24% Supply Chain management
• 20% Ecommerce
• 8% Warehouse management
Again, in each category a strong case can be made for Fishbowl as a means to get there.
Lean Manufacturing? Fishbowl helps keep raw material inventories at a minimum until needed by the manufacturing process.
Cloud Computing? Well, technically no, but hosting, absolutely. And at the end of the day all the customer really wants is a reliable way to run the software they need over the Internet, without having to pay out the big IT dollars for their own network.
CRM: Almost there!
MRP: MRP lite.
Supply Chain Management, Ecommerce, Warehouse Management. Yes, yes and yes, to varying degrees.
And the truth is, Fishbowl is not intended to be a full-blown solution in all areas to all manufacturing companies in the mid-market. Ours is intended to be a lower mid-market solution. Companies in our space need most of these requirements addressed to some degree but rarely to the extent (and cost!) that a full-blown mid-market solution would provide.
Now here is a question that I found particularly interesting:
51% said “Support for ALL Business Processes as the most important requirement for manufacturing business software — the old piecemeal approach has proven itself to be too costly, too complex, too fragile, too limiting. This appears to reflect dissatisfaction with single-purpose solutions that often require costly integration, maintenance and upgrades, and that can hinder employee productivity”.
Frankly, as recently as two years ago I would have to say guilty as charged where Fishbowl is concerned. We WERE a single-purpose solution and still are to a great extent. But we are fast addressing this issue with our own, home-grown solutions for CRM, Ecommerce, Warehouse Management, Cloud Computing, etc. For those needs we can’t address ourselves we work with partners to provide it. We aren’t there yet, but this survey underscores the fact that we are headed in the right direction.
What is the most important strategy you’ve implemented to manage inventory?
• 42% Lean manufacturing
• 25% Demand planning
• 12% Integrated MRP and finance
• 6% Outsourcing manufacturing
Again, Fishbowl addresses many of these needs already and where Fishbowl’s current abilities fall short, we are already aware of the need and are working to address it.
And last, my favorite question:
In 2011, are you budgeting to invest in new or upgraded software for your business?
• 47% Yes
• 32% No
• 11% Further out
• 9% Not sure
47% YES??? Approximately 85,000 mid-market companies responded to this survey but there are over 300k mid-market firms in the U.S. In other words, 150,000 mid-market firms are planning to invest in, or upgrade, their software this year! Assuming an average of $50k/firm and you’re talking about $7.5 billion in software purchases.
Here’s to a great 2012!
Till next time!