Does getting a discount always mean you save?

Jul 10, 2013
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Why do people initially look at upgrading their Accounting system to a system that integrates with the rest of the organizations operations?  Usually, it’s for the future benefits to the organisation that will help people save time and therefore money.  However, when working through the process of selecting a system it’s easy to forget this and think about saving in the short term.  Especially as we are all on tight budgets and saving at the time of purchase has a lots of appeal.

The savings that are made buying a cheaper system ends after the purchase.  All too often the new system can end up costing an awful lot in people’s time, as they continue to carry out jobs either manually or have the need to enter information twice.  The worst part is that the organisation becomes limited to the growth it can make, with people being too busy to deal with more customers and more jobs or products.

Often we aren’t talking about extremes in costs of; $ 15,000 to $ 100,000, for a system that is more integrated, has more time saving features and provides more visibility.  To get into a system which will provide information at your finger tips and give you the ability to make decisions based on facts, you may be looking at difference of between $ 15,000 and $ 25,000.

$ 25,000 is a lump in any organisations Cash flow, look for suppliers that offer well priced finance to smooth this cost.  What if you decide that the $100,000 is where you want to be?  But it’s out of the budget range right now?  Rather than go through the process of implementing system after system.  Look for a system that can be installed in parts, so that it can grow with the organisation.  I've seen people rush in and buy a system because it’s simple and the cheapest, only to find themselves spending thousands more dollars and frustrating staff in the process to make up for the system’s short falls.  Running a business isn't simple is it?  How would you expect a simple system to cope?  In the worst case these systems don’t support good Accounting processes and without any checks and balances in place, fraud can occur.  Simple systems often don’t provide the functionality needed to help control cost and alert you to problem areas in the organisation.

Instead they could have taken a little more time and thought about how they wanted to improve the business and written-up these requirements, thus making sure that any system assessed will be able to support their business on its growth path.

So what’s the moral of the story?  Good systems do help you save money, they aren’t always the simplest, but you need to make good initial choices and have good people running them.  Stay away from buying systems that are less functional and don’t have good Accounting process and cost control.  Unless you are happy to carry out reporting and other processes manually.  Our advice would be that carrying these activities outside your system can be error prone.  There are modular systems available so they can be implemented as they provide return on investment.  It may cost a little more in the short term, but in the long term you’ll be much better off.  When you look at financing ask for the options to wrap costs such as upgrades, so you aren’t surprised by any ongoing costs.  Adding finance into the mix may mean you can recognise real financial benefits and growth today, rather than waiting till tomorrow, or missing out on an opportunity.

Sonia Elliot

SoniaSignature

 

 

Marketing Manager

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