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How NetSuite Is the Next Generation Solution for Engineer to Order Businesses

With new businesses entering the market frequently, customers today have infinite options to choose from. What used to be a noteworthy USP a few years ago can no longer help you be the market leader on its own. Due to the fierce competition, businesses are becoming increasingly replaceable with each passing year.

But the key to survival—profitable survival—lies in customization. This is where ETO comes into play.

What are Engineer to Order (ETO) Processes?

Engineer to Order (ETO) refers to finished goods customized or tailor-made according to the customer’s specifications. Consider the case of swivel chairs. There are hundreds of options to choose from regarding the chair size, backrests, legs, leather covering, and type of cloth. Since customers can choose the kinds of chairs they want, businesses can’t necessarily keep that much raw material. It’ll be very cost-inefficient.

Under an ETO system, minimal quantity but a large variety of raw materials are stored. This enables them to deliver different combinations of products quickly. However, there are many challenges in terms of custom-made manufacturing. To deal with the high costs, all components of the supply chain must receive information timely. These include purchasing, production, development, construction, and maintenance.

A worker in an engineer to order factory

 

Common Struggles for ETO Businesses

In most cases, ETO businesses fail to deliver customized articles due to miscommunication between project management and the financial team. This often leads to over-estimating the revenue along the way. The supply chain department usually struggles to deal with inventory build-up. Procurers often end up purchasing extra inventory to reduce the per-unit cost. As a result, they tend to lose control over the cost function, especially if there are differences between budgeted and actual costs. In the middle of all this, loss of inventory can result in double ordering and raised expenses.

How can NetSuite make it easy?

NetSuite offers specialized solutions to help ETO manufacturers to provide customized products to customers. NetSuite integrates project management, shipping, manufacturing, procurement, and warehousing seamlessly into a single system. This reduces any chances of discrepancies, miscommunication, and inconsistency. Any piece of information can be shared across the board to make sure all the departments are on the same page.

The Supply Chain Management Module helps you forecast sales and enhance visibility. It makes all the stakeholders more aware of the supply chain status with the help of user-defined alerts. It also enables you to optimize your delivery times and reduce lead times. As a result, you can also overcome supply chain cost variances as they occur.

If you still haven’t given your ETO business a significant efficiency boost, now is the time to do so. Get in touch with the NetSuite experts at Ravenstone Solutions for reliable NetSuite integration services.

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