Distributed organizations whose branches operate as separate entities often face challenges related to their parts and pricing policies. Centralized control across the entire organization presents many problems, which can, however, be effectively solved using the mechanisms built into EPICOR Kinetic ERP. This allows for full control over parts distribution and pricing policies across the entire organization, accelerating processes and eliminating errors.
Such mechanisms are usually referred to as multi-company support. They allow for a simple, consistent way to calculate the production costs of individual products in factories across different countries and adjust locally applicable pricing policies accordingly. The challenges involved primarily concern differences in production costs, taxes, customs duties, currencies, and other fees resulting from shipping, as well as the settlement of transactions conducted “within the group” between company branches.
EPICOR Kinetic ERP allows for the entry of every new product into a central registry and the transmission of the information contained therein to the remaining company branches. At the same time, a price calculation is performed—in accordance with an established algorithm and defined criteria—which is also automatically transmitted to all members of the organization.
Thanks to this, the system can also handle internal transactions in an automated manner. When one company enters an order into the system, it is transmitted to the second company. All necessary documents will be automatically generated—from the production stage to distribution. Among other things, a sales invoice will be generated, which will be sent to the ordering company, where it will be recorded as a purchase invoice. Naturally, various price lists—internal and external—function consistently within these mechanisms. All of this is a standard element of the system. There is no need to set up data exchange formats. All settings are made using built-in functions.
One of our clients, Cold Jet, which has its headquarters in the USA and several branches in Europe that function as separate organizations, uses such mechanisms.
Cold Jet operates within two business lines focused on the use of dry ice. The company manufactures systems for ecological cleaning, surface preparation, and finishing of parts for many industries around the world. Secondly, the company produces systems for the production, dosing, and packaging of dry ice for food transport, cold chain management, and dry ice cleaning. Cold Jet devices are manufactured in the USA, Poland, and Denmark. Meanwhile, the remaining branches in Europe—including those in Germany, Belgium, and France—are exclusively engaged in their sales and distribution. It is obvious that the price for one branch buying a product from another branch will be different than for an end customer. The problem is even greater when the company is not large, yet the number of transactions is significant.
By utilizing the built-in functions of EPICOR Kinetic ERP, we provided the US headquarters with full control over pricing policy. Prices are calculated based on planned production costs separately for each country where sales are conducted. At the same time, a different price list applies to intercompany transactions than to customers.
The problem for Cold Jet was even greater because the company is growing dynamically and, with this growth, is selling many more devices while maintaining a constant headcount. Several hundred people work in the USA, while in the European companies, the number ranges from a dozen to several dozen.
The implementation of EPICOR Kinetic ERP allowed for the acceleration of transactions and the streamlining of financial processes. Thanks to the central item database, management keeps its finger on the company’s pulse at all times.
