Introduction.
Delta Water Products, a value-added distributor of water products for the agricultural, industrial, and commercial sectors, identified opportunities to build a foundation to scale their business following the acquisition of three companies in 2023. Their rapid expansion underscored critical operational inefficiencies, such as a lack of inventory visibility, fragmented financial reporting, and a suboptimal gross margin on sales. To address these issues and support future growth, Delta Water Products enlisted our expertise to implement Microsoft Dynamics 365 Business Central.
Business Challenges.
Delta Water Products' expansion revealed significant business challenges. First, the lack of inventory visibility across its multiple entities was a pressing concern. Each company operated with its own system, making it nearly impossible to have a consolidated view of inventory. This fragmentation led to overstocking, inflating inventory value by an estimated 20%.
Financial visibility was equally problematic. The need to amalgamate financial reports from various accounting systems made real-time financial oversight and decision-making cumbersome. This patchwork of systems hindered their ability to produce timely and accurate financial reports, complicating strategic planning.
Moreover, the company struggled with optimizing its gross margin on sales. Without visibility into real-time costing, Delta Water Products found it challenging to make informed pricing decisions, impacting profitability. This lack of insight made it difficult to adjust prices dynamically based on market conditions or vendor pricing changes.
Objectives + Strategy.
The primary objective was to consolidate all entities under a single, robust ERP system that could resolve these operational inefficiencies. The chosen system needed to support Delta Water Products' ambitious growth targets, scaling to manage revenues in the $300-500 million range. Stability and long-term reliability of the ERP provider were also crucial to ensure continuous support and updates.
Delta Water Products chose SiteTechnology to help guide their selection and implementation process, identifying our team’s flexibility and expertise as a primary reason they entrusted us with a core part of their digital transformation.
Business Challenges.
Delta Water Products' expansion revealed significant business challenges. First, the lack of inventory visibility across its multiple entities was a pressing concern. Each company operated with its own system, making it nearly impossible to have a consolidated view of inventory. This fragmentation led to overstocking, inflating inventory value by an estimated 20%.
Financial visibility was equally problematic. The need to amalgamate financial reports from various accounting systems made real-time financial oversight and decision-making cumbersome. This patchwork of systems hindered their ability to produce timely and accurate financial reports, complicating strategic planning.
Moreover, the company struggled with optimizing its gross margin on sales. Without visibility into real-time costing, Delta Water Products found it challenging to make informed pricing decisions, impacting profitability. This lack of insight made it difficult to adjust prices dynamically based on market conditions or vendor pricing changes.
Choosing Microsoft Dynamics 365 Business Central.
After a thorough analysis, Microsoft Dynamics 365 Business Central emerged as the optimal choice for several compelling reasons.
- Multi-Company Setup: The system's straightforward multi-company setup was a significant advantage. Business Central allows seamless management of multiple entities within a single platform, which was crucial for Delta Water Products, given their recent acquisitions. This feature enabled a consolidated view of inventory and financial data across all companies, facilitating better decision-making and operational efficiency.
- Cost-Effectiveness: Business Central's pricing structure offered an affordable, user-based monthly fee, which fit well within Delta Water Products' budget constraints. This cost-effectiveness did not come at the expense of functionality, making it an attractive option for a growing company looking to manage expenses while enhancing operational capabilities.
- Ease and Flexibility of Configuration: The flexibility and ease of configuration of Business Central were standout features. The system could be tailored to meet Delta Water Products' specific operational requirements without extensive customization. This adaptability ensured that the implementation process was smooth and aligned with the company's unique needs.
- Real-Time Financial Management: One of the key features of Business Central is its robust financial management capabilities. It provides real-time financial insights and streamlined reporting, addressing the challenge of fragmented financial visibility. This capability allowed Delta Water Products to consolidate financial reports from various entities efficiently and make informed strategic decisions.
- Inventory Management: Business Central's advanced inventory management features were particularly relevant. The system offers real-time tracking of inventory levels, automated stock replenishment, and precise inventory valuation. These features enabled Delta Water Products to reduce excess inventory, optimize stock levels, and improve overall inventory accuracy.
- Sales and Pricing Management: The system's sales and pricing management tools were instrumental in optimizing gross margins. Business Central includes a customizable pricing engine that can adapt based on changing vendor prices, ensuring competitive and accurate sales pricing. This capability directly addressed Delta Water Products' challenge of maintaining optimal gross margins and reducing pricing errors.
- Integration and Scalability: Business Central's seamless integration with other Microsoft products, such as Office 365 and Power BI, provided additional value. This integration facilitated data analysis and reporting, enhancing overall business intelligence. Moreover, the system's scalability ensured that it could grow with Delta Water Products, supporting their long-term revenue targets and expansion plans
Implementation Journey.
The implementation journey began in September, with a target to go live by the beginning of December. The first phase involved a rigorous selection process, which spanned 90 days. During this period, we conducted stakeholder workshops, gathered detailed requirements, performed comprehensive market research, and organized multiple software demonstrations to ensure the best fit.
Upon selecting Microsoft Dynamics 365 Business Central, we moved into a detailed analysis phase. We developed a comprehensive Business Requirements Document (BRD) that encapsulated all the requirements for the implementation. This document served as our blueprint as we proceeded to configure and implement the software according to Delta Water Products' specific needs.
Given the aggressive timeline, we adopted a phased approach. Initially, we focused on core functionality to ensure we met the December 1 go-live deadline. Our team worked closely with Delta Water Products' staff, particularly in the first business unit to go live, to ensure they were thoroughly trained and prepared for the transition.
Overcoming Challenges.
The primary challenge was the limited timeframe. However, our team's dedication and close collaboration with Delta Water Products proved instrumental. We maintained constant communication, ensuring any issues were promptly addressed and that the project stayed on track. This collaborative approach allowed us to meet the aggressive deadline successfully.
Shortly after, we began implementing a second company in their group and followed a similar approach in a short period of time, implementing by April 1.
Achieving Results.
Since going live with Microsoft Dynamics 365 Business Central, Delta Water Products has realized significant improvements in several areas:
- Inventory Management: Real-time visibility into inventory has improved their management processes, allowing for more accurate tracking and efficient use of resources. This has enabled the company to reduce excess inventory and optimize stock levels.
- Financial Reporting: The consolidation of financial reporting has streamlined financial management and provided the insights needed to make informed, timely decisions. The ability to produce accurate and timely financial reports has improved strategic planning and operational efficiency.
- Pricing Strategy: A customized pricing engine has been established, enabling adaptive pricing based on vendor changes and reducing pricing errors. This has allowed Delta Water Products to optimize their gross margins and remain competitive in the market.
Conclusion.
The transformation of Delta Water Products through the implementation of Microsoft Dynamics 365 Business Central has been a resounding success. By addressing critical operational challenges and laying a solid foundation for future growth, the new ERP system has empowered Delta Water Products to enhance their efficiency and profitability.
As they continue to integrate more functionality, onboard the remaining business units, and adapt to evolving market conditions, Delta Water Products is well-positioned for sustained success and operational excellence.
