Dagestan Shoe Factory reduced material costs by 30% and increased the speed of issuing orders using ERP

2022: ERP Implementation

On October 19, 2022, First Bit announced the optimization of production costs and order processing speed in the Dagestan Shoe Factory thanks to the introduction of ERP.

According to the company, the production was registered manually and the transition to the next stage of production was possible only the next day, although it was possible to continue working without interruptions, in addition, the opening of the production warehouse was being prepared, and the automation of the accounting was just by the way.

The implementation of the ERP system made it possible to track the stages of work in online mode, and not only at the end of the shift, as it was in 1C: Integrated automation. All semi-finished products are tied to orders - online you can see which semi-finished products and on which orders have already been made, where they are, and where they need to be transferred.

As of October 2022, it is impossible to mistakenly write off a semi-finished product for the production of any other order in the program, and production managers are more responsible for accounting for materials.

For reconciliation of calculations, an atypical report has been developed, which allows you to compare the data on accrued wages from the "Salary" subsystem with the data of production accounting.

Due to the specifics of the production of footwear, work, within the framework of one order from one performer, can last a very small amount of time - it can be several minutes for one pair or less, and accordingly, in a month one employee performs a large number of works on different orders with different prices. At the same time, most production workers have a piece salary, so it is important to provide each employee with a detailed decoding of the work he performed.

Another advantage of the implementation of the ERP system was the completely laid-back process of movement and transfer of materials at alterations.

Previously, the factory ordered only leather, the cost of which has a large weight in the total cost of the finished product. Leather was issued on order at the rate of consumption and did not take into account the actual use of materials for a specific order. Other materials were issued on demand, without taking into account the norms.

1C:ERP allowed you to set up cost targets and accounting for all materials, while taking into account the remaining materials in the areas. As of October 2022, all materials are issued according to the standards and are tied to specific orders (except for liquid, glue type, etc., which are issued with whole bottles, but not more than the issuance norm). Soles and insoles are also issued on order, with the binding of the soles issued to orders at the time of transfer.

With the introduction of 1C:ERP Enterprise Management, First Bit provided:

• Operational monitoring of production operations.
• Minimum downtime of semi-finished products between rework, which reduced the total time of completion of each order and the total time from order to release of finished products.
• Minimum errors in the calculation of piecework wages by automatically collecting information about the production operations of a particular employee as part of the overall production process.
• Transparent accounting of materials and semi-finished products, which allows you to make operational decisions both in terms of supply and in-house warehouse accounting.
• Simple work of the warehouse and eliminated reassortment.