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    Production

    Production planning in Uniconta for SMEs

    Production planning decides what you make, when, with which materials and with which people and machines. In a small manufacturer it often lives in a spreadsheet and in the head of one colleague. This page explains how production planning works in an SME, where it usually goes wrong and what Uniconta is confirmed to cover.

    How it works

    How production planning works in an SME

    It usually starts with a sales order or a stock shortage. A furniture maker receives an order for twenty dining tables, or a food producer sees finished goods drop below the level it wants to hold. That demand leads to a production order, an instruction to make a given quantity of a product. Every finished product has a bill of materials listing the raw materials, semi-finished products and components it needs. A bill of materials can be nested, because a semi-finished product is itself made from components.

    Then the materials have to be available. If there is enough stock, production can begin. If not, purchasing has to act, and that requires a clear picture of what has been ordered, what is already in production and what demand is expected. Larger manufacturers calculate this with MRP, material requirements planning. Smaller firms work from a reorder list and a lot of experience. Either way, the plan is only as good as the bills of materials, the stock records and the open purchase orders behind it, so they need to sit in one place.

    The real work happens on the shop floor, and that is where plan and practice drift apart. An order is reported partly finished, more raw material goes through than planned, or an operator switches between two jobs. If you record actual consumption and the quantities actually produced, you can support the cost price of each product and adjust the plan. Capacity matters as well. You only know whether a delivery date is realistic when you know how much work is already waiting and how many hours or machine slots are available to do it.

    An example makes this concrete. A small producer of wooden toys accepts an order from a retail chain. Before delivery, the wood, paint and packaging must arrive in time and the workshop must have enough hours free. If the bill of materials is right and stock is up to date, you can see within minutes what is missing. If not, you discover the shortage only when production has already stopped. Planning is first of all a matter of reliable basic data, and only after that of clever calculations. So start small and make sure items, bills of materials and stock are correct before you refine the planning.

    What often goes wrong

    What usually goes wrong

    Small manufacturers tend to run into the same few problems.

    • Bills of materials that are out of date

      A recipe or parts list is changed in the workshop but not in the system. The calculated material need then differs from what is really required.

    • Planning spread over separate files

      Orders, stock and purchasing sit in three different spreadsheets. Nobody can see at a glance whether there is enough material for the orders that start this week.

    • Material use that is never recorded

      If only the finished product is booked and not the material used, stock drifts away from reality and the true cost price stays hidden.

    • Capacity that shows up too late

      Without a view of the work already queued, a delivery date is promised on instinct. That creates peaks and late deliveries.

    • Ordering too late

      A shortage of one component stops an entire order. Without a reorder list, someone notices only when the material is already needed.

    In Uniconta

    What Uniconta covers here

    Uniconta is cloud-based ERP and accounting software and includes a production module. In it you create production orders, including from a sales order line. A production order can be reported partly or fully finished, and actual material consumption is recorded. You can use production groups, and there is a link to projects.

    Bills of materials can contain raw materials, semi-finished products and components. Phantom items allow nested bills of materials, and variants can be used in production orders. Production data is intended to help plan work and capacity. There is also a reorder list based on stock, open purchase orders, production orders, components and expected demand.

    What we do not claim matters just as much. We do not say Uniconta is a full MRP system, and we do not promise routing, scheduling optimisation or shop-floor terminals. If you need those, we discuss it up front and look at whether a separate system suits you better.

    Our package

    Which package this belongs to

    Production planning belongs to the Operion Uniconta ERP standard package, with a fixed scope and a fixed price. We set up proven software to a fixed standard. We do not customise Uniconta. That is why we can give a fixed price.

    What exactly falls inside the scope of your package is agreed beforehand, and the scope is fixed before we start. You know where you stand from the outset, with no surprises halfway through. If you also run a warehouse, BizBloqs can play a part, and its connection with Uniconta is standard.

    Read on

    More about Uniconta

    Terms for this topic

    Bill of materialsMRPCost price

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