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| A flexible, enterprise
resource planning (ERP) system has aided Comtrex
Systems Corporation in boosting the efficiency
of its manufacturing and distribution operations.
The software's Material Management module
ensures that necessary raw materials are in
stock or ordered when they need to be. The
Inventory Control and Purchasing modules allow
just-in-time receipt of parts from vendors,
while the Job Scheduling module permits a
quick response to customer orders. The software
includes the ability to "backflush"
the inventory, allowing Comtrex to maintain
a highly accurate inventory database with
just a few keystrokes. As Comtrex has evolved
from manufacturing proprietary products to
assembling off-the-shelf parts, its ERP system,
Expandable ERP from Expandable Software, Santa
Clara, California, has been flexible enough
to accommodate the shift. It has also been
extremely reliable. "We use it every
day, and not once in the entire 10 years has
it ever crashed," says Rene Burckhardt,
director of operations at Comtrex. |
| Comtrex designs, develops
and manufactures information systems, including
point-of-sale (POS) terminals, peripheral
equipment, and software. Its primary market
is the food service industry. Customers for
Comtrex Systems include full-service restaurants
such as Ponderosa Steakhouse, quick service
food establishments such as Wendy's, cafeterias
and institutional food service operations.
Comtrex was founded in 1981, and has installed
more than 40,000 Comtrex POS terminals worldwide,
representing approximately 10,000 installations.
The company's manufacturing, assembly, and
development activities are located at its
headquarters in Moorestown, New Jersey. |
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When Comtrex first started out, the company's
product line consisted exclusively of POS
terminals. These devices contained integrated
circuits, printed circuit boards, and numerous
other parts, nearly all of which were produced
in-house in a variety of different manufacturing
processes. Comtrex management first considered
using an ERP system in early 1990. They
didn't base the selection process strictly
on a feature-by-feature comparison. "If
you buy solely on functionality, you will
look forever because every month someone
comes out with a new feature," says
Jeffrey Rice, president and CEO of Comtrex.
Instead the company focused on the quality
of the support they could get from the ERP
software vendor. In this respect, Expandable
stood out. They send their own representatives
to assist in the system implementation.
This practice not only eliminates the need
to find and hire a consultant, it also ensures
the involvement of people who are highly
trained in the ERP system. The people from
Expandable are experts in every detail of
their own software. Expandable also provides
training for the ERP system.
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| The ERP system included
all the capabilities Comtrex needed such as
materials management, financial applications,
scheduling, and inventory. The company required
no customization to the system, with the exception
of tailoring some of the canned reports to
match a preferred format. Once the system
was up and running, management began relying
on it to support the growing business. Comtrex
used the system's financial modules, including
the General Ledger, to manage business operations.
They used many of the manufacturing modules
to manage activities on the production floor. |
| The system's Material
Management module is particularly useful because
it helps coordinate parts coming in from outside
suppliers. For example, when Comtrex was selling
mainly proprietary products, they worked with
metal companies that built the metal cabinets,
painting companies that put the finish on
the cabinets, and plastics manufacturers.
Each of these suppliers required a certain
amount of lead time. Even today, for the 20
percent of the products that are manufactured
in-house, they must coordinate suppliers and
lead time. Comtrex has set up the Materials
Management module to include all lead times
so production managers always know how long
it takes to obtain a particular part. |
| Over time, Comtrex switched
to buying off-the-shelf components rather
than manufacturing everything in-house. "Currently
80 percent of our business involves sub-assemblies
from Taiwan that are put together and tested
here in our facility," explains Rice.
The remaining 20 percent of the company's
product line involves equipment manufactured
in-house. Even though their methods changed,
management never considered replacing the
ERP system. Their current system suited the
new business model equally well. Also, the
company was very pleased with the support
they were continuing to receive from the vendor.
"We stayed with them and will continue
to stay with them because of the support,"
says Rice. "They have knowledgeable people
who understand the system and we can always
reach a real human being in five minutes.
We only call them two or three times a year,
but if we have a question that takes several
hours to solve, they stay with us on the phone
until its done." |
| Today Comtrex uses the
same financial applications in the ERP system
that it used originally. But in addition to
the Materials Management module, they now
rely on other modules such as Inventory Control,
Purchasing, and Job Scheduling for managing
production and distribution. When an order
is received, an order entry clerk enters it
into the Sales Order module. This module generates
a pick ticket that is given to the production
manager. He and Burckhardt, the director of
operations, determine which parts are already
in-house and which need to be ordered. They
do this by running a "component availability
report" using the Inventory Control module.
This report, which is available immediately,
automates what would otherwise be a time-consuming
and potentially inaccurate process. Instead
of manually comparing a list of items needed
to process a certain order against an inventory
list, they simply identify the job and run
the component availability report. The ERP
system compares the bill of materials for
that job against the inventory and prints
out a list of the items not in stock. |
| In the meantime, Burckhardt
uses the Job Scheduling module to issue a
"pull" for the product that is going
to be built. The software automatically identifies
all the necessary components for that pull
and prepares a Kit Shortage report showing
the quantities of the parts that are not in
stock. The next step is to generate purchase
orders for the short items using the ERP system's
Purchasing module. This module draws information
from a master vendor list to automate the
placement of POs. All the user needs to do
is specify the desired quantity, which comes
from the Kit Shortage report. The system was
set up this way, rather than having the ERP
system enter quantities automatically, to
allow Comtrex to take advantage of volume
discounts. For example, even though they might
need 10 of a certain part to complete a job,
they may prefer to order 50 to get a discount.
Often while preparing purchase orders, Burckhardt
is also using the Inventory Control module
to see what is on hand so he can adjust orders
to get the best deals. The Purchasing module
generates a Purchase Order status report,
which Burckhardt reviews weekly to see what
material should be coming in. |
| Once a shipment arrives
from a vendor, someone in the Receiving Department
enters that information into the ERP system.
This entry increments the part's inventory
quantity. The entry also updates the Kit Shortage
report, showing the part has been filled.
Once all outstanding items have been received,
the job commences. Printed circuit board assembly
kits are sent to a contract manufacturer.
After the build is finished, the ERP system
is updated with a Work in Progress completion
entry, which indicates the subassembly is
now in stock and ready for final assembly.
The final assembly and testing is performed
to satisfy a specific sales order requirement.
The production manager enters a final process
known as backflushing. Backflushing relieves
the sub-assemblies and other components from
inventory and increases the on-hand quantity
of the final product. Upon shipping, the Sales
Order module decrements the finished goods
inventory and transfers the costs to a cost-of-goods-sold
account. |
| When Comtrex needed to
upgrade its ERP system to a Y2K compliant
version, the company again called on the vendor
for help. They expected the transition to
take three or four days because, in addition
to upgrading the software, the company was
also installing new hardware-- Pentium III
450s, Windows PCs. Expandable completed the
upgrade in three hours. "They took all
the data we had accumulated in the ERP system
over nine years, including 5,000 parts on
file, and had it transferred into the new
version in half a day," says Rice. "We
ran the two systems in parallel for a few
days, but we never had a single problem. I
can't tell you how pleased we are with Expandable's
people and their service." |
| For more information about
Expandable, contact the sales department at
408-261-7880 or by email at sales@expandable.com. |
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