Hawthorn Trading Company was established in 1986 by Stephen Melhuish as a steel stockholding and shearing company. With over thirty years’ experience in purchasing and working with steel, the company has grown into a successful manufacturing business with a family background, and now has two sister companies giving them greater control over their supply chain.
Background
Having grown to a certain point, lack of visibility over transactions was the driving force behind the search for a new ERP system. Initially using Excel and Sage, only two people could see any transaction, which was limiting their visibility into the state of the business. As the founder of the company, Stephen had an in-depth knowledge and understanding of every aspect of the business, but this meant that, now as a second-generation company, management couldn’t access the data to grow the business in the future. Kitty Kinsella, Stephen’s daughter and Managing Director says, “we wanted to be able to give Dad the ability to step back a bit after over thirty years in the business, but we need the data from his head to carry on his work.”
Hawthorn Trading Company took the decision to implement SAP Business One to provide the insight they needed to keep better control of their cashflow, automate manual processes and support strategic decision making. It has given them the transparency to see what is going on in every part of the business and means that Stephen can concentrate more on strategy and being the ‘brains’ behind the business, with real-time insight to support this.
Implementation
Although they initially wanted SAP Business One to manage stock control and finance, Hawthorn Trading Company has optimised their use of the solution over a couple of years to cover production as well. They are now using a scanning solution called iSAP Scanner, from Interconcept, which has streamlined their production and admin processes by automatically capturing data from the production line and feeding it straight into SAP Business One. Where previously, admin staff had to manually enter production information, they are now able to focus on roles that have more business impact, while empowering production staff with the tools that help them do their jobs more efficiently.
Kitty says, “iSAP Scanner enables us to get real live information quicker and with more accuracy. It means that the users, who are ‘at the coalface’ have real buy-in to the system and can come up with ideas that help improve processes. It makes us more agile – we’re growing organically and as it’s so adaptable, if something changes or can be done better, it can be easily changed to take new processes into account.”
iSAP Scanner was initially introduced for barcode labelling and scanning to speed up the processing of data from production, but because of the way it communicates with SAP Business One, it means they have been able to automate orders and payments on their website. These used to take a lot of time to process, but now means that two of their inbound sales staff can focus on outbound sales.
Benefits
SAP Business One has delivered a number of benefits to Hawthorn Trading Company, supporting their growth to a new site and investment in new machinery, as well as adding a second shift, which has increased the workforce by an extra forty people.
It has given them greater insight into their cashflow and enabled them to make savings on consumables by negotiating contracts with suppliers to guarantee supply and get better prices. Kitty says, “we have much better purchasing power because of the data we have from SAP Business One. We used to spend a lot of money on PPE but just by switching supplier, we saved £13,000 in the first quarter.” It has also given them the insight to react to market trends, so they don’t lose out when the steel market fluctuates and are able to pass on cost savings to their customers while still protecting their margin, which gives them a competitive edge.
In terms of efficiency savings, Kitty says they have saved about £50,000 in process improvements reducing accounting and admin costs, but repurposing staff into sales to generate revenue. She estimates they will save the same again over the course of the second year since the system went live, and revenue has increased by 20% over the past year. SAP Business One has supported them to capitalise on new opportunities and diversification into new markets from the insights it has provided. Kitty says, “we made the decision to implement SAP Business One when the business was small and it has given us the foundation to grow.”