Business operations of the service industry vary from business to business. To broadly classify, some businesses are purely into services like consultancies, who generally do not need to manage inventory. On the other side, some businesses are in the service industry, but deal with inventories as well. For example, businesses who are into automobile servicing, whose primary nature is service, but also sell spare parts as a part of overall delivery. No matter what nature of service business you are dealing with, ERP for service industry plays a crucial role in enhancing the efficiency and productivity of your business.
ERP for Service Industry
Depending upon the nature of business and the operation, the complexity of managing business varies. If you are purely into a service business, the primary need can be managed billing and receipts from the clients, but there are other areas such as costs, receivables etc. that need to be managed. If you deal with inventory while the primary nature of the business is of service, the needs and complexities get amplified. Here is why ERP for service industry plays an important role.
| What is ERP? | Types of ERP Software System |
Why Service Industries need an ERP Software Solution?
Below are some of the key reasons why service industries need an ERP software solution.
- Billing and invoicing
Whether you are rendering pure services or into a service segment that requires you to manage inventory, invoicing/billing is a crucial aspect of the business. Using ERP software solution for service industry, you can easily record, track, and manage the invoices. The software solutions that are built for small and medium service business comes with different types of invoices formats and configurations that help you customize the way it works for your business.
- Bills receivables
Bills receivables are the invoices that are yet to be paid by your customer. Bills receivables are the key source of cash inflow and contribute hugely towards the working capital requirement of the business. The longer an invoice sits as accounts receivable, it blocks the cash flow and lesser availability of cash to meet your business needs. Using ERP software for services business helps you keep a clean track of receivables, how long they are pending from and help you follow up with your client. Take a look at the best techniques to Manage bills receivable efficiently.
- Track and manage inventory
This is extremely crucial for businesses that not just render services, but deal with inventory as well. The complexity here is that some service business uses their own inventories like automobile service business providing repairs and maintenance service uses their spare parts as part of completing the service. On the other end, you have businesses rendering service and use the components/inventories provided by their client like in the case of job work.
To make it even more complex, you might come across situations, where you must manage your stock as well as the stock provided by your client alongside rendering the required service. ERP software solution is not only built with features to manage your books but also includes the features of inventory management software that help you handle such situations easily.
- Project costing and Tracking
It’s quite a common scenario that service businesses manage the delivery by projects. Here, all the cost, material consumption and revenue attributed to the project to track the revenue. Using ERP software will help you create multiple projects, track cost, including material consumption till the time of issuing an invoice.
- Tax compliance
Depending upon the tax compliance, such as GST in India, VAT in UAE, Saudi Arabia and other countries, businesses need to be compliant right from generating the tax compliance invoice to managing the books of accounts to filing returns. ERP software solution for service business comes with an inbuilt solution to manage tax requirement of business easily.
Benefits of using ERP software for service industry or business
- Ease of Invoicing/billing
- Record invoice along with inventories that are used in service completion
- Manage bills receivables and frequency of payables efficiently
- Store and track inventories that used in rendering services
- Easily manage employee payouts and related records
- Project-wise cost and revenue tracking
- Integrated books of accounts across all functions
TallyPrime as an ERP solution for service industry
TallyPrime is a complete business management software that helps you manage the complete needs of your service business. Using TallyPrime, you can manage invoicing, accounting, inventories, payroll, banking, cash flow and much more in an efficient way. Here are some of the key features of TallyPrime for service business
- You can maintain books account for pure services (without inventory) as well with inventories as it suits your business
- Multiple Invoice formats for recording pure service invoice and inventories
- Multi-currency support to generate the invoice in different currencies
- Create, track and manage multiple projects simultaneously
- Manage own stock as well third party stock easily
- Salary processing and employee management
- Insightful business reports related to finance, accounting, inventory, and management control reports
- Automated bills receivables and payable management
- Host of utilities to manage your banking needs
- Access business reports on any device, anywhere
The robust features of TallyPrime understand your business needs, simplifying the lives of businesses through simple to use software, insightful reports, multi-task capability and much more. This is something that is loved by our 2 Million + customers across the world. Take a free demo and experience yourself.
Read more about ERP software solutions
ERP Software for Manufacturing Industry, Inventory Management software, ERP Software for Distributors & Wholesalers, Small and Medium Business ERP software
