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Guide

What a manufacturing ERP should include

Almost every factory we work with asks for the bill of materials first. Here is why it comes first, what should follow, and where ready-made systems tend to fall short.

By Peter Pandiraj.M, Tech Head, 25 years of experience. Published 6 November 2026.

Start with the bill of materials

We have built software for manufacturers of shoes, cars, metal, defence items, food and dresses. These businesses work very differently, but the first request is nearly always the same: a bill of materials, or BOM.

The BOM lists every material and part that goes into a product and how much of each is needed. Purchasing, stock, production and costing all depend on it. If the BOM is wrong or kept in a spreadsheet that only one person understands, every report built on it will be wrong too.

A useful BOM should handle versions, sizes or variants, and the scrap or wastage you normally expect. A shoe in ten sizes and a metal part cut from sheet need very different details, so check this with your own products.

The modules that usually follow

Once the BOM is in place, most manufacturers need these modules, in roughly this order:

Inventory: raw materials, work in progress and finished goods, by location, with reorder alerts.

Purchasing: requests, approvals, purchase orders and goods received, checked against the BOM.

Production planning: what to make, when, on which line, and whether the materials are available.

Quality checks: inspection points at each stage, with a record of what was rejected and why.

Costing: the real cost of each job, using actual material, labour and overheads.

Dispatch: packing, delivery notes and invoices, with a view of what is ready and what is late.

Where ready-made systems often fall short

Ready-made ERP can work well when your process is close to its standard design. Manufacturers we speak to tend to raise the same three problems.

Your production stages do not fit. Your real stages, approvals and rework loops may not match the fixed steps in the product, so staff end up tracking the difference on paper.

Too many unused screens. A large product can show many fields and menus a shop floor team never needs, which slows them down and makes training harder.

Costing does not match how you work. If the system calculates cost differently from how you price jobs, finance often goes back to a spreadsheet.

None of this rules out a ready-made product. It does mean you should test your own hardest process in a demo, not the vendor sample.

Questions to ask before you choose

1. Can it follow our actual production stages, including rework? 2. Does the BOM handle our sizes, variants and wastage? 3. Can we see the real cost of a job, not only a standard cost? 4. Will shop floor staff be able to use it with little training? 5. Can we start with one area and add the rest later?

Roll it out in stages

You do not need to go live with everything on one day. About 80% of our clients start with one module and add more later. For a manufacturer, that usually means the BOM and inventory first, then purchasing and production.

This limits the risk, gives staff time to adjust and lets you correct problems before they spread to other departments.

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