Once a company that had just one product on its inventory, SunMoon is discovering a whole new world of possibilities that an enterprise resource planning (ERP) system can bring.
It is, however, taking the time to ensure all processes and technology are optimised before exploring new business potential, according to Gary Loh, deputy chairman and CEO, SunMoon Food Company.
By most standards, the Singapore-based distributor and reseller of food products would be considered late to the ERP world, which emerged in the 1990s and saw significant adoption over the past couple of decades.
In contrast, SunMoon began its journey with Oracle NetSuite’s cloud-based OneWorld ERP suite just last year, spending USD$400,000 (£300,445) on the six-month-long implementation.
The system went live in April this year, offering the foods distributor a consolidated platform to manage its financials as well as inventory and orders across its three subsidiaries in China, Indonesia, and the US. It supported currencies for 11 markets including Singapore, Hong Kong, Australia, Malaysia, and Thailand.
The need for a system to help manage its business processes became apparent when the Singapore company expanded its inventory from just one to 100 SKUs (stock keeping units). Previously selling only apples, SunMoon now offered a range of fresh fruits and food products including juices, fruit-based snacks, nuts, and frozen fruit sticks.
Through its customers, which include supermarkets, convenience stores, and online marketplaces, SunMoon products are available via 11,000 sales points worldwide including Southeast Asia, China, and the Middle East. Its clients included Alibaba’s Tmall.com Yiguo.com in China, Singapore’s Cold Storage and NTUC FairPrice, as well as Carrefour and Giant across Southeast Asia and Amazon.com in the US.
Some 30 products already were available in all markets its customers served, with the remaining 70 SKUs sold mainly in Singapore and China. It planned to make all its products available across all markets within a year. The company also sold its products via its own online store.
No legacy, no implementation fuss
Thanks primarily to its prior lack of technology adoption, SunMoon did not have a lot of legacy systems and, hence, was able to implement the NetSuite ERP software without much hassle.
According to Loh, his employees used to carry out most tasks via email, including sending out quotes and purchase orders and responding to queries. Purchase order sheets and invoices also were printed out on paper.
Describing the company’s previous environment as archaic and tedious, he said his staff spent hours on email communicating with customers on their orders and checking with suppliers to determine if they had the inventory to fulfil the orders. The necessary data then had to be keyed into purchase orders to be sent out, and the finance team would have to re-input the same data into invoices from suppliers and to customers.
With the ERP system in place, SunMoon’s suppliers could enter product expiry dates, packaging sizes, and other information of their fresh produce from a web-connected device into the cloud-based software.
SunMoon employees then would use the data to create quotes for customers to be previewed and approved. The OneWorld system would automatically use the data to send purchase orders to farmers and generate invoices when orders had been fulfilled.
Within the first five months of implementation, the NetSuite software processed 900 transactions and was estimated to have saved SunMoon 150 man-hours, which translated into S$20,000 (£11,161) in savings.
Asked if it was tough to get its 200 suppliers on board, Loh said it all boiled down to the value-add these companies could gain from the ERP system.
He added that with all essential data now digitised and stored, SunMoon was able to connect to its customers’ websites and online systems via APIs (application programming interfaces). “So now, information from farm to fork is captured into the system. Prior to this, we had no visibility at all”, he explained. “We didn’t know who [our customers] were selling to.”
With the data, Loh hoped to be able to analyse the information and extract insights on how the business could further improve efficiencies and better understand its procurement and customer needs.
In addition, the ERP system would lay the foundation for SunMoon to potentially tap emerging technologies such as blockchain, artificial intelligence (AI), machine learning, and even cryptocurrencies.
Specifically, AI and machine learning would enable the fruits distributor to know how much its customers were buying and selling, optimise its inventory, and work out a cost structure that determined the optimal price at which to buy and sell.
Ultimately, the main objective was to continuously achieve higher business and operational efficiencies, Loh said.
Alibaba’s management of its annual Singles Day event, for instance, underscored the high level of efficiency the Chinese e-commerce operator had to attain in order to handle such high trading volumes in a single day, he said.
If companies remained unable to optimise and run at that level of efficiency, they then risked losing relevance in future, he noted, adding that AI would play a key role in helping businesses achieve better efficiencies.
For now, SunMoon was focused on acclimatising to its ERP-enabled operating environment.
Loh said: “We’re still quite new in all of this so we want to make sure all the technology and processes are fully optimised. This transformation is really quite significant for us. It’s still the same earth [we’re operating on], but it’s so different for us… it’s like moving from the dark and coming into the daylight. We see things a lot clearer now.”