Residentia Group finds a better way to manage growth with MYOB Acumatica
Residentia Group is a leading supplier of electrical appliances to retailers throughout Australia, including Bing Lee, Betta Electrical and Buyrite Group.
The company established a strong position in the market quickly. Its turnover tripled in its second year of operation and continued to double in successive years.
“Our competitive advantages are a low-overhead business model and a good product range across the price spectrum,” says Co-founder and Director, Nathan Cary.
“We have two of our own product brands and have exclusive distribution rights for two of Europe’s largest brands, Teka and Elica.”
As the business continued to grow, Residentia needed a more powerful system to manage its financials, inventory, supply chain and customer relationships. The company chose MYOB Acumatica as its cloud ERP platform.
When growth started to expose system limitations
Residentia initially used a user-friendly cloud-based technology stack. Xero handled financial management while Unleashed was used to manage inventory.
“It was good for us at the time,” Nathan recalls. “There was a certain amount of automation for month-end processes and third-party apps could connect easily to it.”
However, Residentia's rapid growth soon exposed limitations in its existing systems.
“Xero's performance in terms of speed was really slowing down at peak times,” says Nathan.
“For instance, we might want to process about 500 invoices all at once and it couldn't cope. Also there was a discrepancy in the way that Unleashed and Xero valued stock. Each system would deliver a different figure.”
The disconnect between finance and inventory created additional work for staff, who increasingly relied on spreadsheets outside the core systems.
Residentia's warehouses across Australia were managed by a third-party logistics provider. Orders were often handled through email, creating the risk of errors that might not be discovered for weeks.
Payment reconciliations were another time-consuming process. At the same time, some of Residentia's larger customers wanted the company to adopt EDI trading, which was difficult to implement across its separate systems.
“We felt it would start to affect our competitiveness moving forward,” Nathan says. “We wanted to be at the forefront of EDI, we wanted to be easy to deal with and we didn't want to have to employ more staff.”
“We wanted to be at the forefront of EDI.”
Moving to an integrated cloud ERP
Residentia brought in a systems consultant to review its ERP requirements. The company wanted to remain with a cloud-based solution to avoid infrastructure costs.
Microsoft Dynamics NAV and SAP Business One were considered, with SAP initially close to being selected. After the MYOB Partner introduced Residentia to MYOB Acumatica, the company found it offered the capabilities it needed.
“It ticked more boxes for us than any of the other systems we looked at, being a true cloud-based system that was already set up for Australian payroll,” says Nathan.
“We could also see that it had the capacity to handle future growth.”
Residentia also implemented Netstock for inventory optimisation and a B2B Gateway for EDI and electronic communication with customers and its third-party logistics partner.
“MYOB Acumatica ticked more boxes for us than any of the other systems we looked at.”
Electronic trading delivers major efficiencies
With MYOB Acumatica and its integrated solutions in place, Residentia's customers and suppliers could connect electronically.
Automated processes significantly reduced the time and paperwork involved in day-to-day administration. Statements could be scheduled automatically and formatted to meet individual customer requirements.
“That EDI integration is a huge benefit for us,” Nathan says.
“Netstock is another big positive for inventory management because we're truly able to forecast our requirements and see where we've got too much stock.”
The integration between the systems also helped Residentia identify excess inventory and potential stock shortages, allowing the business to make more informed purchasing decisions.
Better visibility across the supply chain
MYOB Acumatica's reporting capabilities provided Residentia with live information across the business and a clearer view of its supply chain.
“The data visibility is vastly better and the graphic displays are very helpful,” says Nathan.
The cloud-based platform could be accessed from anywhere, while mobile functionality helped the back office work more efficiently. Sales representatives could submit expense claims remotely, while the integrated system also supported foreign currency transactions.
By bringing financial management, inventory and operational processes together, Residentia gained a more connected view of the business.
Built for future growth
Residentia had ambitious plans for further expansion, including entering the New Zealand and UK markets and establishing a sourcing office in Asia.
MYOB Acumatica's ability to support multiple businesses and branches provided a platform for the company to continue expanding its operations.
“Replicating our business model in other countries will be our biggest challenge,” Nathan concludes.
“MYOB Acumatica is positioning us to continue our trajectory of growth and we like to think it's keeping us ahead of our competitors in terms of how our customers can deal with us. We're really excited about the future.”
“The data visibility is vastly better and the graphic displays are very helpful.”
