MegaGroup, a fast-growing manufacturer and distributor of lifestyle products, has implemented the Sage ERP X3 business application suite to serve as a platform for the sustainable growth of its business in the years to come. Global group Consilia Technology worked closely with MegaGroup to implement the solution.
The group realised it would need to make an investment in business systems to support its business, after its growth of 400% over eight years started to put its resources under pressure. After evaluating a range of products, MegaGroup opted for Sage ERP X3 because the platform would be configurable and adaptable enough to keep up with the evolving needs of its business.
From its beginnings in 1997, as a small manufacturer of braais and fireplaces under the brand name Megamaster, MegaGroup has grown organically and through acquisition into a distributor and manufacturer of a wide range of lifestyle products for the southern African market.
This journey from a small enterprise to a mid-sized business demanded that MegaGroup increase its focus on governance, risk management, and process discipline, says Andre de Beer, CEO at MegaGroup. It decided to seek out a scalable and flexible solution that would provide its shareholders and management team with accurate, real-time information that would support their decision-making process.
"We have a young and dynamic team that understands the importance of using technology to manage risk and drive sustainable performance," says De Beer.
"After looking at a number of platforms, we decided on Sage because it gave us the flexibility we were looking for. We were able to start with the basic platform and plug in additional modules as we needed to."
MegaGroup initially focused on getting the core Sage ERP X3 back-office functionality in place. This has allowed the company to align its business with good processes and practices, setting it on a path for long-term sustainability, says De Beer. "Sage ERP X3 has helped us to change our mindset and prepare for the future," he adds.
The next step is to implement the Sage Inventory Advisor, which is going live in June 2014. This particular module is expected to have a massive impact on MegaGroup's business, with a fast return on investment, since it will allow it to optimise inventory management across the 700 stock-keeping units (SKUs) it manages each month.
"As an import and manufacturing business, better cost and demand forecasting will help us to become more profitable," says De Beer. "We'll be able to carry the optimal stock level for each SKU." Inventory Advisor will give MegaGroup better insight into costs, profits and stock levels across a complex business, with several factories in southern Africa as well as imported stock from China, South America and India.
In addition, Sage ERP X3 has helped MegaGroup to improve customer relationship management, helping it to keep track of queries and requirements across its large and diverse customer base. "With just-in-time sales processes required to multiple branches of national retail companies and complex manufacturing processes in-house, utilising a material number of both imported and assembled products, up-to-the-minute management of the various stock lines from its own factories and manufacturers throughout the world, accurate, complete and relevant stock information have a massive impact on MegaGroup's profitability," says Consilia CEO Johan Botes. "We recommended Sage ERP X3 as the right platform to address its business needs today while providing a growth path into the future. This solution will enable MegaGroup to keep tight control on its costs and improve visibility into its operations."
Adds Keith Fenner, Senior Vice-President Sales at Sage ERP X3 AAMEA: "Companies in the distribution industry have to meet the demands of their customers and maintain high levels of satisfaction while keeping down costs and waste. Sage ERP X3 helps them to do just that by managing levels and movements of goods across multiple sites and multiple companies. The outcome is lower inventory levels and healthier operating margins."
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