What is Process Manufacturing?

Updated: December 29, 2010

In process manufacturing, there is not only a recipe or formula for the preparation of the product, but also for the packaging of the product specific to customer orders. This portion of the formula or recipe contains steps for filling the product to meet a finished goods order, such as 16 oz bottle with a cap and label. The label could be branded to the customers' private branding. Although in process manufacturing, the products are usually created in bulk, the manufacturer may not deliver the product to the customer in the same way. This bulk is usually kept in a tank or tote as an intermediate and then a fill ticket can be generated from the demand of a sales order. The fill ticket is like a recipe or formula or even a bill of material to tell the picker how to package and ship the finished good. If anything were to change in this process, there are ways to keep track of the recipes and formulas for future (long term) efficiency and effectiveness. With process manufacturing, an important component to consider and keep in mind is that the formulas used must be organized, controlled and input in the computer. A prominent question for the manufacturer to ask would be is the inventory being controlled as it should be? Do I know how much raw material or finished goods I lost in processing or filling? Inventory control and costing is a key component for process manufacturers to truly understand profitability by finished good.

Needing to see the physical properties, inventory costs, labor costs, containerization, quality of the raw materials and finished goods is critical to product development process all the way through to the final production management. Process manufacturers should also maintain the aim to meet the requirements for customer satisfaction. All these things would be factors of an ERP (Enterprise Resource Planning) system which would consolidate all business operations into a uniform and enterprise-wide system environment. In other words, with ERP, a manufacturer can successfully in one system control and manage the customer relationship management, manufacturing, supply chain management, financials, project management, human resources, data services and access control. A cost effective way to implement the ERP software would be to hire outside consultants (solution suppliers) who are professionally and adequately trained to implement these systems which are at times considered to be too complex for someone to handle in-house such as the developer on site. Let's say there may be a question on the implementation or the ERP system or software in general that someone without the proper credentials within the company couldn't answer; having a solution provider to rely on would prevent any potential unanswered questions or concerns to cause future problems. Another option would be to implement your ERP in phases. A good consulting firm with experience in your industry can advise you on the best options and priorities for your company.

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