When it comes to purchasing, contractors can deal with hundreds, sometimes thousands of parts and materials on each job. With moving targets on pricing and quantities needed, purchasing can be a tricky task that can affect both the timeliness of projects and a contractor’s bottom line. Perhaps no one knows that more than Pieper-Houston Electric L.P.’s Aaron Thomas.
Thomas, accounting assistant of the Houston, Texas based company said that the manual processes for purchase orders that were in place prior to implementing Spectrum’s purchasing and inventory capabilities were just not cutting it. “Before, we used to hand-write purchase orders,” he said. “The orders coming in from the field were largely via phone call or maybe a fax machine. We really didn’t have laptops out there in the field at the time, but even if we did, the order would then have to be written out and then faxed or emailed to a vendor.”
There was some tracking of purchase orders using phase codes, but it was also a slow process, waiting on the orders to be received, submitted and fulfilled before they could be reasonably tracked. Additionally, Pieper-Houston did not have the depth in the phase code tracking it wanted to.
When the company began tying together different areas of its operations — accounting, project management, purchasing, etc. — with Spectrum, Thomas realized he could further streamline operations by making it easier to generate purchase orders.
Spectrum has really helped us maximize our purchasing and material tracking capabilities. Spectrum is very user-friendly and having it used across the company allows us to be a lot more detailed with how we approach jobs and a lot more intelligent about how we’re spending time and money.— Aaron Thomas, Accounting
“I created a form with about 300 of our most common items that our technicians order day to day. Basically, all they do is scroll down the list of common items, purchasing department,” Thomas said. “Our purchasing department then creates a purchase order and sends it to our vendors. The vendors send back a confirmation and then a purchase order is created.
Pieper-Houston then uses Spectrum’s inventory functionality and applies item codes to its purchased materials for better financial and job cost tracking. “We’re able to track items, the cost of the items, and the frequency with which we buy them. We’re also able to track which project they are going to using phase codes. These are really important to us with material and labor. We weren’t able to get the depth of phase coding before. For example, we have common codes for a breakdown of materials into branch materials, site material, service materials and trim materials, but then from there, you can break each one of those phases down into what floor of a building its going into, what area, or if you have more than one building on a job, you can have building A or building B,” Thomas said.
This level of materials and purchase order tracking allows Pieper-Houston to see how well it estimated its jobs, analyze its spending practices and ultimately put together better bids. “We’re not only able to win more jobs, but our jobs are a lot more profitable. In the past, they might have been missing key estimate data and the jobs would end up less profitable,” Thomas said.
The company is also saving time and labor costs. Foremen and project managers are spending less time ordering materials and more time planning the jobs. Meanwhile, Pieper-Houston was able to reduce its purchasing department responsibilities and redirect work efforts to other areas.
“Spectrum has really helped us maximize our purchasing and material tracking capabilities,” Thomas said. “Spectrum is very user-friendly and having it used across the company allows us to be a lot more detailed with how we approach jobs and a lot more intelligent about how we’re spending time and money.”