When Investors Business Daily wanted to know how smaller and midsize companies are using ERP, they went to MAPICS. There's good information here for people who are looking at MAPICS for the first time. MAPICS is able to maintain high levels of sales growth and profitability by delivering the software that smaller and midsize companies need at a competitive price and in a shorter time frame than the larger ERP companies.
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Investor's Business Daily - Computers & Technology (11/18/98)
Smaller Firms Get Directions From Mapics
By Matt Krantz
If you want to sell goods to Wal-Mart Stores Inc., you must do business its way. And the nation's top retailer doesn't care if you're a big company or a small fry. Wal-Mart requires that your computer system be advanced enough to link with its systems.
That's easy enough for large suppliers of retail goods. But it's more taxing on smaller suppliers with limited technology budgets. That's where Atlanta-based Mapics Inc. comes in. It sells enterprise resource planning software that lets small and midsize companies hook up with the Wal-Marts of the world. Its customers include water filter maker Culligan International Co. in Northbrook, Ill.
Mapics Chief Executive Richard Cook recently spoke with IBD about how smaller companies are using ERP, software that automates back-office tasks like accounting and human resources.
IBD: Are smaller companies being forced to link their systems with bigger firms like Wal-Mart?
Cook: Yes. In fact, we have an application called electronic commerce. If you install Mapics, you can (hook up with large retailers) by buying an additional module. It has all the (computer) translations used by companies like Wal-Mart and Kmart.
IBD: Do smaller companies need different ERP programs than larger companies?
Cook: They're less willing to take risks (with ERP software). (For that reason) implementation (of our software) takes from three to 12 months, depending on the complexity. That's much less than the other (ERP software vendors), who are used to a long implementation cycle. These vendors are only now getting out the technical shoehorn to make their software work for smaller companies.
IBD: How do you sell ERP software to smaller companies?
Cook: We have a unique sales channel. We have deals with re-marketers in 70 countries. (These) are local professionals who understand what the customers need. They sell the Mapics software, install it, do product education and training, and do the database conversion.
For example, one of our customers is Pepsi in Guangzhou, China. Our (re-marketing company) there was a set of Chinese individuals who live in Guangzhou and who understand how business is done in China. They also have a localized version of Mapics.
We have 85 such affiliate companies in 70 countries. They are entrepreneurial and run in the local area. And they're lower- cost providers than the providers that deliver for SAP (a Mapics rival and the largest seller of ERP software) and the like, charging about $1,200 a day. If you try for an SAP implementation, the rookies (charge) $1,500 and top consultants $3,000. Those are sticker-shock prices for a $20 million to $500 million company.
IBD: Is Mapics ERP software less powerful than SAP AG's?
Cook: Our product was designed from the ground up for midsize manufacturers. But we're adding features so they can get things that'll help them compete against large players.
We've introduced a supply-chain program. We did this by partnering with someone that would be considered competition, Symix Systems Inc. Symix also is focused on the midmarket.
By both of us working on the program and sharing the costs, we'll deliver function at a lower price than the larger players. We're delivering an advanced planning and scheduling system that looks like (software made by) I2 Technologies Inc. (high-end software that works with high-end ERP software). But our application sells for 25% less than the cost of I2.
IBD: Is it odd to partner with a rival like Symix?
Cook: We're only occasionally competitors. In the midmarket, the customers decide very early if they want an AS/400 (a minicomputer and operating system made by IBM Corp.) or Windows NT (an operating system from Microsoft Corp.).
We only sell software for AS/400. Symix only sells NT or Unix (another operating system). We will, in a couple of years, have a program for Windows NT. But there's money to be made by sharing the development costs in the next few years.
IBD: When will you start selling a product that works on NT?
Cook: We have seen the need to go to an open- systems platform (like Windows NT). We will release this in mid-2000. NT today is a bit too leading edge for our customers. If you're a midsize manufacturer and need to sleep every night, NT is not for you yet.
Waiting for the next version of Windows NT is not a good option. If you're selling product to Kmart or Wal-Mart and they tell you they're only sending orders (to their suppliers) electronically, and you don't have a way to receive electronic orders, you've got to (move now). |
