KANSAS CITY, MO — A sure sign of growth for an early-stage brand is the need to migrate the management of core business processes from multiple spreadsheets to a comprehensive system that can accommodate the increasing complexities that go hand-in-hand with a growing business.
“Some of the more complex businesses tend to need an inventory management solution sooner than other because they have more moving parts,” said Scott Thompson, director of partnerships at Wherefour, a cloud-based enterprise resource planning (ERP) platform for emerging brands, during a live workshop hosted by Julie Pryor, CEO of EmergeCPG.
ERP platforms can help streamline functions such as inventory operations, material requirements planning (MRP), forecasting, compliance, traceability and cost tracking. Cloud-based ERPs give manufacturers access to this data in one place in real-time from anywhere and on any device.
“By having all your inventory operations in one system — purchase orders, inventory costs, labor costs, production, order fulfillment — you can analyze the impact on your profit margin and use the information as a tool to cater your business for future success,” said Thompson, who counts Fat & Weird Cookie and Grateful Bread among Wherefour’s clients.
Cost-tracking and forecasting
For early-stage brands, keeping an eye on costs for essentials such as ingredients, packaging materials, labor and shipping is critical. A comprehensive ERP system can provide the whole picture, from the true cost of a specific item once labor is factored in, to why costs are steadily increasing, to the profit margin on recently filled orders.
It can also help with MRP and forecasting, allowing manufacturers to better prepare for seasonal events or periods of slow business.
“Some bakers only need to plan for a week or two ahead, while others may want to look at a full year,” Thompson said. “Whether it’s drawing on historical data or forecasting increases in demand, an ERP system can quickly analyze data to help manufacturers plan ahead.”
Traceability
Traceability is another critical area in which an ERP platform can provide benefits, especially as many large retailers such as Whole Foods Market, now require their suppliers to have a traceability system in place. Additionally, the January 2026 compliance date for the FDA’s FSMA Rule 204, or the Food Traceability Rule, is right around the corner.
Thompson noted that in the event of a product recall, it’s not just time that’s of the essence … it’s also a matter of money. He shared the story of a business owner who had to discard $300,000 worth of inventory during a product recall because they couldn’t properly identify which specific lots and finished goods were affected.
“An ERP can help track and pinpoint which specific raw materials were used in the finished good,” Thompson said. “It can do so quickly and automatically, so it saves manufacturers time because they don’t have to manually do that process across several spreadsheets. It also helps them become audit- or recall-ready.”
As for knowing when it’s time to upgrade from spreadsheets to an ERP platform, Thompson said it depends on the business.
“There will usually be an indication it’s time to move to an inventory management solution,” he said. “Maybe your cycle counts are always wrong or you’re having trouble planning out production, tracking costs or purchasing materials in the right amount of time. That’s when you know it’s time to look at a new solution.”
EmergeCPG, for which Thompson serves as a mentor, offers early-stage entrepreneurs access to industry leaders, 1:1 coaching and live monthly classes to help grow their businesses.
