At the end of the day, when it comes to billing a customer Shepherd users, or Subscribers, are sending invoices based on two possible resources sold. Indeed, any business is. It’s either a physical product, or it is knowledge or skills. The former will be logged as an object on that invoice, while the latter will manifest as time spent.
This blog looks at how Shepherd reduces the chances for delays in billing or mistakes that then need to be rectified where calculating those physical products or materials are concerned.
Tracking Parts from Warehouse to Invoice
A long-recognised advantage of the Shepherd solution, and its mobile app, is that what happens to inventory is not a black hole. In times gone by a procurement manager would ask warehouse staff to keep them appraised of what they had and what they did not. When stocks were low, orders were placed. Sounds straightforward, but just because something is not in stock does not mean you don’t still have it.
Indeed, that part, or component may well still be in the company’s possession but in the back of a vehicle for example, or on a workshop bench. Shepherd’s mobile app made it possible to log a given part’s transition from languishing on a shelf all the way to being included in a customer’s invoice. A refreshing change from it disappearing from that shelf with the hope that whoever took it would eventually remember when and for whom they had acquired it before recording it accordingly.
That item, once out of the warehouse, is mobile but still has value on the company balance sheet. Replacing it now would be an unnecessary expense, which would also end up on the balance sheet. Multiply that across all the parts out for all the jobs and those balance sheets might be looking very different from the real-world situation.
Custom Billing Rules for Different Clients
This is further complicated by something that Shepherd also allows for: the fact that a given service contract may treat how the same part is billed differently between one customer and another. One customer may have a service agreement where parts and materials are covered; another where the parts are billed only on certain job types, but not others. The permutations are many and whatever they are, Shepherd ensures that the billing rules that apply in a given case are followed. No mistakes, no lost revenue.
Maximizing Profitability with Accurate Inventory and Billing
Shepherd, and therefore Netsuite, allow for this. In fact, the analytics included in NetSuite Inventory mean Shepherd subscribers can benefit from far more accurate forecasting and spending analyses of their parts budget. It helps them see if this aspect of their business model is profitable, just ticking along, or actually losing them money. In essence, no aspect of a part’s journey through a subscriber’s operations remains in the dark and when it is used as intended, its inclusion in billing is automatic, without delays or inaccuracies.
Let’s illustrate that with an example. A given subscriber may have ten parts in their inventory at a cost of $1000 each. When six of them are removed by technicians with jobs to perform, there will still be four on the shelf. Replacing the absent six would take the subscribers costs from $10K, to $16K, without any billing revenue to show for it. Shepherd’s functionality clearly tracks where these initial six are, avoiding an unnecessary over-spend and the vulnerability that brings with it.
Meanwhile, as those six are progressively used in the execution of the subscriber’s service to its customers, three are fitted under contracts where parts are included, and therefore not billed. Another is billed at half price as part of a new customer acquisition offer, and only the last two are charged at the full cost on their respective invoices.
All that pooled information can now inform the subscriber organisation when they do indeed need to restock the six parts used, they will know what those six parts cost to acquire and what they earned the company in billed revenue. With that, it becomes easier to establish if new customer deals are a good idea, or if parts-included contracts are more or less profitable than those with parts billed as they go. Not to mention, feeding into NetSuite’s Demand Planning feature with alerts designed specifically to help users ensure that they have the stock they actually need, when they need it–not more, and not less.
If your organisation spends more on parts than you would like, perhaps you should get a taste of what this degree of oversight could look like, book a Shepherd demo today.
