Technology makes tracking of stock easier for Crown Paints
Crown Paints CEO Rakesh Rao during the opening of the new Crown Paints Offices in Mombasa. PHOTO | KEVIN ODIT
Kenyan manufacturers are investing millions of shillings in technology, taking cue from banks, insurance firms and telecoms as they seek to boost efficiency and cut costs.
Crown Paints is among manufacturers that are betting big on technology to seal financial loopholes and track the movement in stock.
The chief executive officer Rakesh Rao said the adoption of ICT across its systems has boosted efficiency in the company and cut financial and material leakages.
Communicating with staff spread across the region as the company widens its reach is importance, said Mr Rao.
Crown Paints has shifted to online calls between the top management and heads of departments, making savings on phone expenses.
“We have given tablets to all our sales people, whereby they now do not prepare any physical daily reports. Once they log into the system we are able to track their sales and also see where they are,” said Mr Rao.
“We have spent more than $4 million (Sh370 million) in these systems and all our locations are online. For instance, I do not need to wait for the Kisumu or Mombasa depot to file reports on what they sold, I just look it up online,” he said.
The paints maker is also using technology to track the stock movement history and put financial control to ensure that field managers and distributors do not request for goods that they have no capacity to sell.
Keeping track of movement of goods not just from the factory, but also further down the chain at distributorship level allows managers to make quicker decisions on production rates and therefore optimise their resources, avoiding manufacture of idle stock.
Many distributors rely on access of goods on credit from manufacturers, meaning that idle stock makes it harder to balance books. Auditors also have an easier time checking the flows of cash and goods with the computerised records.
Many manufacturers require that any changes to keyed-in orders be authorised by management, even in cases where the change is arising out of an error that needs to be rectified.
“For instance, where we have distributors hitting the limit of goods they normally take, the system locks them from taking more stock, and if they need more stock, approval has to come from directors. Earlier, there was no such control, and some people would take much more than their capacity, and have problems paying later,” said Mr Rao.
To ease the payments process, distributors and manufacturers are adopting mobile money payments, especially those who move smaller amounts of goods.
Many Kenyan manufacturers have adopted ICT in logistics departments, preventing cases of diversion of goods by unscrupulous transporters. Tracking software in fleet management are helping companies to keep track of vehicles at any one time.
Mr Rao said his company has also computerised processes such as paint selection which previously would be done manually, making it easier for customers to choose.
“We have installed visualisers on a screen where customers can walk into our showrooms, play with different colours and select the right one for their rooms. The computer generates the colours, and once we feed in the shade code, it is fed into the system and then it will be manufactured,” he said.
Through technology, he said, a customer is now guaranteed to get the exact colour they want, in a process that can last for just a few minutes.
Automation helps a company save on labour costs, given that computers do the work that would have normally been done by several people in a manual process.
As more manufacturers seek to cut costs with adoption of technology, it exposes the sector to cybercrime risks.
Financial institutions in particular have been victims of IT-related fraud that has seen millions transferred from customer accounts, with some of these crimes being instigated by employees.
Manufacturing firms face the risk of manipulation of stock or payments by tech-savvy managers or distributors, leading to losses.
However, with checks against potential weak spots in the system, such loopholes can be sealed.
