I did a few searches (both on Google and Fatwallet) and have not found any good suggestions. (this thread on Microsoft Money was the closest thread I found... and it's not very close)
My company is an online retailer via Amazon, Half, our own website and a dozen other "marketplace" type accounts. Our annual revenue is around $25M and we operate warehouses in 5 states.
Our inventory (and payments for our inventory) varies by supplier - in some cases we purchase by weight. In other cases we have profit-share agreements with another company's inventory.
Our income generally comes via check or ACH for domestic marketplaces. We also sell in several foreign marketplaces (e.g., Amazon.fr) and our banks handle transferring the funds to our US accounts.
Payroll for ~250 warehouse employees is handled via ADP.
When we started out as a single warehouse, we used QuickBooks Pro. Later, as we expanded to 3 warehouses, we upgraded to QuickBooks Enterprise Solutions with 5 CALs. (since we have up to 5 accounting staff concurrently accessing our financial software).
With our most recent 2 warehouses, we decided to open them as subsidiary companies - so in QuickBooks , the accounting department is constantly logging out and back in to switch which company they are working on. Our "company file" (QuickBooks .QBW database (flatfile?) is hosted on a virtual machine (Virtual Server 2005) on a 4 socket 3.66GHz Xeon/32GB RAM / shared server, but it is very much underutilized. Still, performance is starting to become a bottleneck.
The feature set for QuickBooks Enterprise Solutions is adequate but performance is not (specifically, doing day-to-day operations such as entering credits/debits as well as opening/closing the company file is sluggish and hampering both the productivity and morale of the accounting staff). I see that there is a third party ODBC driver available for reading data from the QuickBooks data file (qbodbc) - but this seems to be read-only. (so we couldn't, for example, "upgrade" the backend for our QuickBooks database to SQL 2008 Enterprise and add a partitioning function or extra drives in a RAID 10 array to attempt to improve performance).
We are discussing the possibility of setting up some trial installations of competing software. SAP is out of our price range at this time. Peachtree is a possibility. A colleague suggested Microsoft Dynamics.
There are a lot of very experienced and intelligent posters here at Fatwallet. Does anyone have experience in a similar situation? What would you recommend? Could you offer a ballpark estimate for the software (licensing & 1099 developer support for integration) if you happen to have this level of experience?
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calebb said:With our most recent 2 warehouses, we decided to open them as subsidiary companies - so in QuickBooks , the accounting department is constantly logging out and back in to switch which company they are working on. Our "company file" (QuickBooks .QBW database (flatfile?) is hosted on a virtual machine (Virtual Server 2005) on a 4 socket 3.66GHz Xeon/32GB RAM / shared server, but it is very much underutilized. Still, performance is starting to become a bottleneck.Wow!
You know, with the proper accounting software, you can keep track of multiple subsidiaries with one accounting package. I've seen companies that track 5-10 subsidiaries and as many different physical locations using the account numbers. The right accounting package should let you do this without having to switch 'company files'. IE: the utilities account would be something like account 31554-05-12. the -05- denotes a specific subsidiary and the -12 denotes the physical location.
Your QuickBooks file is probably getting really slow because it is huge with all of your company history. I've seen 250 megabyte QuickBooks files and I'd imagine your is even bigger.
25 million of revenue is pretty big to still be using QuickBooks . If you have bank loans, it is likely that you are required by your bank to have audited financial statements. An auditor would have a good understanding of your business and industry. What does your auditor suggest when you discuss this with them? Also, you are probably at the point where you need to hire a competent controller and / or CFO. They should have an understanding of accounting systems and their preferences. It is important to get a product that your staff can understand, set up correctly, and use.
I am also a seller on the sites you mentioned (but only a 100th of your size), but additionally I am studying accounting (MST & CPA) and I completely agree with theman2's suggestion of hiring a controller / CFO, with that revenue you would be able to recruit some good talent from one of the Big 4 firms, someone whose been working for 5-6 years there will have experience with clients of your size and it would surprise me if they haven't seen the very solutions you need alright executed with other companies (although it occurs to me you could just contact a Big 4 accounting firm on a consulting basis as well). All the best to you and your employer, a good combination of Thriftiness and a well executed business plan is gold on Amazon.
I think based on their size that you are right on on the margin being small. In this case I imagine they have streamlined the picking and shipping process, and sell products that fall within a certain shipping category to offset the low prices of their products (but make a decent amount on the shipping credit given by each marketplace)...I did a simple analysis when I started selling a few years back and thought it would make for a perfectly fine idea if you had the right software and the right resources (mainly a large initial financial backer). Personally I went a different way and decided to go with quality inventory and a lower turnover rate but high profit margins over a large quantity of inventory for large volumes sales, but each gets the same result, good profits.
Message edited by: insanehero on 2009-11-04 10:34:46 CST
insanehero said:I'm sorry I can't help it. One problem I came up with when I was first starting (and considering which of the above two strategies to attempt) was what to do with the crap inventory if I went with quantity over quality. I figured if I was buying in bulk then at least 30% (if not way more) would be unlistable. I suppose it could be trashed/recycled but that just adds another cost, donating them would be nearly impossible (what you can't sell you can't give away in america), although one could go the BWB route and ship them to africa...anyway I realize I talked way to much in this thread, give me the word and i'll delete all of this crap calebb
No, it's cool insanehero - your posts are very much appreciated.
Gandhis - we have not looked into Netsuite but we will now. Thanks for the tip.
theMan - the "proper accounting software" sounds much better than what we have now. We have not discussed this with our auditor. (I'm not sure why - I'll definitely give props to "TheMan" for the suggestion when I propose this conversation to our controller... of course, she'll be wondering what The Man has to do with it, but I'll keep that between you and me). Also, I had not considered archiving data from the QuickBooks file. You're right - there is 5+ years of financial data in there. I'll investigate what options there are for archiving the data and what steps are necessary to retrieve this data when needed.
tripleB - as theMan mentioned, we try to keep it thrifty But I can't discuss our profit margins here. One good thing about selling used items is the market is more recession-proof than, say, new electronics.
Thanks again for all the suggestions so far!
Message edited by: calebb on 2009-11-04 11:30:27 CST
calebb said:insanehero said:I'm sorry I can't help it. One problem I came up with when I was first starting (and considering which of the above two strategies to attempt) was what to do with the crap inventory if I went with quantity over quality. I figured if I was buying in bulk then at least 30% (if not way more) would be unlistable. I suppose it could be trashed/recycled but that just adds another cost, donating them would be nearly impossible (what you can't sell you can't give away in america), although one could go the BWB route and ship them to africa...anyway I realize I talked way to much in this thread, give me the word and i'll delete all of this crap calebb
No, it's cool insanehero - your posts are very much appreciated. (lol @ the betterworld comment)
Gandhis - we have not looked into Netsuite but we will now. Thanks for the tip.
theMan - the "proper accounting software" sounds much better than what we have now. We have not discussed this with our auditor. (I'm not sure why - I'll definitely give props to "TheMan" for the suggestion when I propose this conversation to our controller... of course, she'll be wondering what The Man has to do with it, but I'll keep that between you and me). Also, I had not considered archiving data from the QuickBooks file. You're right - there is 5+ years of financial data in there. I'll investigate what options there are for archiving the data and what steps are necessary to retrieve this data when needed.
tripleB - as theMan mentioned, we try to keep it thrifty But I can't discuss our profit margins here. One good thing about selling used items is the market is more recession-proof than, say, new electronics.
Thanks again for all the suggestions so far!lol, don't give me any credit when you talk to your controler or auditor. Just tell them that you are starting to think that your business is outgrowing your current software solution and you are looking for suggestions to evaluate.
If you need/want to try to keep QuickBooks for a while, there is a way to get it to consolidate old transactions into summary form that will significantly reduce the file size. The way to do it is to first do a full backup of your QuickBooks to maintain a complete copy of your old records and then run the QuickBooks tool and get it to consolidate the older information. You probably only need 1 to 2 years of detailed information readily available.
scottxmso said:tripleB said:On a revenue of $25M whats your profit margin? My understanding of ecommerce is that there's a huge trade off of margin for turnover.
Hypothetically, in a hypothetical theoretical situation.Hypothetically, you can reduce your prices to increase your revenue which will lower gross margin.
You can't start by looking at a company's revenue and arbitrarily determine their gross margin based upon just that factor.
If your only worry is that the database is getting slower to run, but you're happy with QuickBooks , consider Intuit's hosted solution, Online QuickBooks . They take care of the server and the backend, and you get logins for your officers and accountants.
Downside- you have to trust Intuit with your data. You need an internet connection to access the site. The cost is $35 a month +a fixed cost per login. (easier to account for and deduct than software and a server, though.)
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But I can't discuss our profit margins here. One good thing about selling used items is the market is more recession-proof than, say, new electronics.
