Construction Specialties Australia is the local arm of the Construction Specialties group of companies -- a specialist manufacturer and distributor of commercial architectural products, with 22 offices worldwide.  Like other suppliers to the building and construction industry, delivering customised projects to strict deadlines is critical to business success.  With SYSPRO, Construction Specialties Australia has achieved a competitive edge and is now further expanding in the local market.

The Australian business commenced operations in 1983, using several smaller accounting packages before migrating to SYSPRO (then known as Impact Award) in 1994 and its suite of financial, manufacturing and distribution modules.

The Australian office has built its business in supplying specialist interior wall protection products.  The company manufactures and supplies “Acrovyn®” -- a system designed to protect interior surfaces particularly in hospitals where surfaces can be damaged by trolley and wheeled-beds, as well as in hotels and office interiors. 

Peter Watters, general manager for Construction Specialties Australia explains how every project is managed as a customised, one-off job.

“This is a project-based business where every job is individually specified.  A typical project can involve 40 or 50 separate components which are used to manufacture the wall protection coverings and make crash rails and bumper guards.

“Each component is selected from a range of possibly 60 colours and multiple profiles of perhaps four to five shapes.  Installation can require two or three progressive deliveries to complete the project,” he said, noting that the value of the project could range from several hundred to several hundred thousand (Australian) dollars.

“As there are potentially thousands of items of inventory, we can only keep neutral colours – so we must often order stock,” he said.

With only minimal available inventory but a deadline-driven project requiring multiple items, Watters explains the importance of SYSPRO’s ‘Quotations & Estimating’ (Q&E) and ‘Landed Cost Tracking’ (LCT) modules when the company wins an order.

“On receiving an order, SYSPRO’s “Quotations & Estimating’ is used to automatically create a back order and bill of materials to show what inventory exists and what needs to be ordered.  This instantly flows through to creating purchase orders to obtain additional supplies from the US or Asia for the components we don’t have.

“The LCT module gives Construction Specialties accurate ability to tell when it’s going to arrive.  This is vital, especially when managing long lead times.

“The system is great because at any one time, you can manage a multitude of orders with each order comprising many colours and shapes.  For example, the US may only be able to partly fulfil an order and will ship it out in several deliveries.”

“LCT can combine different purchase orders into one shipment – and if there is one date change – then this can be automatically altered and all orders can be simultaneously adjusted,” he said noting, “SYSPRO handles this well”.

Watters explains how the system allows the company to gain extra lead time resulting in a more competitive edge.  “Our products are primarily custom profiled aluminium and vinyl-acrylic extrusions, with injection moulded components and sometime specialised paint or anodised finishes.  While some of this can be manufactured locally, economies of scale dictate that investment in local tooling is not warranted.  We must therefore import many components and assemblies,” he said. 

“Thus lead time is very important.  A key differentiator between competitors in the building industry is the ability to meet deadlines.  Suppliers and contractors must meet the delivery date or face massive liquidation damages,” he explains, noting that installing wall protection is one of the final stages of completion before a building can be handed over. 

SYSPRO provides the company with the ability to meet delivery dates and keep a close watch on a project’s progress.

The modules’ flexibility in handling complex invoicing has been just as important in ensuring profit margins.

SYSPRO is accurate in itemising each stage – from purchasing, to inventory stocking to cutting and assembling the job – which is finally delivered in kit form.  The ‘Work in Progress’ module also allows labour transactions to be captured against each stage which incorporates cutting and assembling a multitude of metal and plastic components, he said.

“With SYSPRO you can ‘bend the rules’ of the Work In Progress (WIP) and Sales Orders modules to meet your business.  For example, even if an item is not in stock, you can still set up a job, and this in turn allows progress deliveries.  The software is very flexible in this regard, enabling us to work the way our business requires - yet still maintaining good internal controls.”

The company is able to raise an invoice even before starting actual work -- a particularly important feature in the construction industry where a deposit is required to start, along with the ability to invoice progress payments.

Construction Specialties Australia originally commenced as a licensee in Australia in 1980 and was acquired by the US-based Construction Specialties group in 2000.  SYSPRO has proved useful in meeting requirements set by corporate headquarters.

Watters notes, “In October 2000, Construction Specialties Australia had to change its accounting year to match the US financial year which at that time ended on 30 April.  Although this required changing the entire general ledger, the transition went smoothly as SYSPRO has built-in features to handle such a change.

“Following this adjustment, the company was required to change its system again – this time to a calendar year.  Again this was a massive change that went smoothly.”

Construction Specialties moved from Standard costing to FIFO (First In, First Out) costing in 2005 which has allowed for more accurate inventory costing.  The system is able to account for freight, duty and excises, he said, adding - “The auditors have been much happier with this system.”

“SYSPRO’s custom forms also have been useful in meeting other head office demands,” he noted.  For example, among the regular reports needed, the US parent company requires a ‘delivery performance’ report showing the percentage of shipments delivered on time.

“The Report Writer allows us to compare data from the WIP module with the invoiced date from the Sales Order module to create a report showing discrepancies between delivery date and the promised date, plus reasons for discrepancies can be shown in an additional custom field.”

SYSPRO has contributed to improving the company’s own internal business procedures because of the need to meet in-built rules and processes, Watters noted.

SYSPRO’s flexible solutions have prompted other Construction Specialties companies in the Asia region to consider this ERP system.

“Singapore chose to implement SYSPRO after comparing SYSPRO in our Australian office with BPCS which is used in the US offices,” Watters notes.  A future plan being considered for Construction Specialties in Asia is allowing sales representatives in Hong Kong and Thailand to make inventory enquiries via web browsers to view stock which is manufactured in Malaysia. 

Construction Specialties’ – Australia success is leading to another phase of growth.  Previously focused on interior building projects, the company is now expanding into supplying products for commercial exteriors. 

The company has won its first contract to supply the Australian National University in Canberra with Construction Specialties Sun Controls  - architecturally designed exterior aluminium shading systems that keep building interiors cool and thereby reduce electricity consumption.   This new exterior projects market promises to be exciting; exteriors tend to be ‘big ticket’ jobs in comparison to interiors, notes Watters.  He now envisages possible use of the ‘Engineering Change Control’ module, as the company further expands into this market segment.

“SYSPRO has been constantly updated and has grown with us.  As we’ve had new requirements, we’ve often found that SYSPRO has that feature already available.   As the nature of the company changes, it has been able to implement different parts of SYSPRO,” he said. 

From starting business with just three staff over 25 years ago, Construction Specialties Australia has grown steadily and is now regarded as a leading supplier in commercial building projects.   With its growth, it use of SYSPRO has expanded, and this promises to continue with Construction Specialties’ Australia continued success.