Manufacturing ERP

Most small and mid-sized factories price their products from a cost estimate made a year ago. Then raw material prices move and the price does not, and the margin erodes quietly until it shows up in the year-end result.

A manufacturing ERP is a system that links the bill of materials to the production order to stock to accounting, so the cost of a produced unit comes out as an actual number rather than an estimate. Fahim delivers this system over WhatsApp: the line supervisor records what was produced by message, and the owner asks about cost and margin from a phone. It suits small and mid-sized factories in Saudi Arabia, from a single-line production workshop to a plant with several lines and warehouses, that want pricing built on today's cost rather than last year's.

From raw material to finished goods

• Bill of materials per product: what goes into it and in what quantities.
• Production orders — issued to reserve raw material, deduct it on execution, and add finished goods to stock.
• Unit cost — actual material plus labour plus overhead allocation, moving with purchase prices rather than an old estimate.
• Waste — the gap between theoretical and actual consumption, measured per production order.
• Three stock levels — raw, work in progress and finished, each with its balance and cost.
• Reorder points on raw material, so a line does not stop for an input that ran out without warning.

What Fahim adds

Capture from the shop floor over WhatsApp: a line supervisor sends “production order 500 units of item X — done”, or a photo of the works order, and it is recorded. The supervisor is not asked to become a system user.

And you ask: “what is unit cost this month?”, “which raw materials are running low?” — answered with a current number.

If you have an existing system you do not want to replace, Fahim integrates with it through the API and runs as an operations and invoicing layer on top.

Who this system is for

• A food or packaging factory buying raw material at changing prices and producing in volume, where the margin is sensitive to input cost.
• A metal or wood fabrication workshop producing to order and needing the cost of each job separately.
• A plastics or chemicals plant where waste is measured by the kilo and a small difference in consumption changes the profit.
• A factory with several warehouses that wants raw and finished balances per location with no manual reconciliation.

A factory that needs detailed capacity planning and complex machine scheduling is assessed before contracting, and integrating with its existing system may suit it better than replacing it.

Example: how unit cost moves

For example: a product uses 2 kg of a raw material priced at SAR 9 per kilo, with labour and overhead of SAR 6 per unit. Cost is SAR 24, and selling at SAR 32 leaves a margin of SAR 8. The raw material rises to SAR 11, so cost becomes SAR 28 and the margin SAR 4 — half of what it was. In a system that updates raw material cost from the supplier invoice, this difference appears with the first production order after the purchase. In an annual estimate it only appears months later.

Then add waste: if a 500-unit production order consumes 1,060 kg instead of the theoretical 1,000 kg, waste is 6% and is charged to that order, so you know which line or shift wastes more.

A working day in the factory

• Morning: the warehouse supervisor sends a photo of the invoice for the raw material received. Quantity and cost are updated, and unit cost moves with them.
• Start of shift: the production manager sends “open a production order for 500 units of item A”. The required raw material is reserved from the bill of materials.
• End of shift: the line supervisor sends “order done, actual consumption 1,060 kg”. Raw material is deducted, finished goods are added, and waste is calculated.
• Afternoon: the sales rep asks “how much of item A do we have ready to sell?” and receives the finished goods balance.
• Evening: Moeen sends the day's summary: what was produced, the unit cost, and the raw materials approaching their reorder point.

How it works, step by step

1. Define products and bills of materials: each product with its components and theoretical quantities.
2. Update raw material cost: every supplier invoice updates the item's cost automatically.
3. The production order: opened by message, reserving raw material and tracking execution.
4. Closing: on completion, actual consumption is deducted, finished goods are added, and waste and cost are calculated.
5. Sales and reports: finished goods are sold from stock, so each product's profitability appears at its true cost.

What regulation requires and how it is covered

Factory sales fall under e-invoicing per the Zakat, Tax and Customs Authority (ZATCA): Phase 1 has been mandatory since 4 December 2021, and Phase 2 (integration) has applied in waves since 1 January 2023. Every sales invoice leaves the system with 15% VAT and reaches the tax return with no second entry, and input VAT on raw material is recorded from the supplier invoice itself. Wages for production workers fall under the Wage Protection System through the Mudad platform, so the upload file is built from the approved payroll run.

Compared with spreadsheets and traditional systems

• Spreadsheets: unit cost is calculated when someone updates the file, usually with an old raw material price.
• General accounting software: knows the value of purchases and sales but not what went into each unit produced.
• A traditional manufacturing system: accurate in calculation but needs a data-entry clerk in the office, so the number lags the line by days.
• A system that runs from WhatsApp: capture from the line at the moment of the event, and the number is requested with a question.

What Moeen adds

Moeen is the personal assistant included in the Moeen and Fahim plans. It sends a morning summary of open production orders and raw material balances, alerts you when a material approaches its reorder point or waste on an order exceeds the usual, and prepares a customer quote based on today's cost for you to review before sending. It asks your permission before any action.

Permissions come in 5 roles: general manager, sales manager, accountant, warehouse supervisor and employee. So the line supervisor records production but does not see purchase prices, and the sales rep sees finished stock but not its cost. Alongside Moeen, 4 AI agents work on sales, finance, purchasing and market.

Plans and trial

The Essential plan at SAR 75 per user per month gives you the full system from the browser. The Moeen plan at SAR 375 adds WhatsApp and the personal assistant. The Fahim plan at SAR 935 adds AI that modifies the system on request: you ask by message for a batch-number field on the production order or a waste report by shift, and it is applied within minutes. Larger factories have the Enterprise plan on request. Prices exclude 15% VAT, the first month is free, and with the Golden Guarantee you get a full refund within 30 days. Details are on the pricing page.

Implementation plan

1. Setup: define items, bills of materials and opening stock balances at all three levels.
2. One pilot line: production orders are opened on a single line from WhatsApp until the supervisors are used to it.
3. Roll-out: the remaining lines and warehouses, and linking suppliers and sales.
4. Monthly review: unit cost and waste per product in one report that everyone sees with the same numbers.

The free month is usually enough for the first two steps, so you decide having seen the cost of a real product.

Read next

• Warehouse operations
• Reorder point and safety stock
• Dead and slow-moving stock