Why SMBs should pick Business Central for managing their production

Posted by Ute Gillet on May 22, 2024 10:55:27 AM

In the dynamic world of global businesses, the pursuit of enhancing organizational efficiency and revenue generation is unending. Companies today aspire to align themselves with buzzwords like artificial intelligence, data analytics, and the Internet of Things in their quest for better performance. However, achieving these goals often requires integrating an ERP (Enterprise Resource Planning) system.

Though not a novel concept, ERP systems gained prominence in the 1990s. Initially accessible only to larger corporations due to their excessive costs, the landscape has evolved with the advent of cloud solutions and Software as a Service (SaaS). This evolution has enabled smaller companies or SMBs to afford and benefit from ERP solutions.

Find the right ERP for productionFrom experience, we know that many companies in this sector struggle to find the ERP system that suits them. With a blog series, we aim to assist you in making this decision by introducing the manufacturing module of Microsoft Dynamics 365 Business Central. You get insights into its key concepts and functionalities as well as the missing pieces– regarding the manufacturing module – and how to overcome them by adding suitable scheduling tools to your Business Central implementation,

With this blog, I start the series and shortly outline what Business Central is and why it is a good fit for SMB manufacturing companies.

What is Business Central?

A key player in this market is Microsoft, renowned for offering an ERP solution tailored for small and medium businesses that have typically outgrown their entry-level or legacy business applications: Dynamics 365 Business Central (commonly known as Business Central or BC). This end-to-end application emerges from decades of experience inherited from its predecessor, Navision.

On their main landing page for Business Central, Microsoft emphasizes seamless team collaboration within organizations by using a single solution and they position Business Central as a highly customizable solution. The main benefits include

  • enhancing financial and business performance
  • elevating sales and customer service
  • swift migration to the cloud with confidence
  • unlocking productivity and insights, completing projects on time and within budget
  • optimizing inventory and supply chain management

While these benefits are a bit high-level, we have added a few functionalities derived from our interactions with global customers transitioning from legacy systems to Business Central:

  • cloud readiness
  • integration with other Microsoft applications
  • access to third-party extensions
  • real-time easily shareable data
  • customizable options
  • modular functionalities

Why is Business Central a good fit for Manufacturing Companies?

In our study titled “State Of Business Central and Manufacturing Report”, which was based on interviews with numerous Business Central manufacturing clients, a profile emerged, showing that the "typical Business Central manufacturing customer" is characterized by

  • less than 30 new production orders per day
  • batch sizes between hundred and thousand units
  • a production strategy triggered by customer demands (make-to-order or combined MTO and make-to-stock)

Understanding this customer profile provides insight into the specific functionalities of an ERP system that would be beneficial for manufacturing customers. Based on this report, we found out that, generally, companies move to ERP systems, such as Business Central, when they start growing. Bigger business places increasing demands on efficiency and the ability to stay on top of customer orders.

Main reasons to go for an ERP system


Our insights reveal a pressing demand for a unified solution equipped with diverse tools, addressing the dual imperative of aiding companies in scaling up and providing transparent cohesion across various facets of their operations, including administration, finance, and other critical business processes.

Main reason why customers invest in Business Central

Choosing Microsoft Dynamics as an ERP vendor is often influenced by the discontinuation of support for legacy systems. Microsoft's credibility and stability as a company plays a crucial role in this decision, as the likelihood of the company going out of business is minimal.

Business Central's positive impact on manufacturing

Business Central brings several positive functionalities to the table for manufacturing customers.

Process Improvement

  • It aids in inventory management, offering better planning based on item/component availability and demand.

  • It digitalizes warehouse monitoring, streamlining interactions with vendors and customers. Additionally, the platform's internal intelligence, found in its planning worksheet, contributes to more informed decision-making.

  • From a financial standpoint, Business Central consolidates data from accounting, purchasing, sales, inventory, and production, providing a centralized view of the financial implications on the shop floor.

  • In terms of production process management, Business Central facilitates tracking current production orders, pipeline visibility, and better understanding and management of routings, machine/work centers, and timelines associated with production orders.

While Business Central may not be a perfect ERP system – and we are not sure whether such a thing actually exists - its strength lies in the Microsoft AppSource. Functioning akin to the Apple App Store but for ERP systems, this platform allows third-party providers to fill gaps in Business Central, these gaps being inherent to Business Central or due to the complexity of the customer or of the industry they operate in. With over 3000 apps currently on Microsoft AppSource catering to specific manufacturing needs, businesses can further customize and enhance their ERP experience.

Watch out for part II of our series where we provide valuable insights into the areas where BC may fall short and offer practical guidance on how to address these shortcomings by leveraging suitable software solutions. 


More valuable information

  • Join a webinar about our powerful scheduling software for Microsoft Dynamics 365 Business Central.
  • Book a free demo with a VAPS, VPS, or VJS  specialist.
  • Get your free copy of our comprehensive eBook that covers the topics of our blog series:

Download free eBook about manufacturing in Business Central


Topics: Business Central Production Scheduling, Business Central Visual Scheduling Extensions