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ERP software's flipside: helping users downsize: most service centers have invested in new computer hardware and software to help their companies grow. Today, those same systems are proving invaluable as companies are forced to get smaller.

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SERVICE CENTERS ARE REPORTING anywhere from 20 to 60 percent declines in sales, say software executives, who admit that times are challenging for them as well. But, they add, more progressive metals distributors are taking advantage of the lull in activity to fine-tune their business systems so they can take full advantage of the rebound that will eventually come.

Service centers normally invest in information technology when the market is good, but pull back when the market is weak, observes John Bilek, president of Enmark Systems Inc., Ann Arbor, Mich., which markets the Eniteo system. "We should be selling systems in an up, down or sideways market because we create efficiencies and reduce costs at any time. The truth is, when the economy goes down, many service centers stop buying."

"It runs the gamut from companies doing nothing to others that are taking the initiative to implement in the downturn, which is the opportunistic way to do it" says Ron Greco, director of sales for AXIS Computer Systems Inc., Marlborough, Mass., which sells AXIOM software.

"You can't afford to do an implementation of software when you are real busy, but now that key people have some available time, this is when you should prepare for the upswing" says Alan Goniwich, president of Verticent, Tampa, Fla. "We're seeing some new energy from customers who are proceeding with implementations."

The latest generation of enterprise resource planning software is just as valuable in helping service centers shrink their costs during recessionary times as it is in helping companies grow their business during boom times, say software executives. Three main areas where software is helping service centers economize: manpower, inventory control and accounts receivable.

Most software providers hesitate to trade on the concept, but the main driver behind automation is to reduce headcount. Computer systems help service centers sell and process more orders with less manpower. Software providers say they prefer to think of it in terms of expanding the user's workforce, along with the company's overall business.

"From a manpower standpoint, we don't sell on reducing headcount, but obviously you can...

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