Standard NAV in Construction?

I got a lot of questions “Why you create vertical? Why standard NAV cannot do construction business?”…

These are very interesting questions. Especially because I am protector of standard NAV implementation with very little customization. So I’ll answer the questions carefully.

Is a standard NAV solution can handle construction business? Of course it can, but how?

First scenario:

Construction Company wants to have financial evidence for all construction projects. They work very little project activity by himself and the most of work doing subcontractors.

NAV can support the most of these activities. You have G/L Entries in NAV and G/L Budget for planning. All subcontractors work, company can post using standard Purchase Orders. If company has some own consumption, it can be posted by Item Journal. For partition on project activities, you can use Dimension “PROJECT” with Dimension Values for each project.

If company eventually has more own works, but don’t have many projects, the same scenario could be implemented. This means that the company does not want a detailed analytics by the project.

Using this scenario, company can know revenue, expense, gain, payables and receivables. If it is enough, you can use standard NAV (BE BRL license – NAV2009; Starter Pack – NAV2013).

Second scenario:

If you have the same model, but you have more projects and more own works but not too much construction position, situation is about the same. You need to use Job and Resources modules, because you need to monitor more items and more own resources (machines or persons) work per each project. All consumption of resources and items you will post using Job Journal. You can eventually use tasks for construction position. If you have subcontractors, you will post that using Purchase Order, but with Job code.

You will have all analysis as in first scenario, but you will have more advanced analysis using own resources statistic using Job Ledger Entry. Also, you will can to make Sales Invoice per jobs, but no as construction certificate. If it is enough, you can use standard NAV (AM BRL license – NAV2009; Extended Pack – NAV2013). But if you want to make calculation of contracting position, you will can this, but using MS Excel :).

Third scenario:

You have many complex projects. You have hundreds or even thousands construction positions per project. You make contract for projects and many annex and claims. You want to make calculation for each construction position or for the position group. You want to use your experience from old projects on own norms. You want to monitor each part of projects… You want automatically made construction documentation and automatic construction certificate/invoice…

Then, you cannot use standard NAV for your business. You have two choice:

  • Add vertical solution to NAV (I recommend NAV4Construction 🙂) with all functionality you need
  • Buy some specific construction software and make integration with NAV; I think this is bad solution, because you will not get all ERP functionality (many data you will not have) and the same experience.

We can make more scenarios, but if someone has some question, then ask me.

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