Ontario firm works wonders with water … and its own fortunes

Unlike the alchemists of medieval times, Steve Hengsperger didn’t aspire to change base metals into gold.

But what he sought, and accomplished, was no less amazing – the transformation of ordinary cold tap water into a powerful sanitizing agent that destroys microbes and toxins, and even neutralizes pesticides.

Hengsperger is founder and CEO of Tersano Inc., the Oldcastle, Ont-based firm whose Lotus sanitizing system is making waves — and winning new customers across North America, and in Barbados.

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This natural sanitizer was named Best Invention of 2006 by TIME Magazine.

Today, Tersano’s super-oxygenated water is being used – not just to safely clean food – but also by casinos and hotels to sanitize furniture and bathrooms.

And no less remarkable than the transformation of ordinary water, is the metamorphosis experienced by Tersano itself.

The firm, which three years ago was a small startup, today does business worth millions of dollars and has a customer base that extends across Canada and the U.S.  

Tersano owes much of its success to its unique “water transformation” technology dubbed the Lotus Sanitizing System

But while this system has kept the orders pouring in, the firm also had to ensure it is able to fulfill these orders … promptly and completely.

To do this Tersano relies on enterprise software from SAP Canada Inc.

Benefits of automation

Despite its multinational operations — and a customer list that includes names such as Costco, Home Depot, Linens & Things and Neiman Marcus — Tersano gets it all done with a tight crew of 10 employees!

This feat, company execs say, has a lot to do with the rollout of SAP Business All-In-One, a business software suite targeted at small and mid-sized firms.

Coordinating inventory and supply would be a huge challenge without this system, according Debbie Harmer, Tersano’s manager of sales and operations.

She said the SAP Business All-In-One  suite automated this process, and in doing so speeded up shipping by as much as 66 per cent.

The suite’s finance and sales applications eased the load on office personnel and the firm’s lone accountant and increased workplace productivity by about 33 per cent.

Tersano’s online shopping cart also serves as a new revenue channel that now adds at least 25 per cent to sales volumes, according to Harmer.

Key challenges

She said when Tersano opened for business, a key challenge was finding a pre-configured ERP software package that met all the firm’s needs.

This had to be accomplished prior to initial product development. Before everything started rolling out at the factory, located in China, to the third-party warehouse in Canada, Tersano needed to have an inventory system in place.

This system had to support manufacturing, the entire sales-to-cash process, the online shopping cart, electronic warehouse integration, and third-party tax programs.

Moreover, as Tersano’s workforce is small, the company wanted a  single system to manage sales as well as product development.

“Our people need to data across various aspects of the businesses to make fast and informed decisions that save time and money,” Harmer said.

For instance, if a sales person receives an order, he or she needs immediate confirmation that inventory is available from the warehouse and delivery can be made within a specified time period.

How the ERP helps

Tersano does not maintain its own warehouse and just-in-time inventory and delivery is vital to maximize the rented space and cut cost, Harmer explained.

“We keep a tight shipping schedule. To [dispose of] inventory within 24 hours of receiving shipment, we deliver three times a day, at 10 am, 1 pm and 3 pm,” she said.

To coordinate this manually would be chaotic, she said. Without an automated system informing personnel about incoming online orders, phoned-in requests and scheduled deliveries, some orders might be dropped, delayed or repeated.

“With SAP ERP, our employees are able to instantly receive reports on what orders have been closed and those still pending.”

Manufacturing costs have, so far, been lowered by as much as 40 per cent, while inventory accuracy is nearly 99 per cent, Harmer said.

The system helps sort out transaction problems for Tersano’s accountant who comes in two to three days a week.

For example, if an order is held back by the system, the accountant can easily drill down to the accounts receivable and accounts payable level to find out why.

“Our accountant can even go to the credit card level to find out why the order didn’t post.”

The system also speeds up transactions with businesses in Barbados.

Tersano’s Ontario office takes care of accounts receivable for Barbados orders but payments are handled by the Barbados facility.

Sending invoices from Ontario to Barbados via courier could take as many as three days. SAP ERP links the two offices so data can be shared or sent between locations in a matter of seconds.

The third party taxation feature of the system becomes very handy when dealing with international and regional jurisdictions, Harmer said.

“Some sales tax programs can cost as much as $60,000. But we are able to save money because SAP ERP can integrate to with hosted service providers outside the system that charge only $100 a month,” she said.

Quick turn around

Harmer said the SAP suite enables  services to be developed with the least amount of work. “Services within the systems can be configured for our business needs and personnel training provided within a matter of days.”

Small and medium sized business, need enterprise software systems that provide quick value turn around, says Conrad Mandala, vice-preisdent, SME (small and medium sized enterprise), SAP Canada.

He noted that 70 per cent of SAP’s customers are small and midsized enterprises.

“The common theme I hear from SME operators is they need fast time-to-value. They are often short on resources and cannot wait for the ERP system start delivering value for the investment.”  

Rather than develop time consuming custom ERP software products for clients, SAP includes built-in service templates within its All-in-One product, he said.

There’s no need to build a new application from scratch each time a business need arises, Mandala said. “The templates our systems have are 50 to 70 per cent complete. They incorporate features we’ve found to be needed by businesses over the years can easily be tweaked and configured.”

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