What is ERP for small business?
ERP simply refers to computer-based software that helps you conduct your business more efficiently. It integrates all the key processes of a business in one place; hence making your job much easier. These processes include
- Human resource
- Human resources management
- Logistics and store management among many others.
ERP also includes other types like enterprise resource planning (ERP), enterprise resource planning software (ERP software), and third-party software.
Small business owners are always looking out for cost-effective ways of conducting their businesses. They want to cut operating costs to increase profits. In such a scenario, they often try to use any cheap and available software system, even if it may not be the best ERP system.
It is a good idea to use a cheap and available ERP software system. But over the years, these cheap software systems proved to be really ineffective for some small businesses. Here are some of the reasons why small businesses often fail to implement or use the best ERP for small businesses often.
It is difficult to upgrade technical support systems for on-premise or software. You have to contact your ERP vendor on a regular basis to get the upgraded technical support. If your ERP system is purchased from third-party vendors, it becomes very difficult to upgrade or add on any additional functionalities to the ERP software, especially when it is an expensive one.
Many ERP vendors charge a very high amount to provide any additional functionality or security features to the ERP software.
Implementation of an ERP system requires large upfront capital. Even though many on-premise ERP vendors provide free upgrades to their ERP products, the upgrade can be quite expensive and time-consuming. You may find your company unable to sustain the implementation cost if you make large-scale deployment of ERP in your organization.
Many on-premise ERP vendors also charge a very high license fee for each user in the organization. Enterprise software is quite expensive and the license fee can easily run into thousands of dollars per year. learn more about the functions of ERP at http://www.tactiphone.com/what-is-an-erp-and-what-are-its-functions/
Poor Inventory Management
Small businesses face several problems such as poor inventory management, defective product delivery, poor order management systems, etc. The system to track inventory is the most important ERP system. Inventory tracking helps in improving the operations such as ordering, stock, product quality, and customer service.
Inventory tracking can improve order processing and customer services. On the other hand, defective product delivery can lead to heavy losses to the revenue of the company. Click here to learn more about inventory tracking.
Payroll is another important component of every small business inventory management system. A payroll system is an important part of any ERP and the success of ERP depends upon its ability to seamlessly integrate with payroll processes.
Enterprise resource planning software handles payroll data across different locations and provides benefits such as no travel, easy access of data across the organization and multiple users, improved accuracy, and reduction in data costs.
Lack of Organizational Structure
Another common problem faced by small businesses is the lack of organizational structure and time wastage in various activities. This is one of the major reasons behind failed ventures. Small ERP software can help solve these problems.
The ERP solutions integrate all the processes of the company and help in increasing the efficiency of the organization. ERP helps in improving order processing, eliminating errors, reducing the cost of production, improving the quality of products, and getting new processes set up.
The ERP solutions can be used for finance, human resource, operations, and inventory management among other processes.
ERP software solutions for small businesses
Today there are numerous vendors offering ERP software solutions for small businesses. Before selecting the right ERP for your organization, you should estimate the present structure of your business and identify the processes that require automation.
If you have a large enterprise, then the selection of ERP software becomes even more important. Since there are various choices available in the market, it is advisable to evaluate the functionality of each software and then make your selection or hire an ERP professional like Connected IT Consulting.
Before installing an ERP solution, it is important to conduct a thorough analysis of your business processes and then decide on the type of help that suits the organization the best.