10 things you need to know about ERP software 

Many UK businesses use enterprise resource planning (ERP) software. It can help you to streamline your operations, reduce your costs, boost your productivity and grow your business more effectively. 

Whether you are managing stock, orders, customer relationships, cash flow or people, ERP software brings together your core business functions in one place, allowing you to make the most of your resources, maximise your efficiency and profits.

By offering real-time access to critical data, ERP software enables you to make business decisions based on real-time information. It can also bring a host of other benefits. If you are considering introducing ERP software into your business, here are 10 things you should know.  

1 ERP software can give you greater control

ERP software centralises management of key operations, such as finance, stock, sales and marketing, HR, payroll, procurement, customer relationship management (CRM) and project management. Using ERP software can bring it all together in one place, so that you can work smarter, reduce your costs and save time and money when running and growing your business. 

2 ERP software can bring a wealth of benefits

ERP software helps businesses to remain well organised, more efficient and better-informed. Its automation can deliver significant time and cost savings. ERP software allows people in different parts of a business to share the same critical data. SME owners and managers can also use ERP software to make smarter business decisions based on accurate, real-time data. ERP software can enable better customer service, for example, by better tracking orders, managing customer relationships and personalising communication with customers, etc, which can boost sales.

3 ERP software can benefit businesses great and small

The benefits of ERP software are not just available to large enterprises, SMEs can also gain. While the big fish rely on ERP software to manage the complexity of operating on a large scale, all businesses need to streamline their processes, minimise their costs and maximise their productivity. Although larger organisations require highly customised, on-premises ERP solutions, for a far lower investment, smaller businesses can gain from more flexible, cloud-based ERP software. 

4 Not using ERP software could be a big mistake

Without ERP software, many small businesses need to rely on separate software or even simple computer spreadsheets. This can lead to duplicated effort, errors and missed opportunities, because information is not shared. Using ERP software brings everything together in one place, saving time, improving accuracy and helping businesses make better-informed decisions. Not using ERP software leaves businesses stuck with fragmented systems, siloed data, manual processing and poor visibility, which can lead to inefficiencies, higher costs, lower productivity and no growth.

5 Compliance can be more challenging without ERP software

Regulatory compliance can be much more challenging when you need to manage critical information across several platforms. Businesses must rely on fragmented systems, manual processes and inconsistent data, which increases risk of mistakes, missed deadlines and regulatory transgressions. Not having data stored in one safe central location can create additional data security risks. 

6 ERP software can boost your productivity and profits

Using ERP software to share information efficiently across a business prevents duplicated effort, while allowing your team to work better together towards the same objectives. It could also free up their time. So, for example, a business could use ERP software to integrate its website with inventory and accounting records. When a customer buys something, the ERP system automatically updates stock levels, generates an invoice and actions shipping, leaving staff to focus on customer service and selling.

7 ERP software features a wide variety of modules

ERP software modules are parts of an ERP software system that take care of specific business functions, such as inventory, CRM, finance, HR, etc. Each module integrates with others to streamline operations and centralise data. So, for example, when a customer buys something and the sales module processes their order, the finance module automatically records the sale as revenue in the business’s financial records, while, if stock is low, it triggers a purchase order in the ERP procurement module.

8 ERP software is used in different ways in different sectors 

• Manufacturing – A small UK manufacturer could use ERP software to schedule production runs, track materials and help ensure compliance with safety standards. ERP software could also play a key role in reducing downtime and defective products. 

• Retail – A small fashion retailer could use ERP software to synchronise online and in-store sales, manage seasonal stock and predict seasonal buying trends, helping to enhance customer experience and prevent overstocking. 

• Logistics/distribution – A small regional distributor could use ERP software to optimise delivery routes, monitor warehouse stock and track shipments in real time, helping to minimise transport costs and ensure delivery accuracy. 

• Hospitality – A small hotel chain could use ERP software to manage room reservations, coordinate housekeeping and analyse occupancy rates, to cut costs and ensure higher guest-satisfaction rates. 

• Construction – A small construction firm could use ERP software to manage its work on multiple job sites, as well as manage expenses and ensure regulatory compliance, helping to keep projects on schedule and within budget. 

  
  

9 There are key factors to consider when researching ERP software options

Most small businesses choose cloud-based ERP software. The upfront costs are lower, the pricing is subscription based and you benefit from automatic updates, remote access and scalability. Your ERP software modules should directly support successful operation of your business. They could include finance, sales, marketing, CRM, people management, payroll, inventory, procurement, project management and manufacturing modules.

Focus on where you need your ERP software to relieve pain and add value. Ask for ERP software recommendations from other small businesses you know and research potential options online. Contact ERP software providers for advice, take advantage of free demos and find out what support and onboard training is available.

10 ERP software may not be as expensive as you imagine

ERP software pricing varies, but for cloud-based ERP software, budget for £50-£250 per user per month. That is not a small amount of money for many micro businesses, but that cost should be considered against the potential savings and productivity gains. Cost is influenced by several factors, including user number, modules included, implementation and training costs, customisation needs, etc. The more you need, the higher the monthly cost.