As companies grow, they often reach a stage in which spreadsheets become insufficient to manage the day-to-day business activities. At the point where small businesses need to scale up, ERP solutions for small businesses become necessary. What is an ERP solution, and how does it benefit small businesses?
ERP stands for Enterprise Resource Planning. It’s software designed to manage the day-to-day business activities and core functions of business processes including accounting, manufacturing, supply chain management, sales, marketing, and human resources.
An ERP is programmed into the central database of a business, creating a connection between multiple business processes and allowing data to seamlessly flow between them. With data from all the departments, ERPs can automate business processes and provide insights and internal controls.
When the technology was first introduced, only large organizations could afford to invest in Enterprise Resource Planning systems. However, with innovation and improvements in the technology, the complexity and cost of ERP systems have dropped drastically, giving small-scale businesses access to the benefits once reserved for larger companies.
ERPs are often implemented in small-scale industries when there is a rise in the number of employees, exploding demand for products or services, or increased production. In rapidly growing small-scale industries, old accounting solutions often prove incapable of keeping up with growth. ERP systems are flexible and can be tailored to meet the needs of every business.
Small-scale businesses can benefit from the shared transactional data created and managed by ERP systems. This interconnectedness and synchronization eliminates data duplication and provides data integrity with a single source that tracks all aspects of production.
In evaluating ERP vendors for small to medium business, emphasis should be placed on the needs of a business. An ERP system can be used as a management tool, customer relationship building tool, employee productivity tool, and more. There are several ERP solutions for small business, but below are some of the best SAP versions for small businesses looking to implement ERP:
What is the importance of ERP for a small business?
ERP systems provide a model that helps small-scale industries integrate and manage their employees, business processes, and technologies. Before choosing an ERP software, be sure it suits your business model and integrates with your existing business management software.