Benefits of ERP for Small Business

Enterprise Resource Planning (ERP) is designed to help businesses run more efficiently by fully integrating a business’ computer system. ERP is used to get the applications within a company communicating. Without ERP, a company might own software for inventory tracking, another set for order management, one for accounting, one for payroll, and one for marketing.  It can turn out to be a complicated, time-consuming, error prone operation, unless the software systems can transmit data between each other. One of the great benefits of ERP is that it eliminates manual entry and human intervention by centralizing and standardizing the information that each department uses. This then allows for one central database for all of the applications used by a particular business. ERP can also facilitate processes that were once manual, making data available on a real-time basis.

Initially, no one bothered with small business ERP. Enterprise resource planning vendors designed software only for larger businesses.  Their product was meant to assist large businesses succeed. They also provided customer technological support to ensure that the purchased enterprise software would run exactly the way it was designed. But, again, this only helped large enterprises.

A significant part of the problem revolved around cost.  Since ERP systems can cost upwards of millions of dollars, not to mention the added cost of implementation and maintenance, many vendors worried whether small businesses could afford the product and, therefore, whether it would be worth their financial risk to initiate development of small business ERP.

For a long time, that impasse left only large businesses with the opportunity to improve their critical business practices and information flow by using enterprise resource planning software solutions.  It has really been only in the past 5 years or so that software vendors began to market ERP solutions targeting small businesses.

Research shows that small business ERP implementation definitely allows smaller businesses achieve a competitive advantage.  So today, almost three quarters of all new ERP clients are companies with annual revenues of less than $100 million. Most of these smaller business clients are implementing ERP because their rate of growth has placed a tremendous strain on their existing legacy systems.

Running smaller businesses today, often requires business applications as advanced and as complicated as the ERP systems used by larger businesses. Contact us to learn more about ERP systems that will benefit your sized business.

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