The 15 Most Important Benefits of an ERP System for Your Company
We reveal to you 15 ERP system advantages that show how much time and work you can save with it!
- What does ERP mean?
- Why do companies use ERP systems?
- 15 Advantages of ERP Systems for Your Company
- These ERP systems support your company
- When is setting up an ERP system worthwhile?
Last year we faced the task of bringing our company VANDLEZ to the market through our own online shop. We spent over a year developing our candles, diffusers and home scents, and admittedly pushed important administrative processes ahead of us.
Because the biggest questions arose only when it came to getting e-commerce, warehouse, orders, invoices, fulfillment, finance and coordination of operational work steps under one roof. The term that we encountered again and again in our search for solutions was ERP. We had both previously dealt with the subject in previous jobs, but we really didn't know much about it.
In this article you will learn what ERP systems are, why companies use ERP systems, 15 unbeatable advantages of ERP systems and how ERP systems have helped us at VANDLEZ from the beginning to run a functioning company! The article will primarily focus on our experiences with our ERP system in relation to everyday e-commerce business. If you want to delve deeper into the subject, the OMR Reviews have more content on the topic of ERP ready for you!
What does ERP mean?
ERP system stands for Enterprise Resource Planning System and is therefore a software for resource planning (personnel, capital, operating resources, material as well as information and communication technology). It is often also equated with a merchandise management system. Often, in relation to this, one speaks of a central nervous system of a company, the pivot point of all goods, finances, master data of customers, suppliers and processes in the administrative as well as operational area.
An ERP software enables all employees of a company to have access and overview of all important processes in everyday work at any time. ERP systems not only represent purely digital databases, but also enable a transparent and uncomplicated way of working. The general aim of these systems is the digitization, centralization and process optimization of all work steps and data.
Why do companies use ERP systems?
That ERP systems are not just for large companies with highly complex processes and countless employees, has been clear at the latest since the growing offer of various software providers, who also hold appropriate price and application models for small start-ups and public companies. Companies use these systems to create a central, digital organ from the outset, which guarantees the smooth running of all processes and workflows as well as facilitating the possibility of scaling and growth.
Many smaller companies initially avoid setting up an ERP system, partly for financial reasons, partly due to a lack of information. Of course, especially small start-ups can initially be able to get by without such a system. The first orders in the online shop, the maintenance of data and the onboarding of first team members seems easy to handle without an ERP system. However, as the number of orders, the complexity of the supply chains and the number of people involved in the company increase, even the best organized founders start to sweat.
ERP systems offer the necessary overview and help so that no orders can be rejected due to overload or lack of time and no opportunities can be lost. Handling of orders, offers and invoice issuance, goods orders and financial overview are easily handled by a few clicks. No paperwork, no additional Excel tables and no self-built databases anymore, instead a central pivot point that simplifies, automatises and optimizes all processes.
15 Advantages of ERP Systems for Your Company
You are probably already looking for information and answers about ERP systems on the keywords centralization, digitization and process optimization. We too were overwhelmed with abstract phrases and promises, but could only apply them to our explicit situation with difficulty. So that you get a better insight into the daily work with ERP systems, we have listed for you 15 advantages of ERP systems that not only sound good in theory, but will advance you in practice! We will primarily give you an insight into working with ERP systems in connection with e-commerce.
- Keep an overview of your articles: As a company that offers and sells physical goods in e-commerce, it was essential for us to record all articles, components and goods as digital items. ERP systems give you the opportunity to do exactly that quickly and clearly.
In this way, you create a database that holds all the goods and products you deal with or work with. SKU's, physical properties, unique descriptions for identification, stocks and goods inflow - everything can be seen at a glance. - Production items, bill of materials and warehouse items: Since we wanted to outsource our warehouse and fulfillment from the beginning to ensure the best possible and professional handling of all orders, we had to ensure the optimal inflow and provision of all products. ERP systems allow you to create bill of materials or production items from different warehouse items, which your fulfillment service provider can understand and implement at a glance.
Through the software, you can assign a wrapping to an item, determine how and when an item should be packaged and specify which parts an order should consist of so that your customers receive their orders just as they ordered them. The integration of new products is also quick and can be communicated digitally and unambiguously with your team. - Setting up interfaces: When an order arrives at your online shop, it needs to pass through various instances. ERP systems enable you to establish the necessary interfaces so that all processes run fully automated without you having to take any action. For example, the order, i.e. the order, is transferred directly from your shop to your ERP system.
Your fulfillment is notified which items need to be packed in which way and in what quantity. Then the system captures the shipping information and informs your customers that the order is on its way. - Who are your customers?: Not only all information about your online shop customers is used by the ERP system in compliance with data protection and used for smooth operation, but you can also import wholesale customers and retailers and store all information. So you maintain and expand your customer database in a simple and efficient way.
- Who are your suppliers?: Where did you order this or that raw material last year? What did the packaging XY cost in the last delivery? What did the supply chain for your products look like? With an ERP system, you do not need to search through mailboxes or notes for the answers. You always have insight into suppliers, delivery conditions, purchase prices and all other information. In this way, you facilitate product development and sortiment maintenance.
- Who can do what? Define conditions for certain roles: You have had bad experiences with certain customers? You want to handle individual orders particularly sensitively or exceptionally? No problem - Simply set conditions for certain people or roles in your ERP system, whether it be a delivery block, a block for automatic shipping or other framework conditions. In this way, you can be sure that all customers are treated according to your wishes - and that it is completely automatic.
- What do you have, what do you need? Keeping an overview of the warehouse: As already explained, you can create and manage every item, every component, every packaging and every bill of materials in your ERP system. A daily, quick look is then enough to determine where bottlenecks could occur and which goods are available in sufficient quantities. This way, it is possible to prevent items in your online shop from being out of stock. If that does happen, the ERP system shows you how many items you have reordered and when they will arrive in your warehouse.
- Orders / Orders management: Whether you handle and ship your orders yourself or have contracted a fulfillment firm: It is essential to get quick and uncomplicated access to every order. This way, you can track what was ordered, where the order is going and where it is currently located on request of your customers. Reorders, returns and short-term changes are thus reliably and clearly implementable.
- Offer - Order - Invoice: Retailers and wholesale customers can these days obtain quotes for comparable goods from countless companies within a few minutes. If you still have to create, calculate and send your offers manually, you are wasting valuable time, which gives your competition a decisive advantage.
ERP systems make it child's play for you to create individual offers and pass them on professionally to the relevant contacts. Once created, the offer can be adjusted, deleted or ideally processed directly as an order. The ERP system then automatically creates the invoice for you, which can be sent to your customers. - Who owes you what? Keeping track of finances: With a steadily growing customer base, it is becoming increasingly difficult to keep track of everything and have important information at the push of a button. ERP systems summarize all your customers' parameters for you.
So you can see at any time who has paid which invoice, who owes you which amounts, and differentiate between reliable and unreliable customers. In this way, not a single cent will slip through your fingers and you will save yourself annoying calculations. - Shipment tracking: Probably the most frequently asked question in the customer chat: "Where is my order?" Although it is now standard to be able to track the package independently, as a seller you should always be able to keep track. Through your ERP system, you can even track weeks after the order whether, where and when the package was delivered.
- What went wrong? Analysis of error sources: Since an ERP system gives you transparent and detailed information about the process of every order, you can easily check where and why a mistake has happened, why there were complaints or where potential error sources lie. Recognize - Fix - Move on - Without time-consuming and annoying processes.
- Goods orders through a click: As already explained in the 7th advantage of ERP systems, the merchandise management system - the name suggests it - facilitates the handling of your goods and goods. If you need replenishment of a certain raw material or product, you don't even have to write an e-mail or pick up the phone anymore. Once the necessary data has been entered, a mouse click is enough to trigger an automatic goods order.
- Data maintenance made easy: The previously discussed ERP system advantages probably suggest to you that setting up all these functions represents a huge effort. In fact, most ERP systems are now very user-friendly, allowing you to get started quickly. Once the foundation is laid, it is actually a child's game to maintain existing data, keep it up to date and supplement it.
- Scalability: Whether your own company is scalable, of course, depends on many factors. However, with an organized, clear and transparent work structure, you are able to set the conditions for your own scalability yourself. With an ERP system by your side, you work professionally and purposefully from the beginning, without accumulating major construction sites in digital organization in the course of the first few months or years.
Those who take care of this organization early on have more time for the important things later on! With a suitable ERP system, your processes run centrally, digitally and automatically. So whether you generate one or a thousand orders per day via your shop - The merchandise management system keeps track.
These ERP systems support your company
At VANDLEZ we were lucky to get a comprehensive ERP onboarding through our fulfillment provider even before our market launch. Since then we've been working with the software Xentral and are more than satisfied with the workload that the system takes off our hands every day. Xentral includes all listed advantages and many more functions. The software offering is constantly growing and now offers the right model for every company size.
In addition to Xentral there are of course also many other ERP systems, like Billbee, SAP, weclapp, e.bootis, Microsoft Dynamic 365 Business Central, Sage 100, Oracle or myfactory. They all support you in your daily work and take a lot of work off your hands with regard to your resource planning. Each software has its own focus and it is up to you to find the right ERP software for you that meets your requirements.
Other popular ERP systems:
JTL
microtech büro+
360ᵉ by e-velopment
DreamRobot
NEKOM
Pickware
MyfactoryOn OMR Reviews you can find an overview of our ERP systems and also get honest and verified user experiences and user ratings of the different ERP tools.
If you need a more detailed comparison of the tools, then read our articles on the best ERP systems for small businesses and the best ERP systems.
When is setting up an ERP system worthwhile?
You have just founded a start-up, are setting up an e-commerce shop, want to offer certain services, build up a customer base or give your existing, dusty company a push to the next level? In each of these cases, ERP systems are the tool of your choice. It pays to deal intensively and early with the topic, to get involved and to digitize, centralize and thus optimize all processes of your company!
Which ERP system ultimately suits you and through which software you can complete, expand or upgrade it, you will find out at OMR Reviews!
Ich bin Marie Brandenburg, Gründerin von VANDLEZ, einem E-Commerce-Start-Up, das den Markt revolutioniert hat. Mit über sieben Jahren Erfahrung im digitalen Marketing bei internationalen Unternehmen und drei Jahren Selbstständigkeit habe ich mich in den letzten 1,5 Jahren auf Prozessoptimierung und Automatisierung spezialisiert. Derzeit baue ich ein neues Unternehmen auf, das genau auf diese Themen fokussiert ist – denn effiziente Prozesse sind der Schlüssel zum Erfolg!
Sebastian hat 2021 - zusammen mit Mary - das gemeinsame Unternehmen VANDLEZ gegründet, seinen bisherigen Vollzeitjob gekündigt und sich in die Selbstständigkeit gestürzt. Seitdem versorgen die beiden ihre Kund:innen im D2C- sowie B2B-Bereich mit veganen, tierversuchsfreien und nachhaltigen Kerzen, Diffusoren und Raumdüften. Eigens entwickelte Rezepturen werden inzwischen mit Traditionsfirmen in Italien und Österreich umgesetzt. Alle Produkte sind PETA-approved, verfügen über eine CO₂-neutrale Lieferkette und machen die Kerzen- und Duftindustrie grüner, natürlicher und nachhaltiger.
