ERP System Example: These Areas Benefit From ERP Software

Daniel Pammé 2/8/2022

We show you examples of the areas where you can use ERP systems

Our guest author Daniel Pammé has dealt with the topic of ERP systems and for this he has chosen the best examples that you can implement directly in the appropriate areas.

Table of Contents

1. What is an ERP system?

2. Why is an ERP system useful?

3. What ERP systems are there?

4. ERP system examples: You should use an ERP system for these 5 areas

5. Which ERP systems are recommended?

What is an ERP system?

ERP stands for “Enterprise Resource Planning System” and is considered the digital headquarters of your company. By “resources” we mean, for example:

Capacities
Capital
Personnel and production resources,
and related processes

In an ERP, all important, everyday tasks such as purchasing, selling, production or customer service can be done in one place.

By now, most ERP system providers cover a large part of various business areas. In which areas the use of an ERP is worthwhile I will show you here in my guest post. But first, I will explain why an ERP system basically makes sense for your company:

Why is an ERP system useful?

Basically, an ERP brings countless advantages. I have summarized the most important ones for you:

Your team works with current, reliable data

No matter whether startup, SME or large company: centralized, current and well-maintained data are a great relief in daily business. With your “Single Source Of Truth” all employees have access to customer, product, project, sales and purchasing data in real time.

Cross-departmental processes go hand in hand

At the latest, when several team members work in different departments such as purchasing, warehouse, production and shipping, there is no alternative to an ERP. My tip: Try to find a suitable ERP as early as possible and, if possible, adapt or rethink your processes accordingly.

As unfamiliar as it may be at the beginning, you will quickly realize that many years of experience and best practices lie behind the workflows of the ERP providers. At the latest when onboarding new employees or increasing order volumes, you will notice that good processes save a lot of time and nerves.

Your sales channels come together in one place

But even if you are only a small team and an ERP seems too oversized to you: if you sell via several channels (e.g. your own online shop and amazon), an ERP system is definitely worthwhile.

All orders are imported into the system via an interface. This not only makes evaluation easier for you, but also all subsequent processes, such as invoice creation.

You keep an overview of warehouse and supply chain

Whether you produce yourself or trade with foreign goods – the timing in purchasing and the rotation of goods in your warehouse are one of the most underestimated factors for business success. Either raw materials and goods lie around in the warehouse for too long and tie up capital or you go out of stock. Both risks can be at least minimized with an ERP system.

Based on stock levels, sales figures and delivery times of your suppliers and products, an ERP shows in time when and how much needs to be reordered. Some ERP solutions are even able to automatically reorder goods.

Your accounting is simpler and more effective

Especially in e-commerce, multiple payment streams are daily business: Paypal, Amazon, Klarna, Sofortüberweisung, Stripe - with your business, the number of payment partners grows and so does the effort in your accounting.

Again, it shows how valuable the centralization of an ERP can be, because all your payment flows come together in one place. With a few clicks, the data can be exported in DATEV format for your tax advisor.

What ERP systems are there?

Cloud

The biggest advantages of a cloud solution are definitely security, availability and maintenance. As a rule, most ERP providers guarantee an uptime of 99.9% and release new updates and features at regular intervals.

Important to know: all your company data is on a foreign server, in most cases GDPR-compliant in Germany or the EU. A stable internet connection is a prerequisite.

On Premise

Here, ERP software and your data are on your own server. This will bring more disadvantages than advantages for most of you, because setup and maintenance are much more complex.

But especially for larger companies, this offers the security of having software, maintenance, updates and data in-house.

ERP system examples: You should use an ERP system for these 5 areas

ERP in E-Commerce

The main headquarters for your multichannel business: central and synchronized

If you sell on one or more marketplaces like Amazon, eBay or Kaufland, an ERP brings great relief in daily business. Here you keep an overview of all important data in real time.

Multiple shipping partners, one process

If you ship with multiple logistics partners like DHL, UPS or Hermes, shipping can quickly become a bottleneck.

If you still type in delivery addresses manually in the shipping portal and print them out individually, I recommend a combination of ERP and an interface provider like Sendcloud or Shipcloud.

The big advantage: With the help of APIs (interfaces), the delivery addresses of the orders are bulk transferred to your shipping partners and the labels are automatically played back into the ERP. With a few clicks, delivery notes and shipping labels can be printed out.

Product Data Management (PIM) at one place, even for multiple shops and shop systems

Product data is usually in several places. For example, in Excel lists or your shop system. The problem: there is not THE one “Single Source Of Truth”, i.e. the data set on which everyone can rely that it is the most current.

If you work with an ERP and product data changes, these are updated in exactly one place: in the article database of your ERP system. From here, all others (usually in real time via interfaces) pull the most current data.

This means: less effort in data maintenance and less risk that outdated product data will appear somewhere (for example in your shop frontend).

ERP for your Amazon Business

Automatic invoices for your customers

In fact, for a long time we manually uploaded invoices upon request in the Sellercentral. Until we came across a really time-saving feature in our ERP: with a tick in the interface settings, the invoices created in the ERP are automatically uploaded to the Sellercentral.

PAN-EU Shipping

The PAN-EU shipping with Amazon is one of the most discussed topics in the seller forum, because among other things, due to the tax issue it can become a real time-consuming task.

With the so-called "pan-European shipping" by Amazon, FBA sellers can store their goods in all major European marketplaces and sell their products from there.

In your ERP system, you can directly trace and control inventory and accurately display the correct VAT on your invoices.

Combination of Amazon FBM and FBA

If you ship Amazon orders yourself as well as work with an Amazon warehouse, an ERP saves you a lot of time and nerves. The orders imported from Amazon are sorted and filtered by sales channels. With a few clicks, the FBA orders can be posted through for accounting and the FBM orders can be given to your fulfillment.

ERP in retail

POS system

Most ERP providers work with common POS hardware, but also offer their own interfaces for tablets and smartphones.

Flexible user management

Each team member receives their own customer account with their own access rights. This way you control who has access to which data and functions in the ERP and also allows individual time recording.

All receipts in one place

Whether it's card payment, cash payment or mobile payment - if you offer multiple payment methods, an ERP has the decisive advantage that all incoming payments are centralized and summarized and can be exported in DATEV format for your tax advisor.

ERP in the food and cosmetics industry

Batch system and traceability

If you deal with or produce food or cosmetics, a batch system is absolutely necessary. So when researching, make sure that your ERP provider brings such a system.

From purchasing, production to shipping, you can trace every batch and, if necessary, determine which orders shipped which batch.

Quality management and goods receipt

Every goods receipt is recorded in your ERP. You can digitally record the documentation for quality assurance, such as sensory testing of the goods or ensuring certificates (e.g., organic food), and retrieve it with a few clicks. This saves time and nerves when the food inspector arrives or when the organic control is due.

Production like the big ones

Even though setup takes some time and employees need to be trained: Definitely check out the features for the production department of your favorite ERP system.

As a rule, there are precise production steps behind each product to be produced, which will help you enormously in setting up professional processes. Every production is its own order in the ERP with all relevant data such as production time, batch, processed raw materials and more.

ERP for wholesale

No more "Out Of Stock" thanks to automated disposition

Especially with several suppliers and articles, the purchase planning can quickly get confusing. Most ERP providers help you with a semi- or fully automatic disposition to better plan your purchase. Based on sales figures and delivery times of your suppliers, the ERP either suggests when something needs to be reordered or even takes over the order for you automatically.

Full process control

Even though the range of functions compared to pure sales tools like Salesforce CRM is somewhat slimmed down, you can structure the entire order process very well in almost every ERP. From leads and opportunities, offers, orders, invoices and delivery notes, everyone in your team can find everything in one place.

Digital warehousing

At the latest at the annual inventory, you will be very grateful for an ERP. With a few clicks you can create inventory books, print out inventory data sheets or directly record inventories digitally. Based on the data from purchasing, an inventory valuation according to IFRS or HGB is also created directly for your annual financial statements.

Which ERP systems are recommended?

To get a better overview of which ERP systems come into consideration for you, read the articles on ERP systems for small companies and for medium-sized companies.

On OMR Reviews you can see at a glance which ERP providers are particularly popular and have received good reviews. A first important indicator for your pre-selection.

Examples: popular ERP systems

SAP S/4HANA Cloud, public edition

As is the case with so many things, there is not THE best ERP. The best thing to do is to sit down with your team first and consider which areas an ERP should cover, which processes you want to digitize and what your requirements are.

Get demos of the different ERP systems or register for a test access and play around with the software. This will give you a direct impression of the differences.

Don’t forget: The providers have very different pricing models. So think carefully beforehand how many accesses and modules you need and whether your ERP can grow with your business.

Author

Daniel Pammé