What is the Difference Between a Merchandise Management System and an ERP?

Even though in many minds inventory management systems and ERP systems are stored as one and the same and are often used synonymously, this is not entirely correct. The systems serve different requirements in a company. The precise difference between tools for inventory management and ERP systems is explained here.

The fundamental difference between inventory management system and ERP system

The basic difference first: An inventory management system (often also called WaWi or WWS) deals exclusively with the movement of goods - i.e., inventory management - in a company. ERP systems go beyond this and are intended to map overall resource planning. Thus, they are in a sense extended inventory management systems.

What exactly is an inventory management system?

An inventory management system is there to map all goods movements or the material flow in a company. In addition, a system for inventory management is used to sort and structure materials. Materials include, for example, raw materials, spare parts, end products but also waste products.

Functions of inventory management systems

• Determination of demand
• Procurement of goods
• Warehouse management
• Sales and sales of goods

And what exactly is an ERP system?

An ERP system can also do everything that inventory management systems can do. However, the scope of a tool of an ERP system goes beyond the functions of an inventory management system. An ERP system is there to cover the entire resource planning and is therefore often much more complex than an inventory management system. This includes not only the movement of goods but also topics such as finance and personnel. Since an ERP system thus covers more functions, it is also suitable for more industries than an inventory management system.

Functions of ERP systems

• Basically all functions of an inventory management system
• Production planning
• Customer relationship management and sales
• Personnel management
• Financial and accounting
• Controlling

If you want to know more about the different ERP systems or are currently looking for an ERP system, you can compare all the tools mentioned based on real user reviews at OMR Reviews.

Inventory management systems, WaWi, WWS (or whatever name you know them by) and ERP systems are therefore not synonyms, but different systems that pursue different goals.