All Efforts on the ERP: Why You Should Rely on Scalable ERP Software

Without it, it's impossible. Enterprise resource planning systems (ERP), are the circulatory system of any company. If you as entrepreneurs want to be successful in e-commerce, you absolutely need a functioning ERP system. All threads come together here and for the processes to work permanently, the system must be sustainably maintained. No compromises!

 

Why you should absolutely rely on an ERP system

In a trading company, the ERP system is the engine room where all work processes from different departments come together in one place. Being the central control unit is important to maintain an overview and do the right things in the right places. To make it clearer how this bundling can look like, here's a real-life example: Our brand and product development team at Mokebo works on new products, like a lamp series.

As soon as it is established that we are adding these lamps to our portfolio and all relevant information from the manufacturer is available, we can add them in the next step in our ERP system and feed this data record with information (product details like texts, prices, package dimensions, warehouse information, etc.) and high-quality photos. Additionally, settings must be made for individual product categories that determine how data is displayed on different sales platforms (for example, product features like 'power in watts' are particularly relevant for the product group lighting).

To link everything together, our entire operations team works daily in the merchandise management: In close cooperation with the suppliers, the stock situation is monitored to avoid out-of-stock situations. Repeat orders are triggered taking into account the current warehouse stock as well as reserved orders and daily average sales. Finally, the delivery time is calculated from the delivery possibilities of the manufacturer and the shipping process of the logistics service provider, which is then communicated to the customers.

The merchandise management system plays a central role in product configuration, enriching articles with texts and images from the content team and directing workflows through the operations team. It also comes into play after ordering to control customer communication through the customer success team. In addition, the finance team uses the data set of the ERP system to create reports and evaluate the data based on business intelligence. At a brand like mokebo, all core teams touch the merchandise management at some point in their working process. Here all gears must mesh.

In 2021, ERP systems - like so many other software solutions – exist in the cloud. Just a few years ago, expensive packages had to be purchased and implemented, so-called on-premise solutions. Today, cloud-based modular systems, which impress with their flexibility, increasingly serve as a hygiene factor for success. Companies can book exactly the applications they need and that bring them benefits. Everything else doesn't even need to be subscribed to. Agility is the priority.

At mokebo, we work in a hybrid model, partly in the Cologne office or remotely - a completely cloud and browser-based ERP system is therefore extremely important to us in order to maintain the processes. That's why we chose Plentymarkets, a solution that can be operated from anywhere and any operating system. We also value that the merchandise management system has a focus on eCommerce marketplace connections.

The keys on the ERP bundle: These functions are important in your ERP software

So our remote teams have real-time access, an ERP system in e-commerce must be agile and browser-based. On the other hand, merchandise management in eCommerce should be open and adaptable and be able to connect various plugins/apps via programming interfaces (APIs). Everything you need as a dealer that your merchandise management system can't offer, you can solve with plugins.

Third-party providers (or the ERP system itself) can usually make these available in marketplaces like PlentyMarkets and you can install the appropriate applications. Plugins range from connecting additional payment providers or accounting solutions to interfaces to various distribution channels like Amazon or Otto.

That was one of the most decisive factors why we chose Plentymarkets. For example, by integrating the DHL plugin, we can create shipping labels directly and independently, change shipping addresses, and make cancellations. The credo: Never leave your merchandise management for a business process that is integrable. All tasks from shipping to reordering to customer support can be done right there.

Where ERP systems need to improve

However, the ability to scale via APIs and interfaces is limited. My wish would be for an ERP system that offers many eCommerce and remote oriented benefits, but at the same time can be highly individualized. With Plentymarkets, there is a basic design of order or product data with ready-made design, which itself cannot be changed as much by plugins and APIs as the larger ERP systems from SAP - to name one.

Sure, we asked ourselves whether we wanted to switch to SAP. At that consideration, the simple formula comes up: The longer you go with an ERP system, the harder it is to turn back!"Plentymarkets has a sturdy heart. We can map over 80 percent of what we need with it. Additionally, we would have enormous switching costs, moving would by far be the biggest IT project we have ever had. Hence, it's all the more important to make the right decision in the first step.

I admit: A significant amount of work time from the past three and a half years has flowed into the construction of our ERP system so that we can scale all business processes: logistics, product data, connection to sales channels or data intelligence. But that's the only way to go. If you as e-commerce dealers want to be successful, you must take your ERP system seriously and bring all processes together there.

Merchandise management should always be the single source of truth. If you really want to do it right, if you want to guarantee perfect data quality and customer experience, then you need a functioning merchandise management system in one place and not distributed across various sales channels.

Begin with the end in mind: Rely on a scalable ERP

Looking at it from a different perspective can help. Just hopping from one transitional solution to the next is not a long-term solution. Imagine you're successful on several channels with many hundreds of products from different manufacturers. So you have a very complex merchandise management system.

If that's your goal, then you have to work back from there and think about what it takes to get there. We meticulously maintained our ERP system from the beginning through all departments and even a step beforehand: We chose a merchandise management system that can grow with us.

Beware of dependency: Switching to a new ERP system is time and cost intensive

Admittedly, this dependency also carries risks. DHL has had problems with their APIs from time to time in recent years. Due to system errors, countless dealers were suddenly no longer able to create their shipping labels via their ERP systems. Then it is red alert. If we dealers do not confirm shipping on time, the seller account with Amazon or Shopify gets bad reviews, slips down in search results, and customers understandably freak out.

That's why huge teams work in the field of maintenance at ERP providers like Plentymarkets to oversee everything, because they know that they have millions of euros in sales and thousands of orders per hour hanging on them. If anything goes wrong, they are responsible for it.

You should be aware of this dependency and still I'm convinced: From the point you want to sell more than a couple of socks, your ERP system will be the absolute heart of your enterprise. Anyone not working with a robust ERP system will lose in the long run.

Philip's top ERPs on the market

There are numerous different providers on the ERP market that sell their own products and provide different components. These top 8 have good reputations and good reviews:

Our choice

Plentymarketsdescribes itself as the 'complete solution for all important e-commerce processes'. And for us that's true. We needed an ERP system that works agile and browser-based so that we can access it from anywhere. Plentymarkets' open and adaptable solution also allows us access to major e-commerce marketplaces such as DHL.

For small businesses

Billbeeis a popular cloud-based ERP system that handles order and payment processing through marketplaces. Billbee is geared more towards smaller businesses, TheFemaleCompany uses this SaaS solution as its ERP system, for example.

Almost everyone knows

Shopify is probably one of the most known shop systems. With Shopify, retailers can easily manage their products and goods and connect to marketplaces such as Amazon. The main focus is definitely on the design and control of one's own webshop, even though ERP functionalities are also offered.

All flows in one ERP

Xentral, invested in by Frank Thelen and Christian Reber, positions itself as a full-fledged and cloud-based ERP system that can map all ERP flows (sales, logistics, team, product, finance and controlling). Xentral also offers many interfaces to payment solutions (Paypal, Amazon Payments), or marketplaces (Shopify, Amazon). Again, there is a big focus on e-commerce.

Strong through interfaces

weclappis one of the fastest growing e-commerce ERP systems and has a strong API-first approach - meaning a big focus on flexible connectivity to other solutions like payment providers orwebshop systems. WeClapp follows a very similar principle to Xentral and Plentymarkets and is extremely open and flexible. Startups like Cologne-based Naughty Nuts work with weClapp.

The all-rounder

Sage 100has significantly less e-commerce focus and more pure ERP features like procedures, accounting or inventory planning. They offer this solution on-premise and the ability to use a desktop application; but they also offer cloud solutions now. All tools from Sage can be found on our overview page of the software manufacturer.

Oracle ERPorSAP S/4HANAare especially ERP systems for larger businesses with global use cases and they are less focused on e-commerce, which is why we at mokebo focused more on other solutions when selecting an ERP system.

Further popular ERP solutions:

e.bootis-ERPII

JTL

microtech büro+

360ᵉ by e-velopment

DreamRobot

NEKOM

Pickware

Myfactory