If you're a small business owner, you've likely been through your share of software headaches. The problem is that every business has its own needs, and there is no cookie-cutter solution. As they evolve, most small businesses end up cobbling together a variety of software services and apps to create a software potpourri that delivers most of what they want but is far from ideal.
But more and more small businesses are turning to enterprise resource planning applications to integrate all their processes and data into a single system. Once reserved for big corporations, ERP systems are gaining traction among entrepreneurs who want to their small businesses to appear and operate like enterprise-scale businesses.
Here are five reasons ERP applications make sense for small business owners.
Perhaps the most attractive reason for a small business owner to move to an ERP system is that it can help reduce overall operating costs. By using one enterprise-wide software application instead of an array of department-wide apps, your business can save money on software and management fees. While the initial cost of an ERP application can be substantial, these systems can save small businesses a lot of money over a short amount of time, allowing business owners to recoup costs.
Small business ERP systems are typically built with customizable modules. You only have one monthly bill, and you don't get charged for what you don't use. An ERP suite of tools usually has hundreds of available modules, all of which operate similarly from a user perspective, which makes the system easy to learn. Businesses can add or subtract modules as they like, creating a bespoke software solution that is neither too complex nor too lightweight.
Fast-growing businesses often run into problems when different departments have historically compartmentalized data in different places. For example, the inventory data may be kept in one software program while the financial data is kept in another. With ERP software, everything is in one place, and users can access all authorized data quickly and easily.
When all of your business data is easily available to all departments at once, your employees are empowered to access the information they need without having to contact employees in other departments who are familiar with the software. In many cases, this increase in productivity is enough to allow businesses to avoid having to hire new employees to process paperwork now that a single database connects all data. These savings alone can allow small businesses to recoup their ERP investments quickly.
Thinking in a bubble often happens when employees don't have access to the data they need because they are unable to see the big picture within the company. With an ERP system, employees from different departments can share data in a way that's impossible when there is a different software application for each function.
An ERP system lets you be confident that you can access the data you need when you need it, and that the data is up-to-date. Moreover, ERP software greatly increases the types of useful information you can include your reports, which can lead to better analysis and decision-making.
For example, since small business ERP systems integrate e-commerce with marketing tools, your marketing reports can now deliver much more useful information. While many e-commerce marketing reports only tell you how many people clicked through to your site, an ERP system can let you also see the actual sales that resulted from a specific online marketing campaign.