Top 6 ERP Systems for Small Businesses

If you’ve had complaints from customers, there’s a good chance your inventory and order management systems aren’t working well. Stay cool: there is one way to reduce operational costs and make it easier for your customers to get the products they want, faster.

An Enterprise Resource Planning (ERP) system comes in handy no matter the size of your business and ecommerce platform you use. Even those merchants that embrace the advanced Magento Commerce Cloud features still take advantage of ERP software that streamlines their business operations.   

In this article, we want to review some top-performing ERP systems for small businesses and share our expertise integrating them. But first things first: let’s dissect the concept of ERP to understand what it is and why it’s so important. And only after that you will be able to understand what is the best ERP for small business for you.

What is ERP?

ERP software organizes core processes of the business, like order and inventory management, customer relationship management (CRM), procurement, distribution, and supply chain operations, among others. Used by the government, commercial, and retail institutions, the system gets the product from the manufacturer to the seller and from the seller to the buyer. 

ERP acts as an all-in-one “central command center”. Business owners can see analytics reports and, thus, make crucial decisions to increase sales and improve planning and productivity.

We’ve established what an ERP system is. But before you know which is the best ERP software for small business, we need to understand how it works and why you need one.

When Do You Need an ERP System?

Without an ERP solution, your business can suffer serious consequences like mixed up orders, incorrect shipping info, invalid inventory levels, and incomplete product information. Eventually, your sales and ROI will suffer without an ERP.

Most businesses can’t function without an ERP because the manpower required to do what an ERP does isn’t economically viable. Our client, Dampfi, decided to build an ERP system for this exact reason.

No large ecommerce business can operate without ERP. But what about small and medium-sized businesses? Do they also require ERP software?

It is theoretically possible for a smaller store to function without an ERP. For example, you can get by with pen-and-paper order and inventory management. There is also the somewhat less archaic Excel spreadsheet option, but in any case, managing a store manually is highly ineffective.

Realistically, the only scenario where you don’t need an automated or semi-automated ERP is if you’re just starting out with an online catalog or working on a proof-of-concept. You will still need an ERP eventually, once you decide to build a fully-functioning ecommerce store and look for which ecommerce platform is the right choice.

While there’s no all-in-one solution software for every business process, ERP system for small business can take the brunt of your workload and bring your business processes together in a more cohesive way. With this in hand, you can help your company make data-driven decisions.

So how do you know what kind of system you need? To answer that question, you first need to identify:

1. Your current order volume
2. How you fulfill orders, as well as your shipping methods and requirements (e.g. customs declarations)
3. If you need to connect brick-and-mortar stores or warehouses with your online store(s)

There are various ways to add a Magento ERP solution to your e-store. Here are your options:

Use The Best Magento ERP Solution For Your Store

Before we get down to the list of the best ERP for small businesses, it’s worth looking into the ecommerce ERP integration options a Magento merchant has.

There are four ways to integrate an ERP on Magento:

1. Magento store management tools out-of-the-box
   Magento has very basic tools for managing your store. You can add products and product categories, manage inventory, and track orders directly from the Magento admin panel. This is a decent option for a store just starting out, but if orders start flying in, you’ll quickly become overwhelmed.  
2. Third-party ERP integration
   This enterprise-level solution works best if your business has grown beyond the capacity of ERP extensions (the BoostMyShop extension supports up to 20,000 products and 500 orders per day). Our ERP integration guide covers the specifics and pros/cons of ERP integration options. SAP ERP, Netsuite ERP by Oracle, and Microsoft Dynamics ERP are the big three to look into.
   The advantages of externally integrated ERPs include cloud-based databases and more robust features. Mind, though, that the costs for integrating and customizing the ERP system are considerably greater than a native extension.
3. Magento ERP extension
   Adding an extension is one of the easiest ways to quickly implement an ERP system. There are several popular Magento ERP extensions available — one of which is Embedded ERP by BoostMyShop (BMS).
   A native Magento extension has the following advantages: it uses a locally hosted database (not cloud-based), it’s cheaper compared to third-party integration, it offers more control over customizations, and it’s cheaper to customize.
4. Develop your own ERP from scratch
   The most expensive option is to develop your own ERP system for small business from scratch. This option is only viable for major industry players or government organizations. The costs of development, server costs, and time required to accomplish this endeavor are simply out of reach for most ecommerce stores.

Mind that every store has its needs and requirements that will determine the choice of an ERP system for small companies. A wholesale distributor will need a flexible ERP system allowing to manipulate complex product data. A small ecommerce shop owner will be interested in an easy integration with some most popular platforms, like Shopify. In the following sections, we’ll review the best ERP software for small businesses by industry.

Best ERP for Discrete Manufacturing

Discrete manufacturing implies assembling a distinct product unit from a number of parts and components. Unlike other types of manufacturing, a discrete manufacturer produces products that can be counted, seen, and touched, like smartphones, garments, sports equipment, etc. Discrete manufacturing ERP software can usually boast of dead-on production planning tools alongside barcode scanning and product life-cycle management capabilities.

An absolute leader in this category of ERP software is Apprise, and let us explain why.

Apprise

Apprise is an ERP solution designed specifically for manufacturers and distributors. Founded in 21984 and acquired by Aptean in 2017, Apprise is now serving 6,500+ merchants worldwide across various industries. Its main advantage is that Apprise ERP integrates elements of supply chain management (SCM) services that allow it to monitor purchase orders (POs) from the manufacturing floor to order delivery.

Here’s what Apprise ERP offers for discrete manufacturers:

• Analytics and reporting tools: compare product-specific data, turns, and earns against the backdrop of key performance metrics.
• Optional customer & supplier portal with online inventory, billing, and pricing information.
• Demand planning and inventory needs forecast.
• Apprise Manufacturing tools for inventory control, capacity planning, and production scheduling.
• Retail compliance (including UCC 128 labeling, EDI, RFID, dynamic routing for orders for other retail and mass merchant partners).

Apprise ERP can be hosted on premise or in cloud, which makes it an appealing option for any business type.

Best ERP for Process Manufacturing

Process manufacturing (also known as batch manufacturing) relies on recipes and formulas to create an item. Its goods cannot be dissembled into parts and usually include food, beverages, paints, pharmaceuticals, cosmetics, etc. Process manufacturing ERP includes many of the features present in discrete manufacturing ERP software, like inventory planning. Yet, the formula-based nature of the industry points at some unique needs of process manufacturers that should be covered by an ERP.

Our top favorite in this category of ERPs for manufacturing business is BatchMaster.

BatchMaster

BatchMaster ERP was created with process manufacturers in mind. The solution works on a formula basis and supports R&D, formulation, packaging, costing, production, quality control and assurance (QC & QA), and inventory modules. The beauty of it is also that it’s a scalable solution. On the one hand, BatchMaster stands alone as the best ERP software for a small business. But if combined with financial platforms like SAP Business One or Microsoft Dynamics GP, it can serve mid-size and large enterprises.

As the best ERP for manufacturing business, BatchMaster presents the following features:

• Lab and formulation module allowing to adjust formulas or recipes depending on the clients requirements or legislation-related nutritional criteria.
• Batch production calculator used to create and schedule the optimal amount of batch per product formula and/or package.
• Tracking and compliance reports ensuring a manufacturer follows all the industry-specific regulations (works with the U.S. Food and Drug Administration (FDA)!).
• Product costing tool calculating the hypothetical expenses on the development of a product based on the formula and the substances used.
• Inventory planning and mobile warehousing.

Batchmaster ERP is available on premise and in the cloud. Its pricing plan starts at $2,000.

Best ERP for Wholesale Distribution

Wholesale distribution accounts for the management and transfer of goods from manufacturers to retailers. Big players like Sysco and Cardinal Health usually ring a bell in this category. Yet, many wholesalers are actually small businesses — industrial distributors, farm product marketing cooperatives, drop shippers, etc. — who take responsibility for the product before its distribution.

Wholesale distributors need a powerful ERP with native quote-to-cash cycle functions. And Epicor Distribution Suite is just perfect for such wholesaling tasks.

Epicor Distribution Suite 

Epicor Distribution is one of the best ERP software for wholesale distributors. It provides the basic functionality all distributors need, including pre-production materials planning, manufacturing execution, and supply chain, among others. Interestingly, Epicor ERP has a modular system architecture, so merchants can purchase and install only those modules/functions their business requires. For distributors, in particular, Epicor ERP offers two solutions: Prophet 21 and Eclipse.

Epicor Prophet 21 is designed to streamline distribution processes during peak performance. Some of key features include

• Ecommerce module supporting B2B and B2C channels and running on Magento.
• Powerful financial accounting with general ledger, purchasing, and vendor rebates tools.
• Advanced demand forecasting for effective sales management.
• Wireless warehouse management.
• 24/7 tech support and Epicor Virtual Agent (EVA).

Epicor Eclipse is more suitable for day-today distribution operations and provides the following features:

• Intuitive user friendly interface displaying both customer communication and employee task workflow.
• Effective order management even when only partial product information is available.
• Business Intelligence and analytics that match vendor invoices and POs and create informative reports.

Epicor Distribution Suite can be installed on premise and in the cloud just like the aforementioned ERPs for manufacturing.

Read more: eCommerce POS integration

Best ERP for eCommerce

Now let’s change the focus from manufacturers to other key commerce players — retailers. Ecommerce merchants often seek automated solutions to run all their back-office operations. Smart inventory management and fast order fulfillment are the must-have features of all ecommerce ERPs. Pricing management and CRM should also be in place for merchants to keep tabs on leads, customer accounts, and opportunities.

Of all the available ecommerce ERPs on the market, our top choice for small businesses is QuickBooks Commerce.

QuickBooks Commerce

QuickBooks Commerce (formerly TradeGecko) is a cloud-based ERP for small businesses. It allows a merchant to manage orders, customers, and products from a single place. QuickBooks owners firmly believe in a decoupled approach to ecommerce. In other words, ERPs should stand separately from commerce and accounting operations, thus, making the business agile and easy-to-scale. 

QuickBooks Commerce includes the following capabilities:

• Inventory control specifying backorders, stock availability, batches and expiry dates across multiple warehouses.
• Cross-channel management of order invoices, payments, and shipments.
• Inventory and sales reports.
• Built-in CRM storing customers’ purchase preferences, types and history to understand their buying behaviour.
• Shipping module to create custom rates based on a customer’s location and a product’s weight.

Best ERP for the Food Industry

The requirements for the food industry ERPs are very similar to those of process manufacturing ERPs. Food manufacturers work with recipes and batches and, hence, require an adequate resource management system. Moreover, innovations are in trend in the food industry nowadays, so it’s important for manufacturers to comply with the respective norms and legislations.

bcFood addresses the challenges of the food industry and offers a a specialized ERP solution for small businesses.

bcFood

Built entirely on Microsoft technologies, bcFood focuses on the food-specific functionality for small businesses. It targets both food processors and manufacturers and tracks products from the field, to the processing plant, and to the retail shop. The ERP keeps up with the fast production pace during harvests and optimizes daily operations.

Some important features of bcFood are:

• Inventory management listing catch weights and item allergens in addition to QA & QC planning;
• Sales and purchase contracts, item pricing, enhanced dropshipping, among many other CRM features.
• Item traceability reports specifying the lot, the crop year, and the country of origin of an item.
• Recipe and packaging bills of material and production scheduling.
• Business intelligence and control reports.

A merchant can choose whether to install the system on premise, host it with the third-party provider, or access it from the cloud.

Best ERP for the Construction Industry

Construction industry owners place a heavy focus on automation in view of all the back-office, financial, and transportation-related issues. Because the goods are quite bulky and the tools to make them cost a pretty penny, constructors primarily look into powerful shipping and accounting modules in ERPs. Contractor management features are also important for construction ERP software to track collaboration and communication with independent contractors.

And here’s the top ERP solution we’ve found for construction companies — Jonas Premier.

Jonas Premier

Jonas Premier Construction Software is a cloud-based ERP for construction companies, land developers, and homebuilders of all shapes and sizes. The solution is appealing for its integrated accounting and job costing features that constructors find fundamental in their work. Billing, job time and expense, inventory management, and more allow merchants to handle complex orders and financial transactions while maintaining fruitful collaboration with contractors.

A constructor can also take advantages of the following features:

• Project dashboard which displays new and pending tasks, PRIs and PRFs, built-in industry standard KPIs, etc.
• Secure accounting that allows for multi-company inter-division transactions, detailed budget and trail balance, among others.
• A job cost module that prevents incorrect distribution and coordinates sub-contractors workflow.
• Demand and price forecasting.

Hosted by Microsoft Azure, Jonas Premier is a fully cloud ERP that allows merchants to access data from any device and any location.

Best Cloud ERP

So we’ve come to our last (but certainly not least) category of cloud ERPs. You might wonder why it stands as a separate category in this article if all the aforementioned systems have a cloud hosting solution. But there’s this one universal all-in-one system that we want to recommend and that merchants in any industry can use — Oracle NetSuite.

NetSuite ERP

Powered by Oracle, NetSuite ERP is a unified business management SaaS platform. It is used by 40,000+ organizations operating in 160+ countries that vary from manufacturing to retail industries. NetSuite is not only about the financials, which are undoubtedly vital to any business. It is also about human resources, customer relationship, inventory, shipping and billing management operations, all of which fit in an intuitive admin dashboard.

Let’s see which functionalities NetSuite ERP has to offer:

• Financial management: payment approval, automated transaction matching, billing, budget planning and reporting, etc.
• Order management: real-time pricing updates, workflow approvals, simplified returns process.
• Production management: product data and work order management, QA and QC, material supplies planning and production scheduling.
• Supply chain management: demand analysis and sales forecasting, warranty registration and repair, user-friendly interface for effective communication with supply chain partners.
• Warehouse and fulfillment: inbound and outbound logistics tools, warehouse activity dashboard, replenishment and tracking systems.

NetSuite ERP is one of the most popular integrations with Magento merchants for its flexibility and customization possibilities. The pricing starts at approximately $1,000+ per month, although the exact cost of ownership will depend on user count, module selection, and merchant’s individual requirements. 

Takeaways

When it comes to choosing an ERP system, you have to first identify your business needs. 

There are many various ERPs on the market these days, each tailored to the requirements of a specific industry. 

When you know what you need to accomplish and where you have gaps, it’s easier to justify spending more on a third-party integration rather than a Magento ERP extension. 

So next time, when you see your store running over 20,000 products and 500 orders per day (the limits of the Embedded ERP extension), you’ll know where to go. At Elogic we can integrate any of the ERPs listed above and customize it to your likings. 

Frequently Asked Questions

How to choose the best ERP system for my small business?

To choose the best ERP software for a small business, the first thing to consider is your needs and budget. Often, it makes sense to create your own small ERP system, which pays off within 1-2 years.

Is it possible to make a custom ERP specifically for a small e-commerce business?

It is possible to create an ERP system from scratch for a small business in the field of e-commerce in a short time. Everything will depend on the requirements and the budget you have.

What is the cheapest ERP system for a small business?

Today, a large number of ERPs for small businesses offer flexible pricing plans. Among them, one of the most inexpensive is Apprise. But, you can also look for other solutions.

Is it worth using the ERP for a medium business in a small business?

Generally, ERP software for medium businesses is great for small companies. There is practically no difference in this, except for the functionality and cost of using the ERP system.