Shopify ERP integration: Types, key features and benefits

The global ERP software market is expected to reach $96 billion by 2032. Thus, modern businesses worldwide have started relying on ERP integrations more and more to stay competitive. Moreover, 95% of organizations report improvements in their processes following ERP implementation, which makes integrating Shopify with ERP systems not an option, but a necessity.

In this article, we’ll explore the different types of Shopify ERP integrations, outline key features to consider, and explain the numerous benefits these integrations can offer your business. Understanding and effectively using these integrations can optimize operations, boost efficiency, and prepare your business for scalable growth.

Understanding ERP in Ecommerce

What is ERP and how does it work? ERP systems are integrated platforms that combine core business functions such as accounting, inventory management, CRM, and supply chain operations into a single, cohesive unit. They ensure smoother processes and centralize data so the organization can function efficiently.

In e-commerce, where speed and accuracy are crucial, an ERP system would ensure seamless integration of the backend operations with platforms such as Shopify. Elogic’s expertise in Shopify integration with ERP ensures that these backend systems work in perfect harmony, reducing errors and enhancing operational efficiency.

Key benefits will include:

• Smoothened Inventory Management: It tracks stock in real time and initiates automatic reorder processes to avoid overstocking and stockouts, enhancing operational efficiency.
• Accurate Order Fulfillment: Workflows are automated, eliminating manual order processing and shipment errors.
• Improved Customer Experience: Real-time order tracking and updates promote transparency, which in turn promotes trust and loyalty.
• Scalability for Growth: ERP systems manage higher volumes of orders and their complexity, providing tools for business growth.

The Value of Shopify ERP Integration

Shopify ERP system integration offers countless advantages to e-commerce businesses:

1. Process Automation

ERP integration takes over the cataloging and updating of the stock and the formulation of tasks, such as processing the order, to the very end. Elogic ensures this automation is implemented without disruptions, tailoring the process to meet specific business demands.

2. Real-Time Data Syncing

An ERP system ensures that an organization’s data will always be synchronized, avoiding irrelevancy in key data like sales, inventory, and financials.

For example, updates on Shopify’s inventory will be reflected immediately in the ERP system; hence, there will be no underestimation or overstock.

3. Improved Inventory Accuracy

Inventory management, which executes in real-time and tracks data precisely and automatically, helps businesses achieve optimal stock levels with minimal waste.

The main benefit of correct inventory will be on the financial front since it will eliminate stockouts and keep customers satisfied with a steady supply of products.

4. Enhanced Customer Experience

Shopify ERP integration service gives businesses additional tools for faster order processing, real-time tracking, and more personalized shopping experiences.

For instance, the customer can monitor the warehousing process and delivery, generating an immediate response.

Types of Shopify ERP Integrations

Picking between the proper integration approach is the principal base on which enterprise requirements, resources, and elevation objectives are laid down. An experienced partner knows about the pros and cons of each ERP integration type, and Elogic is a trusted partner with extensive expertise in navigating these options.

Manual Integration

Manual integration is a method of data extraction and importation between Shopify and ERP systems lacking automation.

Pros:

• Low initial cost.
• Best suited for small businesses having a minimum of data.

Cons:

• Time-consuming and prone to errors.
• Unsuitable for firms that are expanding or have a high number of transactions.

Third-Party Apps for Partial Automation

Third-party integration apps are software applications that connect via API to systems like marketing applications or service platforms. They provide automated processes such as inventory synchronization or order updates.

Pros:

• Cost-effective and easy to implement.
• Eliminates the need for manual labor for general activities.

Cons:

• Restricted customization and scalability.
• The platform has to get various applications that perform different functions to fulfill the full functionality.

Fully Custom Integration Solutions

Customers’ special business workflows are required through custom solutions that are meant to fit them in such a way that they should be made to link Shopify with a hassle-free ERP system.

Pros:

• High flexibility and scalability.
• It enables intricate operations to be carried out and responds to unique requirements.

Cons:

• Higher initial cost and longer implementation time.
• Continued technical support and maintenance is needed

Shopify ERP integration

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Features of ERP Systems for Shopify Integration

With customers’ needs evolving and growing, staying still in your technical expertise is impossible. ERP systems for Shopify integrations go hand in hand with the growing market demands and trends and offer features that are necessary for any business willing to stay ahead of the competition. 

ERP Inventory Management

According to recent research, 91% of companies that have implemented ERP solutions report optimized inventory levels, leading to reduced carrying costs and improved cash flow. Moreover, ERP inventory system management enables you to trace your inventory in real-time, maintain stock levels, and reduce carrying costs.

Order Processing

ERP systems offer smooth order processing by fully automating workflows from order placement to fulfillment. With error reduction and faster time out, customer satisfaction tends to grow. For example, organizations using ERP systems have reported an increase in operational efficiency by up to 23% from integrated processes that eliminate redundancies.

Financial Management

ERP systems store all financial information to understand revenues, costs, and profits better. This centralization enhances data accuracy and allows organizations to make better financial decisions. Also, 86% of those surveyed said that they consider “accounting” one of the core features of their ERP systems, which shows how important this function is in financial management.

CRM Integration

Integrating ERP with CRM systems empowers businesses to offer personalized experiences by centralizing customer data. It enhances customer satisfaction and loyalty. Indeed, some organizations have reported a 25% increase in customer satisfaction after integrating ERP, which can be attributed to faster order processing and improved communication.

Reporting and Analytics

Advanced ERP systems provide enhanced reporting and analytics capabilities, which can provide actionable insights into different areas of business operation. These insights can be effective in decision-making and strategic planning.

Supply Chain Automation

Systematic supply chain integration with ERP streamlines supplier coordination and reduces lead times. It ensures that products will go to market promptly and enhances the supply chain as a whole. 

Shopify ERP Integration Benefits

Integrating Shopify with the ERP system offers many advantages in smoothing operations, enhancing data reliability, and growing businesses. Below are the main benefits that make this integration a game-changer for e-commerce businesses.

Operational Efficiency

An ERP system-integrated Shopify can automate order management, inventory updating, and finance reporting. In this example, the owner is integrating NetSuite ERP into Shopify. Now, reconciling warehouses will not have to be performed manually; what is saved in hours would be administration work. Not only are cost savings realized, but productivity is also improved.

Data Accuracy

ERP integration ensures that all systems have the same data through real-time synchronization. For example, an apparel retailer using SAP Business One with Shopify will automatically update its inventory after each sale to avoid overselling or discrepancies. According to Aberdeen Group, companies that integrate their ERP systems achieve faster decision-making due to improved data accuracy. Accurate data also helps avoid customer dissatisfaction from incorrect stock or delivery information.

Faster Order Fulfillment

Timely fulfillment is critical in ecommerce. Shopify ERP integration streamlines the order-to-delivery pipeline, as seen in the case of Bathu, which efficiently managed inventory across multiple locations, allowing them to open up to four stores each month. This capability led to a significant 26% increase in revenue, showcasing the impact of faster order fulfillment. 

Scalability for Business Growth

As your ecommerce business grows, handling increased orders, complex supply chains, and expanding product catalogs can strain your resources. Cloud-based ERP systems offer scalability to meet these demands. According to a study by Oracle/NetSuite, 65% of organizations have chosen cloud ERP solutions, highlighting scalability as a key factor in their decision.

Popular ERP Systems Compatible with Shopify

Integrating Shopify with the right ERP system ensures seamless operations and scalability. Here’s a breakdown of the top ERP platforms:

SAP Business One

• Ideal for small to medium-sized businesses.
• Features include inventory management, financial accounting, and CRM.
• Synchronizes inventory and sales data in real-time.
• Enhances supply chain visibility and operational efficiency.

NetSuite

• Cloud-based ERP designed for growing businesses.
• Automates inventory updates, order processing, and financial reporting.
• Handles large order volumes and complex operations.
• Offers robust analytics for data-driven decision-making.

Microsoft Dynamics 365

• Provides tools for finance, operations, and customer management.
• Real-time data syncing ensures accurate inventory tracking.
• AI-powered analytics enhance forecasting and decision-making.
• Scalable for businesses aiming to streamline fulfillment processes.

Brightpearl

• Tailored for ecommerce and retail businesses.
• Centralizes data across multiple sales channels.
• Automates inventory tracking and order fulfillment.
• Reduces manual tasks, improving overall efficiency.

Odoo

• Open-source and customizable ERP solution.
• Modules for inventory, sales, accounting, and CRM.
• Cost-effective for small and medium-sized businesses.
• Flexible and scalable to support growing Shopify stores.

How to Successfully Integrate Shopify with ERP

All around the world, businesses have started integrating themselves with ERP as part of a disciplinary policy to guarantee that the activities run smoothly and that they will also be successful in the long run. Below is a stepwise guide to this integration.

Assess Your Business Needs

The first important thing is to examine the business workflow and identify all the painful points,, such as manual inventory with no fast delivery. Then, you need to understand what these would mean for the operational needs built around the size of your business, the volume of orders, and growth targets. Features like inventory management, CRM integration, or advanced financial tools should also be considered when choosing critical ERP features for business.

Go for a Fit ERP System

Pick the ERP that suits your business needs and smoothly integrates with Shopify. For instance, a smaller business can choose Odoo because it is cheap and flexible, but bigger businesses might find NetSuite’s functionalities what they are looking for. Check that the ERP has sufficient scalability and features to develop a sustainable business growth pathway.

Plan the Integration Process

A well-defined and detailed plan is important for smooth integration. Once these considerations have been made, ally with an experienced integration partner or development team to draft objectives, timelines, and resources. Determine the key data that would be synchronized between Shopify and the ERP, such as inventory levels, order details, and customer records. A well-structured plan minimizes the risk of disruptions during implementation. 

Test the Integration

Testing is critical to ensure the integration works flawlessly before going live. Run test cases to verify that inventory syncing, order processing, and financial reporting function as expected. Perform end-to-end test orders to confirm data flows correctly between Shopify and the ERP. Address any issues discovered during testing.

Overcoming Integration Challenges

Integrating Shopify and an ERP system might be difficult, but doing so effectively will ensure that the changes transition smoothly into continued success. Here are some technical pitfalls and suggestions on how to avoid them.

Technical Complexities

Integration often involves very technical and complicated tasks (e.g., API configurations, data mapping, and system customization), which can overwhelm companies lacking technical know-how. To resolve this, you should hire experienced integration specialists or consultants with plenty of experience in Shopify and your ERP system of choice.

Middleware solutions and integration platforms like Zapier and Celigo can also greatly facilitate integration. In addition, always ensure that your integration plan involves a proper testing phase, which will help catch and fix technical problems before going live.

Resistance to New Systems by Employees

Workers may resist using an ERP due to a lack of familiarity or the impetus to change not to upset their established routines. To counter that, try to involve your team during the early part of the integration life cycle; let them know the advantages of the integration (e.g., less manual work, faster order processing). Offer thorough training tailored to their jobs, with follow-on support during the transition. It can induce positive attitudes toward the new system through free-flowing positive reinforcement feedback and proactive acknowledgment of complaints.

Concerns About Security of Data

New systems usually transfer sensitive information, creating a risk of data breaches or loss. Encryption technologies need to be developed for information safety and provide an ergonomic design. This will pave the way for the safety of ERP systems.

Choose a system and integration tools that minimally satisfy GDPR or SOC 2 requirements. Software should be continuously updated to find all loopholes, and audits should be performed regularly for security assessment purposes. Also, it is advisable to ensure that sensitive information is recorded, not open to access by all users but by a selective group of users to mitigate risks. 

Conclusion

Shopify ERP integration streamlines operations, automates workflows, and improves efficiency, enabling businesses to scale effectively. 

Syncing real-time data and enhancing inventory management eliminates manual tasks and reduces errors. 

Partnering with Elogic ensures a seamless integration process tailored to your specific needs. Elogic’s team of specialists has a proven track record of overcoming integration challenges, offering innovative solutions, and providing continuous support to help your business thrive.