1 min read
25 May 2021

Enterprise Resource Planning (ERP) has taken the world by storm. More organizations in India are adopting ERP to improve their productivity and ROI.

ERP is a software that integrates various functions across different business units onto one platform. The ERP system provides a shared database where all the data is available within seconds and it facilitates quick decision making. The benefits of usage of ERP solutions to the business include:

  • Increased operational efficiency and transparency
  • Reduced idle inventory
  • Decreased overall costs
  • Increased customer satisfaction

Tips To Choose The Right ERP Solution For Your Business

1. Integration of Software of Different Processes

The essence of ERP is to integrate software of various processes on a single platform, to improve the efficiency of the business operations. Some of these processes are:

  • Inventory management
  • Accounts and finance management
  • Human resource management
  • Tender management
  • Production and shop floor planning
  • Supplier management
  • Sales and logistics management
  • Budget planning

Find out what your objectives are and which software you wish to integrate to filter down your choices for the ERP software.

Additional Read: Benefits of MSME loan

2. Vendor and Software Evaluation

Another way of understanding the products before adding them to your wish list is the live demos of these software on the web. You can read the various reviews and case studies, and seek recommendations.

When evaluating the vendors, you can ask them for references to gauge their experience. It is important for you to know how they have implemented the ERP solutions and whether their clients are satisfied. Their challenges and learnings add to their expertise.

3. Cost Comparison

Cost is another important consideration before zero-in on the ERP solution. TechZone gave an estimation of the cost of ERP system for several industries with 50 users over 5 locations. For manufacturing and service industry, the costs can range from Rs. 2.5 lakh to Rs. 15 lakh. For real estate developers, the costs can reach Rs. 20 lakh. These costs are mere indications, and the real costs will vary as per the industry and level of automation. A business loan can help you obtain the funds for an ERP solution that best fits your business.

Here are the prices of some ERP software to understand the costs. Online ERP solutions available on the cloud are much economical as they don't involve investment in servers. For example, Reach ERP price starts at Rs. 6000 with 20% annual renewals. The price of ERP solution SAGE starts from Rs. 1.2 lakh and has 100% annual renewals costs, plus investment in servers and LAN. The price of Microsoft Dynamics starts with Rs. 50,000/- per year per user with 100% annual renewals.

The training and the hardware costs are additional. The software with real-time data management will be costlier, but getting business finance can offset these costs easily.

Additional Read: What is GST?

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