What are the main advantages of retail ERP software? Ultimate guide to utilizing retail ERP
Every business depends on internally connected business processes. These include financial management, human resources and procurement, day-to-day organization of production or provision of services, and many other processes that depend on the industry specifics. The purpose of an ERP system is to efficiently combine the mentioned business processes into one single ecosystem. A well-designed ERP system helps automate routine processes and avoid multiple entries of the same information.
However, an ERP solution isn’t about just accounting, procurement and process organization. Today, modern ERP software for retail and any other field is equipped with tools that take advantage of artificial intelligence, which makes business management more transparent and efficient.
Almost two years ago, the market was valued at 94,71 billion USD. For 2022 to 2024, it’s expected to reach over 97 billion USD.
According to The 2020 ERP Report, in 2020 the top ERP consumers included the following industries:
Top ERP consumers, according to Panorama Consulting Group. By Abto Software
By 2030, as to the Grand View Research, based on an analysis of the latest trends, we can expect significant market growth in several large sub-segments, and retail is one of the most promising of those, together with manufacturing, BFSI, and healthcare.
The difference between ERP and CRM
Some people confuse ERP with CRM, or consider these solutions to be almost analogue. The difference between Enterprise Resource Planning and Customer Relationship Management lies within the application, core functionality and complexity.
Both ERP and CRM handle contacts, partners, customers, logistics, invoices, quotes, orders, and forecasts. Those are used for different purposes, a CRM is used to optimize the interaction with customers, whereas ERP is a complete package laying emphasis on accurate resource planning.
ERP business intelligence solutions:
- Create a centralized database
- Optimize management with insight from seamlessly shared information
- Break down communication barriers between departments
- Improve the network’s reliability
Areas of ERP usage. By Abto Software
In contrast, CRM software is designed to improve:
- Customer management
- Employee tracking
- Lead management
- Analytics, reporting and forecasting
When to use CRM. By Abto Software
An ERP is a pre-packaged solution that optimizes internal processes within multiple enterprise departments, including manufacturing, inventory, purchases, distribution, HR, and services. The system is enterprise-oriented and designed to reduce financial expenses.
A CRM is a software tool ensuring companies to record every interaction with the present and potential client. The system increases sales and is oriented toward customer management.
What core retail functions benefit from thought-out Enterprise Resource Planning?
Commerce
Modern retail ERP software is a multi-channel solution, which facilitates in-store and back-office processes. This way, the business can increase the productivity of each internal department and ensure business growth, while customers are getting a more personalized experience.
Finance
Well-designed retail ERP systems automate accounting, which helps direct resources more thought-out. Advanced technology can reduce the amount of work performed manually, automate various routine tasks, and help track the investment flow.
Human resources
Retail ERP solutions streamline employee management, including hiring, onboarding, payroll, and more. Simplified hunting, interviewing, hiring and onboarding, as well as employee performance monitoring lead to increased productivity.
Supply chain
Retail ERP modules include warehouse and supply chain management features. Advanced technology such as artificial intelligence, machine learning, deep learning, and other modern approaches optimize manufacturing, inventory management and logistics creating growth opportunities accordingly.
Why does retail business need ERP?
Is your retail business not running as expected? Are you currently looking for opportunities for optimization? Sure thing, the introduction of new managerial approaches and technologies requires investment. But utilizing modern approaches and implementing advanced technology might make the difference.
With ever increasing competition in the retail market, Enterprise Resource Planning systems became necessary for organizations that want to keep up with constantly changing consumer needs. ERP systems are complex, customizable applications that help to manage operational processes. For retailers, this means more control over employees, stores, warehouses, price changes, seasonal discounts, and more. Such processes are quite time consuming if not properly organized, and for retail owners this might result in financial loss.
Conventional retailers are facing stiff competition – digital retail is rapidly taking over the market. This means low margin. Online stores do not pay rent and incur lower costs for logistics and various operational processes. This way, their return on investment increases significantly.
Traditional retail-stores today cannot afford to do business the good old way resorting to paper bureaucracy. High competitiveness requires automation and optimization, which is impossible without advanced technology.
Important modules a proper retail ERP should include
Important modules of ERP for retail. By Abto Software
Inventory and purchasing management
The solution collects information about each available product to ensure regular replenishment. ERP systems also identify market trends through detailed analysis of purchasing history.
This module might include information about:
- Inventory dashboards
- Inventory valuation
- Stock moves
- Inventory adjustments
- Equipment maintenance
- Equipment breakdowns
- Procurement exceptions
- Defective products
Store and warehouse management
The software significantly optimizes product and material management, store and warehouse operations. Enterprise resource planning automates routine tasks performed by managers and warehouse workers increasing productivity and saving resources accordingly.
This module might include information about:
- Multiple stores
- Multiple warehouses
- Product prices
- Product discounts
- Product barcodes
- Serial numbers
- Payment methods
- Payment refunds
- Customer registration
- Loyalty programs
Payroll and accounting management
With access to data on each stocked product, logistics costs (freight charges, import duty), additional taxes, rental costs and wages, and other financial information, the business can obtain comprehensive understanding of margins. This way, the retailer can optimize pricing and sales strategies, loyalty programs, and understand the feasibility of additional business investments.
This module might include information about:
- Working shifts
- Tracked sessions
- Sick leaves
- Pay sheets
- Salary disbursement
- Monthly and annual reporting
Risk management
This module might provide multiple opportunities to minimize business risks:
- Demand-driven material requirement planning. Demand-driven MRP helps tracking material demand and make real-time adjustments.
- Human error. The automation of certain operational processes significantly reduces human error.
- Industry regulations. The facilitation of cooperation between departments minimizes the possibility of compliance variance.
- Insight-driven decision-making. Smart solutions aggregate important business data and provide meaningful insight.
Supply chain and distribution
This module is responsible for processes from manufacturing and distribution to the end consumer. This way, the business becomes adaptive to sudden demand changes.
ERP solutions also help manage distribution. Well-designed, reliable Enterprise Resource Planning software facilitates processes such as order processing, invoices, quotations, taxation, logistics, and more.
Advanced reporting and analytics
A modern ERP system might provide insightful reporting and analytics processing aggregated business data. The tool can help examine and compare efficiency across departments.
This module might include information about:
- Employee retention
- Warehouse statuses
- Cybersecurity statuses
- Return on Investment (ROI)
- Demand changes
- Refund rates
Main advantages of utilizing retail ERP
Main advantages of ERP in retail. By Abto Software
Cost efficiency
One reason to implement ERP for retail business is that Enterprise Resource Planning systems can optimize everyday routines and significantly reduce paperwork as well as optimize business reporting. This way, advanced technology reduces costs on repeated operational and administrative processes.
Simplified decision-making
Another reason to introduce ERP for retail industry is that reliable platforms store information collected across multiple departments, including details about the supply chain. Relying on this information, business leaders can make better decisions and refine business approaches.
Real-time data
Such an enterprise solution allows managers to interact with information more dynamically and efficiently. Centralized information allows users to access data immediately.
Customer satisfaction
Enterprise platforms help increase customer loyalty, order accuracy as well as overall purchasing experience. Gathering information such as customer feedback and demographics, product reviews, and more, helps to respond to consumer needs more efficiently and grow the existing client base.
Signs you need a custom ERP
- Difficult pricing
How long does it take to estimate the exact cost of each stocked product? If you are already getting headaches from just thinking about estimating employee working hours, material and logistics expenses, you definitely need an ERP platform.
- Inaccurate inventory
Do you find yourself wondering about why your storage space is overloaded? A reliable ERP platform can help avoid products being forgotten, defective or accidentally unscanned.
- Troublesome accounting
Do you still use countless spreadsheets for regular financial reporting? With custom-built ERP solutions, financial reporting can be done in just seconds.
- Relying on manual handoffs
Do you rely on manual handoffs when it comes to transmitting information from department to department? Modern software helps get rid of unnecessary day-to-day manual work.
- Troublesome extraction of insight
What were the costs on wages, materials, logistics and other regular expenses made over the past five years? With a proper platform, you can get that business insight in a few clicks.
- Customer complaints
Are you receiving regular customer complaints? Having a reliable platform, you can respond to customer needs and grow your current client base.
Main benefits of custom retail ERP software development
Isolated modules
Choosing custom software development, you obtain individually designed isolated modules equipped with necessary functionality matching every department’s specifics. Your employees won’t get confused with multiple features, and you won’t risk data leakage thanks to process encapsulation.
Easy-to-learn and easy-to-maintain platform
With custom platform development, you get comprehensive documentation and reliable technical support. This simplifies employee training and maintenance of the built platform.
Vital features to implement when building a custom retail ERP
Retail ERP should include:
- Integrated CRM
- Integrated POS
- Materials and inventory management
- Multi-location management
- Retail & wholesale functionality
- Vendor management
- Payroll and accounting management
- Risk management
- Order processing
- Return management
- Customer database
- Advanced reporting and analytics
How we can help
Abto Software focuses on delivering retail software solutions to match the client’s industry-specific needs. Harnessing the advances of artificial intelligence, machine learning, deep learning, computer vision, image and video processing, data science, and more, we help our partners streamline internal business processes.
Among many other things, we deliver Enterprise Resource Planning solutions for clients in the retail industry. Our custom-built ERP software helps to save costs, get a complete overview over finances, optimize inventory, store and warehouse management, and seamlessly build better customer relationships.
Abto Software’s expertise includes:
- CRM (Customer Relationship Management)
- ERP (Enterprise Resource Planning)
- ERP migration
- POS modernization
- Inventory management systems
- Production lines solutions
- Product recognition
- Data warehousing
and more!
Keep track with the latest trends and optimize all operational business processes by implementing digital retail solutions!
