The 10 Reasons For Small Businesses To Invest in ERP System
- Saudi ERP & Website Solution Blog September 21,2023
The word investment leads to immediately think the cost-benefit ratio. First rising cost and then analyze the benefits. If the cost is high, companies often do not make the analysis of the benefits.
In this context, the usual alternative for small businesses in relation to an Small Businesses For ERP System is usually the good old spreadsheets.
The cost of an ERP system is high and the benefits are not always quantifiable exactly. The cost of the sheet is almost zero, so compare with the cost of ERP discourages analysis of the benefits. For this reason many small businesses give up investing in ERP without even lifting the benefits.
But if a small business has condition to honor the investment adjusting to its cash flow, it is worth raising the benefits and see the returns that this decision could bring. See the main benefits that the ERP system can bring to your business:
10 Reason Why Small Businesses Need to Invest in ERP System
1 - Centralized Control
Everything in the universe has a center in both the solar system as in atoms. Multiple centers lead to disorganization. The company should also have a control center. The ERP centralizes information from all processes and different departments in a single database.
2 - Avoid Operating Calamity Situation
The increase in the volume of transactions and the intensive use of spreadsheets leads to the total lack of control and to the operating state of collapse. The end result may be the closure of the company.
3 - Cost of Spreadsheets
What is the cost of using the spreadsheet and its limitations? The answer is the cost of labor spent having to enter the same information in two or more places.
Rework cost due to errors caused by lack and delay information. The elimination of these costs is one of the great benefits of using an ERP system.
4 - Wider The Company Overview
The integrated management system gives the manager an overview of the company in one place because it eliminates the various spreadsheets, one for each task or department. Can readily show the most important information for making decisions and planning.
5 - Pour in Proceedings
In the manual process, a sale is posted in customer sheet. Launches low on inventory control spreadsheet and updates the balance of the stock. Then updates the financial spreadsheet, and so on. The ERP system does all these operations automatically and synchronously, giving fluidity to processes, eliminating waste of time, manpower and material.
6 - Increase Sales
For control via spreadsheets, the budget is released but is not checked if they had the confirmation of receipt, it had return, etc., which leads to forgetfulness and loss of sale. ERP in there automatic verification mechanism to prevent this from happening. The system sends daily report of the proposals, their situation and measures to be taken.
7 - Improves Management
Imagine a sale chaining the issuance of invoice, the packing list for the separation of the product and dispatch, low in stock, check the minimum inventory, generates a purchase order updates the financial system to control spending and receipts . This allows control spending, plan tasks, control the schedule and so on.
8 - Higher Flexibility
The great advantage of small businesses is the agility and flexibility to adapt to the market needs or conditions imposed by buyers. When choosing an ERP it is necessary to look for software on which to make the necessary adjustments to maintain business flexibility.
9 - Long-Term Planning
ERP is a long term investment. The system provider will be your partner for a long time. Look for a vendor that has tradition, experience, structure and quality support to users. Select the system that will provide the best value for money through the system usage time.
10 - Technological Obsolescence
For the system is not obsolete and the investment is not lost in the short term, the software needs to be updated constantly to keep up with technological change. If not, soon you will be with a dinosaur in his hands.
How to Choose Best Open Source ERP Software for your Small Business
Anyway, not all small businesses need all the modules that make up the ERP package. In this context it is interesting to find solutions deployed modularly according to the need and added as business growth.
Besides reducing the initial investment, this will facilitate the implementation of an ERP system on small business, starting a new organizational culture.