What is an eCommerce ERP? Does My Business Need One?

What is an ERP for eCommerce?

An ERP (Enterprise Resource Planning) is a software system initially designed to digitise manual processes and increase operational efficiency. In other words, it helps organisations increase their profits and grow faster by relying on pre-defined processes and automation.

Let's take a look at this simplified example when a client orders on Amazon:

1. Order is imported into the ERP
2. Inventory is reduced on Amazon and your website
3. Order is forwarded to shipping
4. Shipping label is created
5. Invoice is created
6. A purchase order is prepared if the inventory goes below its threshold.

This flow of events runs entirely automated. That is what a sound ERP system will do for you. Take the manual labour out of the process and ensure that every step is taken care of with great precision and speed.

Let's talk about growth / Scaling.

You see, while the company is young, things are simple. You remember your suppliers, know what items you need to purchase, and are happy to copy-paste your orders. This is all well and dandy, but the volume increases, and perhaps more people join the team as you grow.

Growth comes with challenges. As you grow, your team may not do things uniformly or forget to communicate. This leads to unshipped orders, double-shipped orders, poor customer service response rates, stock-outs, and more.

Once the habits set in, it's hard to change them. So, instead of trying to figure things out and learn from your mistakes, you can simply use a purpose-built ERP platform (e.g. OneSila) where the correct, battle-tested processes have already been implemented. Introducing such a platform early on ensures that you keep growing in a cash-efficient way and continue to deliver a high-quality service to your customers, ultimately leading to high repeat purchases, lower returns and great reviews.

Why do you rely on processes?

No need to reinvent the wheel, right?

It's seen a lot: Today, you do things one way, tomorrow, another. Perhaps you like this, but in reality, it's most likely stopping you from reaching the next level.

The thing is, if you need to reinvent the wheel every time, you're not only bound to make mistakes, but you're also making it impossible for someone to replace you. Now, if you want to reach the next stage in the growth of the business, then systemising your operations is the go-to step.

After all, we all need a holiday and may want to hire a team to grow. The processes will ultimately help you find team members more easily and reduce training.

Combine the processes with the automation that eCommerce ERP systems can provide. You'll find that you can grow businesses faster than hiring team members.

Flexibility in strategy

The products and channels you use today may be different from tomorrow, especially as a growing business.

That's a big consideration when choosing an ERP. The platform must be ridged enough to support extraordinary processes out of the box and promote operational efficiency.

However, it must also give you the right flexibility in the right places. Maybe your next move is to go global. Or you want to sell B2B - or maybe tomorrow you decide that you're offering bundles. The right system will support you and enable you to move fast.

On the other hand, you may need multiple shipping locations, end up with multiple suppliers for a given product, or see your product range explode in size.

The right solution should support you through these transitions and help you to grow.

How does an ERP make you money?

The short and sweet is that ERP makes money by reducing time lost and fundamentally decreasing human error.

How does that work? Through automation, your team can handle more orders than ever before. That saves money in time, not spend.

What else? It allows you to increase revenue disproportionally to your team size, which means lower overheads per order.

Thirdly, by removing human error, you improve your reputation, reduce time lost, and ultimately gain repeat extra business.

So, ERP investments have a strong ROI in short-term cash and long-term brand equity and other intangible benefits.

Why you need an ERP?

To summarise, the 3 main reasons to invest in an ERP are:

• Increasing net profits by reducing overheads.
• Foundation for growth
• Supportive of your sales-strategy, locally or globally.

A sound ERP system with an organisation that supports you well is one of the best investments you'll ever make.