Ecommerce ERP: What Is It?


You have one goal, whether you are a business-to-business (B2B), direct-to-consumer(D2C), eCommerce retailer, or business-to-business (B2B), that is to grow your business. As your business grows, so does your operation's complexity. While QuickBooks is used to manage your accounting, Salesforce could manage your customer relationship management (CRM), and SkuVault could manage your inventory management. However, your business now requires more than these siloed solutions.

eCommerce ERP (Enterprise Resource Planning) allows seamless integration between your eCommerce system and a cloud-based ERP solution. They connect your processes and procedures to create a seamless, future-proofed operation that extends your organization's reach and depth.

The basics of ERP and eCommerce Integration

First, let's talk about eCommerce logistics. This includes fulfilling orders, processing payments, handling returns, and managing inventory. It also involves ensuring security, tracking financials, and providing customer support. These tasks become more challenging to work on when your small business (perhaps one you started in your garage) becomes more extensive with multiple employees, a shipping fleet, and a warehouse.

Relying on systems built by hand and made to work through sheer willpower and determination will not work. A lack of consistency, data, and control will affect everyone. You can easily integrate your eCommerce software with a modern ERP to automate your processes and procedures, thereby becoming more efficient and avoiding future data problems.

There are several ways to integrate ERP with modern eCommerce solutions. You can use the eCommerce solution's API on your own. This allows you to customize the integration and makes it entirely up to you to manage. You can use a third-party solution that has a pre-built integration. This is relatively simple, and you can use it "out of the box." However, if you require customization, you must pay and rely on third-party teams without guaranteeing you'll get the desired results.

You can use an ERP system that has a native eCommerce integration. A native integration ERP, such as Ariion ERP Connector, is undoubtedly the best and most future-proof. The ERP company creates the native integration to the eCommerce platform. They expose as much ERP data as the API will allow. The integration can adapt to market changes and "crazy" business situations, as they will.

What ERP Features Are Important for Ecommerce Businesses

You should include essential features in your ERP search criteria if your eCommerce business wants to integrate its eCommerce platform with an ERP system.

1. Finance.

Although QuickBooks can manage your general ledger, accounts payable (AP), or accounts receivables (AR), a cloud ERP solution will allow you to handle these tasks and provide real-time updates for eCommerce. When an eCommerce site sale is entered into your ERP system, it instantly shows up in your sales order and is populated in your financial statements. Once the payment is processed, it becomes revenue.

Important to remember that bank loans and venture capital of large amounts are not usually granted to fast-growing companies using Quickbooks small business accounting software. They are aware that QuickBooks exports can be modified. An ERP system ensures that documentation is firmly in place and is accurate to 100%.

An ERP system also audits your finances and inventory. It can also monitor your customers, including relationships and sales. The eCommerce system can be integrated with ERP to become an extension of the auditing system.

2. CRM.

Integration of CRM with ERP and eCommerce solutions is a win-win situation. Why?

A successful eCommerce business must effectively manage contacts, leads, opportunities, customer accounts, and customers. It also needs to have the ability to track what happens during each stage of the sales cycle. A seamlessly integrated CRM system is essential to give every department instant access to synchronized, real-time data from one source.

You can quickly build a customer base within the integrated solutions to reach your customers with offers like sales, discounts, and special promotions. These promotions are created inside the eCommerce platform. The ERP system understands what it is receiving and creates a record for reporting.

The integration of eCommerce ERP and CRM creates an omnichannel commerce environment. Your centralized CRM will assign each order to the right customer, regardless of how they purchase your product. It gives you a 360-degree view of your customer's interactions with you in the past and present.

3. Inventory management.

Tracking inventory is more difficult when the business is growing. It is essential to know the location of your products. Customers also want to see if they are in stock. A fully integrated ERP system is smart enough to share this information with everyone. The integrated ERP solution provides real-time, accurate access to inventory available, regardless of whether it is in a warehouse or split between warehouses. It also allows you to view inventory costs and reorder quantities.

Logging into multiple systems to find an answer is no longer necessary. The process is automated, and manual errors can be reduced or eliminated.

4. Distribution, shipping, and warehouse management.

An integrated ecommerce ERP solution, like inventory management, is the best and most efficient way to manage your shipping, distribution, and warehouse management.

Distribution is complex. It involves wave and batch picking, packaging, receiving, receiving, and transferring. These tasks can be automated with ERP. Warehouse workers can use tablets or phones to complete their studies. The lot and serial number tracking eliminate errors, and third-party EDI software handles EDI compliance.

5. Management of product information.

Centralizing product information in an eCommerce ERP solution is essential, as customers may sell products in many different ways. This information can include pricing for your products, customer-specific pricing, and options related to your product. You can push this information to multiple locations by storing all your info in one place.

You have a content management platform. It allows you to differentiate between different audiences and disseminate information to each one.

Top Benefits of Integrating your Ecommerce and ERP

You will enjoy many benefits by choosing an ERP solution based on these features, such as better pricing, process visibility, improved productivity, and access to valuable data.

1. Better online experiences.

Customers will have a better online experience if they are engaged in a more personal way. The ERP solution can manage your fulfillment, notify customers when the manufacturing process starts when the product has been packed up, and when it is shipping out.

2. Pricing Management

Pricing management is similar to product information management. It allows you to manage product pricing in ERP. Your response can be customized to suit different customers. You can, for example, customize your answer to other customers in B2B. If customer number one has negotiated rates and customer number two (a new customer) has not, the information can be sent to the ecommerce platform. It is also possible to determine which customers have access to your product. For example, customer one has full access while customer two has only 80%.

3. Access to valuable data

Access is a keyword. You can access valuable data stored on your eCommerce site as customers interact with you. This data can be used to forecast and provide actionable reports.

4. Visibility of the process.

This allows for process visibility. You can create reports showing your company's performance, sales returns, inventory, and inventory. You can also see who is doing it and evaluate your company's profitability.

5. Productivity increases

The ERP system is the central record system and can be used by all employees to increase productivity. Automating their tasks can increase productivity by tracking inventory deductions at fulfillment and generating an automated process to submit a purchase order request.

When and why to use ERP in ecommerce.

Online shops that are overgrowing reach a point where they must ask themselves if all processes are working efficiently. This can lead to significant financial and temporal resource loss. Due to a lack of communication between departments, certain activities are done twice, which doesn't add value despite all the effort. The following are the most problematic areas for companies:

  • You must enter data manually
  • If data is not current, it must be obtained from other departments.
  • Inefficient interdepartmental workflows
  • Reports are not optimized
  • It can be challenging to keep track of important KPIs

Inadequate data can lead to mistakes that go unnoticed. An ERP system allows keeping track of other developments to be able to react in real-time. This is similar to controlling your car's engine while driving and deciding in real-time whether you want to stop at a side road or bring it to a garage. An e-commerce company can make managerial decisions by looking at the entire online store. This information is accessible to decision-makers via the enterprise resource planning system.

Should ecommerce companies use ERP systems for their business?

This question is not easy to answer, as is often the case. Each company will have to make a decision. An ERP system can streamline many processes, especially online commerce. However, one thing is sure: An example of its effectiveness in e-commerce will show you how it works.

Imagine that you are selling footballs. An ERP system stores all data regarding a customer who makes a purchase via your online store and records it in an extensive database. The system also checks for the availability of the ball. The product is then virtually placed aside after confirmation. The shipping address, packing note, and shipping label are also sent in real time and without manual effort. The inventory is also reduced, and the system informs production that more goods are needed. An ERP system is essential for multichannel retailers, especially Omni- and multichannel. This increases the complexity of these processes, making them even more critical.

This simple example shows the potential benefits of an ERP system for e-commerce. Although this doesn't mean every online store should have an ERP system, Zapier and other automation tools are available. It is often a viable solution for online shops.

Integration of e-commerce systems with ERP systems

Online shops often need an ERP system with a connection or integration for their store system. This could be Shopify or Magento, or Plentymarkets. It is essential to distinguish between integration and harmony. These terms are often used interchangeably. Because integration is more extensive than a connection, this has both benefits and disadvantages.

A comparison can help you better grasp the concept. This comparison shows integration as having a roommate in an apartment. They share your living room, kitchen, and bathroom. If you see each other nearly every day, then you may be able to benefit from joint shopping and sharing the rent. This cohabitation can cause friction. You may have different ideas about how to clean your apartment. Or you might prefer quiet in the morning while the other person enjoys more quiet time in the evening. This is why you need to pay more attention to the person you live with when you move in.

A connection is similar to outside help. A cleaner might be called in to assist with specific tasks. This creates less conflict, and cleaners don't have to be adapted to your personality. He does the work, then he leaves. This simple, uncomplicated approach doesn't allow you to enjoy a close relationship with your roommate.

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An Ecommerce ERP solution may be the best option for eCommerce businesses looking to expand. Your eCommerce system can seamlessly integrate with a cloud-based ERP solution, allowing you to connect all your data and processes. This will enable you to create a profitable, efficient business.

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