Why Does my Small Business Need an ERP System?

March 07, 2023

This is a question that is often asked by small business owners. It is a common perception that ERP software is ‘too big’ for their needs and business owners don’t think they would get the use out of it to justify the investment. Generally, they have been managing just fine with their entry level accounts package, such as Xero or QuickBooks, backed up with Excel. That is until those systems don’t work for them anymore. When their business has grown to reach a certain quantity of orders, small business owners may find their original systems are holding them back, and causing more problems than they were intended to solve.

Problems Caused by Systems That Are No Longer Fit for Purpose

Increasing manual administration, and duplication of data and effort, are problems that many companies face, particularly when their systems don’t communication with each other. This means that information needs to be duplicated between systems, which is time consuming and inefficient. Entering data into more than one system also increases the potential for human error – after all, how often have you typed a number incorrectly or put a decimal place where it wasn’t required?

Reporting Issues

Companies tend to rely on Excel to fill in the gaps and for reporting purposes, but it is difficult to gain an accurate insight into the state of the business at any given time if information has to be manually entered. Reports are only accurate at the time the information was entered, which isn’t reliable enough to use to support strategic business decisions.

Difficulty Managing Stock Levels

Inefficient stock management has a negative impact on profitability. Without an effective system in place, knowing where items are located can be challenging for staff, which may cause delays in the production process or fulfilling orders. Overstocking or stock-outs are also an issue, resulting in unnecessary overheads being tied up in stock, or blockages in the production process and inability to fulfil orders as quickly as customers expect. In the modern world, where customers expect their orders tomorrow (or as soon as possible), delays can result in reduced customer loyalty and lead to them looking elsewhere to buy the products you’re selling. It goes without saying that no business wants to lose customers, but inefficient stock management can lead to this further down the line. There will always be competitors in the background waiting to fulfil the orders that you can’t.

IT Security

IT security should be of paramount importance to all companies but keeping up with the pace of technological change can be a challenge, especially if IT is not your natural ‘area of expertise’ and it takes you away from your regular day job of managing your business, which is all-consuming. Every week, we see stories in the news of companies that have been the victims of malware and ransomware attacks, have had their systems hacked and data stolen. These companies tend to have a high enough profile to make the news, and these attacks cost them dearly – but these are the very companies that, due to their scale, should have systems in place that prevent such attacks.

Now let’s look at this scenario from the point of view of a small business. Your days are filled doing what you do best; everyone has their job and probably some other areas of responsibility too. Your servers are a few years old, and the receptionist takes a back-up every evening, or the responsibility for managing the servers is given to one of your employees who used to be quite good with computers at school. You don’t have an internal IT expert, but you outsource your support to a local company, which works fine for you – until you have a problem. This situation is common amongst small businesses, but it leaves them vulnerable to an attack. But an attack, which disables a large business could spell the end of a small one. That makes it essential to put measures in place to increase your IT security and prevent future potential attacks that could severely damage your business - if it even survives.

How can an ERP Solution Help?

ERP solutions, particularly if they are cloud-based, can help resolve these issues. They can automate repetitive processes and help eliminate manual administration and duplication of effort, increasing efficiency while providing a real-time overview of the state of your business. You will have the detailed insight you need to support strategic decisions at your fingertips and the efficiencies gained will support cashflow and help your business to scale.

Accessing your ERP solution via the cloud has many advantages, particularly if your business lacks in-house technical expertise. Cloud-hosted solutions are extremely secure, which provides protection from the threat of attack, while removing the risk of failure of on-premise servers and the associated overheads that come with maintaining an on-premise hardware set-up. It also enables you to predict cashflow more effectively as cloud-based systems tend to be paid for on a subscription basis, making them an operational rather than capital expense.

How can SAP Business One and Ascarii Help?

SAP Business One is an ERP solution designed for small businesses and Ascarii specialises in providing cloud-based SAP Business One to SMEs. We have many years’ experience working alongside small businesses to help them achieve their objectives and scale their business, with SAP Business One as the foundation of their growth. Our experience spans all industries and our highly-skilled and qualified consultants are used to working with our customers to help them achieve solutions to their business pains. SAP Business One is a solution that will streamline and automate processes across your business, reducing manual administration and repetitive data entry, and providing detailed insight into the state of your business.

We use Amazon Web Services for our purpose-built platform to host SAP Business One, providing customers with the assurance that their data is held on the world’s leading cloud platform with extremely high security and resilience that comes with that.

To find out more about how our friendly team can work alongside you to help eliminate your business pains and guide you through the process of implementing SAP Business One to help support your business to scale, please don’t hesitate to contact us.

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