ERP system for WooCommerce

We’ll help you understand what an ERP system is, why it’s necessary for your e-commerce expansion and which systems are suitable for WooCommerce.

What is an ERP system?

In Sweden, we most often use the word ERP, but internationally, the term ERP, Enterprise Resource Planning, is mainly used. An ERP system is often a modular system that facilitates administration in a company. ERP systems provide decision-makers in the company with a basis for important decisions that may otherwise be difficult and time-consuming to produce, while it is intended to collect and streamline the company’s processes for those who work in the company.

We can certainly agree that time-consuming manual processes are neither fun nor profitable. An ERP system solves this by automating flows, while allowing the company to scale up or down in size without having to sacrifice quality assurance in what you do. It simply makes it easier to run a business, regardless of size.

An ERP system often consists of several components such as:

• Integration platform
• Financial system
• Reporting tools
• Project management
• Order management (OMS)
• Product information management (PIM)
• Case management
• Document management
• Warehouse management
• Purchasing & Ordering(SCM)
• Sales support(CRM)

Many companies often have their data spread over several different smaller tools. For example, there are fantastic CRM tools that help the organisation in its sales work. Then there is no point in having a custom-built module for this. The ERP system therefore often becomes the application where all data is stored and integrated.

Why do you need an ERP system?

As a start-up company, an entire ERP system can feel extremely large and complicated. When you set up your first e-commerce in WordPress with WooCommerce, the company may be run in a garage or a student corridor. However, when the company starts to develop, the need immediately arises.

When an e-commerce starts to grow towards multiple points of sale, multiple markets and multiple languages, an ERP system is needed.

We have seen many times that doing an e-commerce project with WooCommerce provides much more value for money than doing it with other systems. It is for this reason that WooCommerce is the most popular solution for e-commerce projects among the Open-Source options.

As with so many other things, this modularity and speed means that you need to carefully consider the architecture of your solution. When it comes time to scale up an e-commerce venture, regardless of the system, you want to carefully plan your “systems puzzle” to avoid doing as much manual work as possible and instead focus on scaling the business and marketing your products.

TIP: Learn how to set requirements for your WooCommerce project and screen suppliers so that your e-commerce venture is successful and cost-effective.

By having a good solution for order management and product information, your business can cope with working either with multiple brands or having different websites aimed at different markets (so-called multi-shop solution).

With the help of the ERP system you can collect all orders in one place, with PIM you can output product images and product information in different languages in a simple way and with a CRM you can easily manage all customer data and provide effective data for your sales and marketing work.

Systems are in place for many years – choose a good supplier

An ERP system is often an investment and will therefore have a lifespan of a few years. It is therefore extremely important to spend the time needed to procure a good system that suits the business and its requirements.

Just as with an e-commerce venture, it is therefore important to make a good set of requirements for the system and ensure that the supplier has experience. A poor implementation can mean increased costs instead of reduced, and if the system is rolled out too quickly without the right training efforts, the project can easily have a belly flop.

Support will always be needed, so it’s important to know what the support hours are and if they can be reached and helped in a time crunch. If the ERP system does not work, it will of course be more difficult to do business, so the company must have good support with good response times.

If further development is needed, this is also interesting to have mapped out from the start. What can it cost to do different types of further development? Some suppliers have low prices on the ERP system and then charge extreme sums for further development. Do not fall into that trap but make sure that further development can be done for a reasonable cost.

Integration possibilities give freedom

For an organisation to function well, users need to be able to use the systems in a simple and intuitive way. This prevents errors and increases the quality of delivery. Of course, it is also extremely important that it makes it fun to work instead of frustrating.

Good UX is therefore extremely important when working with the company’s processes to be able to quickly and easily implement what you want to do.

If the ERP system has a good integration platform, it is possible to assume that users work with the standardised ERP system and then integrate with more specialised tools. This type of microservice architecture allows each part of the business to be improved separately without losing functionality.

Check that there are no strange limitations

Integration capabilities are key in an ERP system. Most ERP systems can be integrated but different systems have different thresholds. Be careful to check that there are no strange limitations.

A good ERP should be able to handle many reads and writes at a very high rate, and this is something you need to make sure of so that it can scale the business effectively. Larger systems can generally cope with very high loads as they have to handle huge amounts of transactions and orders while smaller ones can be more limited. Here it is important to understand the limitations that exist and consider whether you can live with them.

Security & availability

One thing to bear in mind is that some systems often have very high security requirements. As such, they are not open to the internet as most SaaS systems are, but require a much more complex IT environment.

The threshold for integration with a self-hosted system can therefore be considerably higher than for a SaaS system, and with this comes cost.

For companies that want to comply with certain types of ISO certifications and that hold sensitive data, using SaaS is often not an option, but the benefits can be significant for those who don’t have to worry about these limitations.

It is not always obvious that the system is accessible from all the devices you normally use. For example, Visma ERP was for a long time only accessible from Windows machines. We can agree that using a Windows desktop application from an iPad was quite a hassle.

Migration & training

One thing that is easily forgotten is the cost of migrating and importing existing business data. On the one hand, the project must be implemented, but who can implement such a project? This becomes a problem in itself to solve, and can easily be forgotten.

Another aspect that becomes important when it is time to get started with the system is what training efforts are possible to get help with from the supplier, and what costs are associated with these efforts. Bear in mind that over the lifetime of the ERP system, you will probably need to train a number of people on it. Calculate how much staff turnover you have and add that cost to the running costs of the system.

What does it cost?

Different systems have different ways of charging. It can feel like comparing apples and oranges sometimes, so ultimately it’s the total cost of the scheme that’s interesting in relation to what you get out of it. Calculating in this way makes it easier to compare different options and forms a concept – “TCO”, Total Cost of Ownership.

For self-hosted ERP systems, you often need to think about these aspects:

• What does the licence cost?
  • Per module
  • Per user

• Is it possible to switch modules and users up or down?
• What is included in the implementation cost?
• What additional services are needed?
  • Training and education
  • Migration

• What is the cost of a support contract?
• What is the cost of operations & technology management?
  • Upgrades
  • Hosting including SLA
  • Backups

• What customisation might be needed, and how much will it cost to implement?
• How much time do we have to spend on maintaining the system ourselves?

For SaaS business systems / ERP, these are almost the same things to consider, but with the big difference that the supplier is responsible for the entire technology management of the platform itself.

• What does the system cost per month?
  • Per module
  • Per user

• Is it possible to switch modules and users up or down and with what binding period?
• What is included in the implementation cost?
• What additional services are needed?
  • Training and education
  • Migration

• What does a support contract cost?
• What guarantees are there on operations & technology management?
• What customisations might be needed, and how much will it cost to implement?
• How much time do we have to spend on maintaining the system ourselves?

ERP systems with WooCommerce integration

Most major ERP systems today have ready-made integrations with WooCommerce. However, these integrations are rarely made by the supplier of the ERP system, but are created by separate companies that sell the connection as a subscription solution, SaaS (Software as a Service).

By buying the connection between the systems in this way, you avoid large investment costs in system integrations that can instead be invested in the e-commerce project.

Most suppliers also support multi-shop functionality, i.e. you can use several different e-commerce solutions and also have one or more different shops (POS) in one and the same system.

The two main solutions for the Scandinavian market are Sharespine from Gothenburg (Sweden) and Maco.io from Bergen (Norway). Together they cover most of the major ERP systems in Sweden. For the US market, there are Modern Retail and eBridge Connections which have links to systems common to the US.

Standalone integrations

Rental solutions (SaaS) are a great option in most cases, but these cannot normally be run within your own IT infrastructure. In cases where you need to run integrations in your own environment – whether because of external requirements or because of complicated customisations made – you can use these integrations:

• Specter – Krokedil
• Fortnox – Redlight Media
• Fortnox – Wetail
• Visma eEkonomi – Wetail