Picture this: mountains of orders piling up in warehouses, frequent picking errors by human workers, and frustrated customers complaining about delayed deliveries. For small and medium businesses (SMBs), this scenario represents a nightmare. However, an efficient Enterprise Resource Planning (ERP) system acts like an experienced commander, integrating various operational processes and simplifying complexity to help businesses stand out in competitive markets.
For years, ERP systems were primarily viewed as "back-office" solutions focused on financial integration. But for SMBs, their value extends far beyond accounting. These systems serve as the central nervous system of business operations, connecting critical functions like procurement, product data, accounting, and general ledger into a cohesive, efficient whole.
The Cloud ERP Revolution
While newer software domains like digital experience management and human capital management have gained attention, ERP remains essential for SMBs managing warehouse operations, supply chain analysis, and order fulfillment. For these businesses, ERP systems integrated with warehouse management (WMS) or other supply chain processes form their operational lifeline.
Following the lead of larger enterprises, growing numbers of SMBs are transitioning to cloud ERP solutions. According to IDC's 2020 research, cloud ERP accounted for 26.4% of all ERP implementations in 2019, with projections suggesting this will rise to 48.4% by 2024. Kevin Beasley, CIO at ERP provider VAI, notes that while interest in cloud ERP has existed for years, it has reached unprecedented levels recently.
Mobile Solutions Transforming Warehouse Operations
Ethical Products, a New Jersey-based pet supplies provider, exemplifies how digital transformation can revolutionize warehouse operations. The company uses VAI's on-premise ERP solution to manage orders, procurement, inventory, and business intelligence. However, their most significant operational improvement came in 2017 with the development of a mobile application that accelerated picking, packing, and shipping processes.
The Android-based warehouse app integrates seamlessly with their ERP system, guiding pickers through orders with scan verification and one-tap shipping label printing. Combined with physical improvements like motorized conveyors and push-back shelving, the solution allowed the company to handle rapidly growing sales without increasing warehouse staff.
"The mobile app and other improvements dramatically improved efficiency," said Frank Lucente, VP of Operations at Ethical Products. "We've experienced rapid sales growth in recent years, yet we've maintained operations with the same warehouse staff count."
The timing proved fortuitous, as pandemic-driven growth in pet ownership created surging e-commerce demand. Lucente credits the mobile solution with enabling the company to scale effectively during this critical period.
Comprehensive Cloud Solutions
While cloud adoption grows, functionality remains paramount for SMBs. Gavin Davidson, Senior Director of Product Management at Oracle NetSuite, emphasizes that integrated WMS, manufacturing controls, e-commerce software, CRM, and business intelligence capabilities are now considered essential ERP components for many SMBs.
"NetSuite provides an integrated suite offering real-time data for business analysis," Davidson explained. "This breadth of functionality delivers visibility into operations, highlighting both successes and potential issues."
Davidson notes that integrated WMS eliminates the need for best-of-breed solutions while ensuring ERP context informs warehouse decisions. "ERP provides background on vendor performance or historical customer relationships," he said. "This context enhances fulfillment execution."
The Future of ERP for SMBs
Modern ERP solutions must balance robust cloud options with integrated supply chain functionality. Doug Johnson, VP of Product Management at Acumatica, observes that SMBs seek consolidated solutions to avoid integration costs across multiple vendors.
"They want key applications unified under one consistent interface running on a single database," Johnson said. Acumatica's distribution-focused ERP version includes WMS and supports omnichannel fulfillment through integrated B2B e-commerce portals.
Ultimately, SMBs require systems that enforce operational best practices rather than simply serving as back-office tools. Scott Deakins, COO at ERP provider Deacom, identifies three critical needs: simplicity, low total cost of ownership, and error prevention to enhance profitability.
"Integrated ERP with WMS and quality control features provides the process controls that prevent costly mistakes," Deakins said. "For growing businesses, building this level of operational rigor into their systems makes the difference between smooth scaling and expensive errors."