5 Reasons Growing Retailers Need to Invest in ERP
Today, ERP systems integrate into all functional areas within an organization, with the primary purpose being to help the experienced managers better understand the evolution in daily operations, identify opportunities, and make more informed decisions that will directly create an impact on the future success and viability of their retail businesses.
Despite the use of the word “enterprise” in the name, ERP systems are used by businesses of all sizes. There are two primary types of ERP systems being implemented at organizations today, On-Premises and Cloud-Based.
ERP systems integrate all essential parameters required to run an enterprise into one comprehensive information system. Employees in planning and scheduling, for example, have access to the same data as the staff in financial management for their specific needs.
Which retailer does not want all the real-time data to make faster and informed business decisions?
With ERP systems, all vital business functions — estimating, production, finance, inventory, sales, purchasing, human resources, marketing, — share a central source of providing the owner the required information at any given time. Enterprise resource planning systems streamline the collection, storage, and use of your organization’s data.
Every business is unique and faces different challenges at different times, so the question is, how do you decide if and when investing in Enterprise Resource Planning is right for your business?
If you’re able to check off most of the items on this list, it’s probably safe to start evaluating ERP software providers and working to allocate the resources needed for deployment:
1. You don’t have easy access to the data you need to make informed decisions about your business.
Businesses make money by conducting sales and without access to data to increase sales, no business can survive. Data analysis is linked to many factors, including economic trends and market awareness and company management must always look to procure real-time data for the business to grow.
While a guaranteed sale may not be possible, retail business owners must carefully acquire knowledge about market trends and customer preferences. By studying the market and by bringing about necessary adjustments in strategy, a retail business can be responsive, and this can help of data gained through a structured ERP system.
2. You don’t know what your inventory levels really look like in real-time.
To capture and expand your retail enterprise, business owners must ensure that they are adequately prepared to meet logistic challenges, financing concerns, and supply chain management. Specifically, if you know your inventory in real-time, you can capture a larger market and stay afloat.
Lack of proper experience and failure of logistics + supply chain management is one of the prime reasons why retail businesses fail. Business owners must ensure that they spot and effectively address any inventory management problems before they go out of hand.
3. You can’t access essential business data, manage cash flow and bank reconciliation.
As with all types of businesses, retail businesses require a good amount of capital, both to start off the venture, as well as to sustain operations. Even after commencing, many retail businesses soon reach a stage where they require additional funds to continue operating.
Business owners must always ensure that they have proper access to data and seamless cash flow operations to secure financing well before the business needs it. The integration of an ERP along with inbuilt bank reconciliation feature can be the determining factor between a successful venture and insolvency.
4. You have trouble keeping up with changes in regulatory compliance.
Of the many reasons why growing retail businesses fail, problems with regulatory compliance are one reason, which is completely the retail business owner’s responsibility. While a retail business may have been started off by an entrepreneur, it is important to effectively manage the compliance issues.
5. Missing customer preference recording and using it to engage customers
Whatever business a company may be in, it needs to be able to address customer problems. Customer problems may range from customers not paying up on time, to customers being unhappy with the products or services they purchase.
While there is no guaranteed way of keeping customers happy, retailers must look to be quick in responding to customer concerns and must always maintain clear communication with customers. Conducting special events to engage customer relationships either in-store or online is a great way to keep an interaction going. Furthermore, it comes easy for customers to recall your brand with a suitable preference. The purchase will therefore end up being satisfactory and delightful rather than the whole experience being a dissonance one.
While these reasons range from external economic factors to problems within a company, the big takeaway is that all these problems can be avoided by careful planning and preparedness to meet different scenarios with the easy implementation of ERP. Achieving short-term success in retail may come to many, but in order to make a thriving business that flourishes in the long term, it is necessary for business owners to change with the changing times and accept the advancement of technology to their advantage.
December 9th, 2020