Retail ERP 101: Exploring Key Features, Your Own Needs & Top Vendors

Searching for a retail ERP that offers an all-in-one solution to handle your retail business's purchasing, shipping, fulfilment, inventory, warehousing, accounting, and other vital processes? Do you need help determining which solution suits your business's needs?

Let us help you explore and understand important retail ERP features, as well as the best-in-class ERPs available for the retail market.

toc-blogpost

What Is A Retail ERP?

1. What is the difference between these traditional ERPs and retail ERPs?

We talked about Enterprise Resource Planning (ERP) systems and described the roles of their modules in business operations. Here, let’s make it simple: retail ERPs are built with a similar foundation to how an ERP works - centralising data via a single source of truth, but with features that focus more on the retail operations.

2. How does a retail ERP help businesses?

Specifically, the retail ERP integrates data from diverse functions in your retail business, from sales, marketing, and customer relationships, to inventory, purchase and finance. With a unified system, the ERP establishes a smooth data flow and real-time visibility within your business, providing you with a better way to make decisions, cut costs, and improve customer experience.

The global retailers' ERP market is projected to grow at a CAGR of 9.9% by 2032, reaching USD 24.8 billion from its 2022 valuation of USD 9.65 billion (Business Research Insights). One of the most compelling reasons for the growth is that ERP has proven its success in optimising key operations of a retail business. Accordingly, nearly half of businesses (respondents) use ERP to enhance their supply chain, cutting down the cost of inventory control and order fulfilment optimisation.

Read more: 4 Common Technologies of AI in ERP and Best Practices to Begin

For Starters: 6 Must-Have Features Of Retail ERPs

Retail ERPs can be tailored to different business models, IT resources and strategies. Nonetheless, in general, the following features are essential for retail businesses:

3 Steps To Clarify Your Demands For ERPs

It's important to have a thorough grasp of your business requirements before selecting a retail ERP. We will show you a 3-step roadmap so that you can easily identify the most important features of your own business:

Step 1: Understand your retail industry & product complexity

Let’s take a step back and evaluate your entire retail operations’ performance to get a clear picture of your current state and future needs. Think about these critical aspects:

• Business size & growth plans: Do you operate as a major national shop, a small, entrepreneur, or a mid-sized local chain? The ERP's scalability will depend on your development goals.
• Retail model: Do you run digital stores, physical stores, or a combination of both? An ERP must have great multi-channel selling capabilities to manage an omnichannel model - both digital and physical channels together.
• Industry & product complexity: Your business needs vary based on your particular retail sector. For grocery stores, robust perishables management is essential. However, for clothing stores, size and colour variant tracking in inventory systems become the priorities.
• Current workflows: Outline your current processes to handle sales, inventory, and customer relationships. Addressing inefficiencies in these processes will help you determine which functions or areas where an ERP can improve efficiency.
• Current systems: Are you currently using different applications for CRM, inventory control, or finance? Keep in mind that the new ERP must integrate seamlessly with your current systems and consider if data migration is required.
• Budget & resources: Get precise quotes for the ERP's initial, implementation, and regular maintenance costs. Then you can figure out the the resources needed for user training and adaptation.

Step 2: Identifying your current pain points

To select the best features of a retail ERP that align with your operations, the most important action to take is identifying your operational difficulties - the bottlenecks. Here are six typical problems that our previous clients encountered:

Step 3: Defining your goals for an ERP

After addressing the bottlenecks, define your goals after using a retail ERP. The following are examples of major goals that an ERP can help you to achieve:

6 Retail ERP Vendors To Keep In Mind

1. Microsoft Dynamics 365

For some of the most well-known brands in retail, Microsoft Dynamics 365 is the ERP of preference among enterprises and large retailers. Due to the growing significance of customer experience and satisfaction in the industry, Microsoft's integrated platform proves its ability to efficiently serve as a retailer's front and back offices.

Best for: Large retailers.

Key features:

• Omnichannel management
• Inventory management
• Sales and customer service
• Financial management
• Marketing and loyalty programs
• Business intelligence and analytics
• Microsoft products integration (Office 365, Power BI, Azure, etc.)

2. Oracle NetSuite

Large and expanding retail businesses benefit greatly from Oracle ERP Cloud. This solution integrates a set of robust features, which includes enterprise performance management, supply chain, finance, stock & SKU management, and more.

Best for: Small to medium-sized businesses; large retailers.

Key features: 

• Multiple warehouses and inventory management
• Order management and point of sale (POS) system
• Customer relationship management
• Financial management
• E-commerce applications integration

Read more: Top 5 ERP Software For Small Businesses In Australia

3. SAP ERP

SAP Business One is a feature-rich ERP system designed specifically for businesses of all sizes. It offers a variety of features that cater to different retail management requirements, such as procurement and sales, inventory control, customer and financial management, and beyond.

Best for: Small to medium-sized businesses.

Key features:

• Purchasing and inventory control
• Sales and customer management
• Financial management
• Business intelligence

4. Odoo For Retail

With Odoo - the leading open-source ERP in the market, retailers can manage from purchasing, inventory, accounting, and sales, to marketing all from a single source of truth. Apart from enterprise and mid-size companies, Odoo’s modular structure and flexible pricing plans also fit well even with startups, entrepreneurs, or growing businesses. 

Best for: Small to medium-sized businesses; large retailers.

Key features: 

• Purchase management
• Stock management
• Sales and point-of-sale management
• Financial management
• Production management
• Marketing and e-commerce

5. Infor CloudSuite Retail

Infor CloudSuite Retail is a robust cloud ERP system with machine learning tools for retail management. This solution helps retailers to optimise diverse retailing aspects, from supply chain management, labour, and assortments, to inventory.

Best for: Small to medium-sized businesses.

Key features: 

• Demand management
• Infor Nexus for supply chain management
• Infor WMS for warehouse management
• Infor Financials and Supply Management
• Infor PLM (product life cycle) for fashion

Read more: Cloud-Based ERPs - Explaining Terms, Components, & Pricing Structure

Custom Your Retail ERP Workflows With Havi

In a nutshell, a retail ERP is like the recipe for operational efficiency, higher productivity, and a better bottom line. 

If you agree to at least 60% of our listed pain points and ERP goals above, it’s time to sort out the right solution for your retail operations. Please keep in mind that what we have provided is only halfway through this ERP implementation journey. In case you need expert assistance, let our ERP experts help analyse your processes, select the best ERP, and start the implementation without any hurdles.

Retail ERP 101 - Frequently Asked Questions

1. What is an ERP in retail?

Though constructed on a similar foundation to a general Enterprise Resource Planning (ERP) system - integrating data with a centralised platform, retail ERPs are designed with features that focus mainly on retail operations. In particular, a retail ERP connects your key retail activities such as inventory, purchasing, orders, finance, and customer relationship management. 

2. What are the 3 common types of ERP?

3 key types of ERP systems are on-premises, cloud-based, and hybrid. Whereas cloud ERP runs on a remote server owned by a third party, an on-premises (or traditional) ERP is operated locally on a company's servers. Learn details from the basics: The Complete Guide Of ERP Companies' Ecosystem.

3. What is the difference between retail ERP and traditional ERP?

The differences lie in the core features of these solutions. A traditional (or general) ERP is built upon integrating all key processes of a business from HRM, Marketing, and Accounting, to Inventory, Manufacturing, and more. Meanwhile, a retail ERP has specific features that mainly resolve retail operations challenges such as order management, multi-channel selling, supply chain, customer service, and more.

4. What is the best ERP for retail businesses?

Top 5 ERP systems that any retailer should consider:

• Microsoft Dynamics 365
• Oracle NetSuite
• Odoo Retail
• SAP ERP
• Infor CloudSuite Retail.

References:

• Business Research Insights (2024). ERP for Retailers Market Size, Share, Growth, and Industry Analysis by Type (On-premise, Cloud), by Application (Large Retailers, Small & Medium Retailers), Regional Insights, and Forecast To 2032
• SelectHub (2024). ERP Buyer’s Profile for Growing Companies. Gabriel Gheorghiu.