What Is Odoo ERP Software? Key Insights You Need To Know

What is Odoo ERP software? Odoo ERP is an open-source, modular business management software that meets the needs of businesses across sectors. Initially starting as TinyERP in 2005, Odoo has come a long way to become a globally reliable solution for businesses with over 12 million users.

In this blog, we’ll talk about how Odoo has developed, its main features, and why more companies in Australia have decided to adopt Odoo. Whether you are entering the ERP ecosystem for the first time or looking for a more agile and growing ERP, this guide offers all the knowledge that will help you realise why Odoo is considered a great solution in the market.

What Is Odoo ERP?

Odoo is a collection of fully integrated business applications built to centralise and utilise key areas of your business. These apps serve different business purposes including Finance, Sales, Human Resource Management, Inventory Control, Manufacturing, E-commerce, and many others.

When Odoo is described as being fully integrated, it means that every Odoo app works well with each other in a single database. This integration feature provides seamless business management by reducing manual operations, data duplications and isolation.

Read more about Odoo modules:

• Odoo Product Lifecycle Management
• Odoo Accounting For Australia
• Odoo Manufacturing For Australia
• Odoo Inventory Management
• Odoo Point Of Sale

The Story Of Odoo

Odoo, originally known as TinyERP, was founded in 2005 by Belgian entrepreneur Fabien Pinckaers with a bold vision: to transform the innovative enterprise software market with totally free ERP software. Since the very start of his endeavour, Pinckaers’ clear objective was to disrupt the market giants, in his opinion, small and midsize businesses deserved a more agile and innovative solution.

TinyERP gained popularity, but further growth, especially beyond the small business market required a change in its branding. In 2009, TinyERP was renamed to OpenERP, reflecting that it had become completely open-source. The platform developed quickly and a large number of customers joined to contribute to its development. Moreover, the number of modules was increasing, and they covered various business areas such as sales, inventory, finance, and HR.

By 2010, OpenERP had expanded to over 100 employees and had been named one of the most rapidly growing businesses in Belgium at that time. As a result of the continuous expansion, the company managed to attract funds from leading European investors. This investment led to a significant change in the strategic direction - from the service provider to a software publisher with an extensive partner ecosystem.

In 2014, OpenERP underwent another critical change. Knowing that its product has turned into something more than traditional ERP with e-commerce and business intelligence, the company renamed it Odoo. This was followed by new Odoo positioning - a versatile business management software, not just an ERP.

“In May 2014, we renamed the company and product to Odoo. And a new story just started... a few years later, we became the most used management software worldwide” - Fabien Pinckaer, Odoo Founder & CEO. (source: Odoo)

Since then, Odoo has achieved exponential growth, becoming the most widely installed business management software globally with thousands of new installations every day. Today, Odoo now has 12,000,000+ users, 40+ core modules, a strong partner network, 48,000+ integrated apps, and a global presence.

Why Do Australian Businesses Choose Odoo?

Australian businesses adopt Odoo mainly due to its scalability, affordability, and localisation. Unlike conventional ERP solutions, Odoo offers a more flexible and comprehensive multi-business management solution for various industries such as wholesale and distribution, retail, e-commerce, real estate, professional services, and manufacturing:

• Payroll & Compliance: Odoo provides features that meet Australian labour laws, allowing pay stub generation, automated payroll calculation, and accounting integration.
• Tax & Financial Management: The platform also simplifies GST, BAS reporting and Peppol e-invoicing to help minimise complex tax accounting while ensuring proper tax returns.
• Local Shipping & Logistics: Odoo connects with Australia Post, DHL, Startrack and many other local carriers. This helps enhance real-time delivery cost calculations and procedures.
• Banking & Reconciliation: Users can import bank statements using OFX files to guarantee accurate bank account balances and minimise human error.
• Tailored User Experience: With the implementation of the English-AU language, Australian users can utilise the proper local date formatting and financial reporting structures.

Moreover, Odoo offers local hosting plans with data centres located in Sydney, contributing to better results and meeting the Australian laws of data privacy.

Watch this video for more details about Odoo localisation features for Australian businesses:

What Are Key Odoo Modules & Features?

Odoo has a wide range of modules that help manage various business aspects and activities. Here are the key modules and their most impactful features:

• Sales & CRM: Automate quotations, lead scores, sales forecasts, and activities to improve customer relationships and diversify the sales funnel.
• Inventory & MRP: Gain full stock control and production through inventory management, procurement, demand forecasts, and manufacturing management to achieve effective resource planning.
• Purchase & Vendor Management: Simplify procurement using automated tools such as requests for quotations (RFQs), vendor price lists and supply chain performance tracking.
• Project Management: Track tasks, foster teamwork and manage the overall project with Gantt charts, automated tasks, a multi-project dashboard, and time tracking.
• Accounting & Finance: Standardise and synchronise financial operations with real-time and multi-currency reporting, bank reconciliation, and payment providers that meet compliance and accuracy standards.
• Human Resource Management: Gain full control over payroll, leaves, recruitment and appraisals to reduce overall HR complexities.
• Website & E-commerce: Create and run online stores automatically with AI tools; sell through multiple channels including Amazon and eBay, set flexible price ranges, and integrate payment and shipping solutions.

One of Odoo’s key advantages is enabling users to choose only the apps they need and add more later. This offers scalability and cost-effectiveness for businesses across many industries.

Explore more details in The Guide To Odoo For Beginners.

How Much Does Odoo Cost?

1. What is Odoo’s total cost of ownership?

The TCO includes licensing, implementation, hosting, support and upgrades fees. Before deciding to implement Odoo, it is highly recommended to analyse Odoo’s total cost of ownership (TCO) applied to your organisation. Here’s a breakdown of the key cost factors:

1.1 License

Odoo offers flexible pricing based on:

• Users -  Licensing costs are calculated based on the total number of users accessing the system.
• Region - You will notice that the price is different according to your location.
• Pricing plans - There is a free plan which allows access to only one app, and several paid plans for full customisation and API access.

1.2 Implementation & Customisation

Setting up Odoo involves:

• Project scope & complexity - Price depends on the number of modules deployed and specific modifications made.
• Duration - The duration time for set up, configuration, testing, and deployment.
• Data migration - Data complexity and volume during the process.
• Training - Customised training for smoother system launching and adoption across the business.

1.3 Hosting

Odoo offers different hosting options:

• Odoo Online - Best suited for companies that do not need frequent customisations or modifications.
• Odoo.sh - Ideal for organisations that require more modifications and app integrations.
• On-Premises - This provides the maximum level of control, especially for businesses that need to meet various regulatory requirements or customise solutions to the maximum.

If you have other hosting options in mind, don’t hesitate to discuss them with our support team.

1.4 Support & Upgrades

These costs often include:

• Support level - The prices depend on how much help you need from the support agent (Service Level Agreement - SLA requirements).
• Updates - This is determined by the scope and complexity of the system upgrades.

2. What are Odoo’s available editions?

Odoo offers two main editions: Odoo Community which is completely free and open-source, and Odoo Enterprise which contains more advanced features that require users to pay for. The Community edition has integrated core modules like CRM, Accounting, E-commerce and others. However, users can only access the most features in the Enterprise edition.

What is Odoo Enterprise?

Odoo Enterprise refers to paid pricing packages that offer advanced features, full support, and greater customisation capabilities for organisations. It has three pricing plans:

• One App Free: It lets you use one app with as many users as possible, and there shouldn’t be a charge. If the app requires other apps installed, those are also free of charge.
• Standard Plan (currently AUD 34.4/user/month): This plan allows you to use many apps with basic functions.
• Custom Plan (currently AUD 52/user/month): This is best for businesses that require an API connection, complex workflows, or multi-company management.

Note: The price for Odoo plans may change considering your location and time visited. If you need the latest and most accurate pricing in Australia, please leave a quote on our Odoo pricing consultation service.

How Is Odoo Customised For Unique Workflows?

As an open-source ERP solution, Odoo’s versatility allows a business to deploy the system based on unique operational requirements. Here’s how Odoo can be customised to support unique workflows:

• Modular structure: Odoo’s modular environment allows users to add and exclude applications according to their needs. With a range of modules such as CRM, Sales, Inventory, Accounting, and HR, Odoo lets businesses develop a system that will suit their operations with simplicity and productivity.
• Customisable workflows: Odoo offers customisable solutions for defining, automating, and optimising different processes. Starting from lead tracking to bringing it to order fulfilment, developers can customise workflows to suit certain operations standards. One example is that the approvals, task assignments and notifications are automated to enhance efficiency and minimise errors.
• API & third-party integrations: Odoo provides API support to integrate with third-party applications such as payment gateways, e-commerce sites, shipping services, manufacturing systems, etc. Companies can integrate Odoo with other solutions to create a centralised environment, improving data exchange and integration.
• Customisable user access & role-based permissions: Our team also has developed a custom feature that allows Odoo to streamline user permission. Instead of providing individual access to each employee, you can establish a set of roles and assign users to them. This means that employees can only access and work with the Odoo applications and data needed for his/her work.
• Localisation & industry-specific customisation: Odoo is designed to work with multi-language, multi-currency, and taxation rules for multiple countries. Industry-specific customisation capabilities enable organisations to extend the functionality of modules for different industries, i.e. manufacturing, retail, health care, wholesale, distribution, and so on.

How To Know If Odoo Fits With Your Business?

Selecting the right ERP system is a crucial strategic step that defines your business processes, future growth, and productivity. Here are five helpful methods that help you determine if Odoo is the right fit:

• Evaluate your business needs: First, think about your main business activities and pain points. Do you require more efficient inventory control, less manual invoice processing or improved customer relationship management? Odoo’s modular structure allows users to use only the apps they need, and this can be useful in different industries and among businesses of different sizes.
• Look for industry peers, especially those within your location: Take time and try to find companies that also use Odoo and operate in your industry as well as location. Their experiences can provide you with great insights into possibilities, difficulties and opportunities in your niche, from those who faced the same challenges before you.
• Conduct a proof of concept (POC): It is more useful to try Odoo with proof of concept. This enables you to check whether Odoo is capable of processing your business operations successfully during the testing stage for smoother implementation. 
• Consider your budget & Odoo pricing: Odoo is an open-source software that comes with both free and paid versions. Understanding these options assists you in assessing the specific costs, such as license fees, hosting charges, and implementation costs.
• Process mapping & ERP gap analysis: Assess how Odoo fits into your current workflows. Check if there are any gaps and find out whether Odoo can close those gaps or requires additional configuration and customisation. This way ensures that Odoo aligns with your long-term business objectives.

What Is Odoo ERP Software - Frequently Asked Questions

1. What is the latest version of Odoo?

Currently, Odoo 18 is the latest version. However, Odoo releases a new version annually, with each update bringing enhanced features, performance, and new modules. Therefore, to find the most up-to-date version at the time you visit, please go to Odoo’s official website for more information.

2. Which industries benefit from Odoo?

Businesses can adopt Odoo across various industries such as manufacturing, retail, wholesale, e-commerce, healthcare, construction, and other professional services. What makes the system flexible and scalable is that businesses can add or customise the modules based on their needs.

3. Where should I go for a demo session of Odoo?

Odoo’s partners in Australia such as Havi Technology also provide personalised demonstrations with local insights based on your unique and complex requirements.

References:

• Odoo. The Odoo Story.