The Complete Guide to ERP for Startups

A startup, by nature of the name itself, is a company in the first stage of its operations, and is often financed by its founders or by external venture capital or investment companies during the initial starting period. Startups “get started” by focusing on their mission, vision, and their business goals.

For most startup companies, this means forging ahead at lightning speed, supported by a veritable “mix” of software products and tools. From legacy spreadsheets to free, downloadable business or accounting apps, the typical startup relies on limited software solutions that don’t work together, can’t work together, and don’t share a common database. Over time, data gets lost, employees and teams have to rely on manual processes to get the job done, and productivity and efficiency – go out the window. 

Implementing an ERP system is, hands down, how a startup can “keep up,” to significantly enhance productivity, efficiency, and their bottom line. Larger companies and enterprise-level corporations are required to manage and account for every conceivable corner of their operations. But regardless of their size, vertical market or prospective customer base, today’s startups require no less. In fact, they require even more – an ERP system that is affordable, flexible, scalable, and to top it off, one that can be easily implemented. Rest assured, it can be done!
 

 

“We’re a startup, we can’t afford an ERP.”

Truth is, you can’t afford ‘not’ to implement an ERP system. According to a recent report from business software and services review website, G2.com, the top reasons for implementing an ERP are increasing efficiency (35%) and cost advantage (29%). The report also cites that an unprecedented 95% of businesses, irrespective of their size, achieve major improvements after using ERP via reduced process time, increased collaboration, and centralized company data. 

While it’s never easy to estimate precisely ‘when’ to implement an ERP system, most startups tend to wait until they have a ready product or service to take to market. Others, those still on the fence, are quick to settle on any ERP, in an attempt to stay afloat, and maintain business continuity, whatever the cost. 

With startups closely monitored, scrutinized, and often have limited budgets, especially when funded by outside investors, the upfront costs of an ERP system can be difficult to pitch to a board of directors. But if your startup company is growing at a rapid pace, and you can no longer manage and control your operational processes and your finances, then it’s the right time for ERP. 

As a startup, deciding to invest in an ERP system, is a difficult, time-consuming task in itself. High costs are often a deterrent for startups who can’t see ERP’s full potential from the get-go. With an ERP, the means justifies the end, and the ‘end’ is improved ROI. Over time, startups can achieve increased ROI in terms of reduced operating expenses, shorter sales cycles, and lower costs to manufacture goods or deliver services to end-customers. 
 

Here are the 6 key benefits of implementing an ERP system in your startup company:

1- Go 360. An ERP system gives you a holistic, 360-degree view of your operational business processes, enabling you track all aspects of your business throughout the entire lifecycle, and make better, more informed business decisions. With an ERP, your operations and finances are transparent, ready, available and visible to your management team – and to your investors, who control and monitor your budget and funding. 

 

2- Just automate. With an ERP, workflows between employees and departments are automated, streamlining information, tasks, and activities, to increase productivity and efficiency. An automated ERP system uses real-time data and provides the most accurate, up-to-date business information. Plus, automated workflows replace arduous and mundane manual tasks, saving on time, manpower, and costs, by virtually eliminating manual errors.

 

3- One system for all. A fully integrated ERP system aggregates all of your data in one database, allowing you to manage and automate business processes across your organization, all from a single platform. Integrating multiple systems into a single database helps startups to consolidate business data, and streamline their operations with automated, real-time reports, analyses, and more. 

 

4- Always “on” data. With an ERP, your business data is always accessible, and always up-to-date. Because your data is stored in a centralized location (database), it enables multiple users to input and modify information as required. An ERP system compiles the data, which can then be accessed by authorized users, whenever they need it to do their job. Decisions are easier and processes are simpler when driven by reliable, real-time data. 

 

5- Save big. An ERP system reduces overall operational costs. As an ERP is a comprehensive system, it eliminates the need for separate software in each department. This saves on costs in terms of data re-entry, error reduction, and the recurring costs of licenses, updates, and employee training. ERP automates your operational workflows. This means more work can be done using less time, resources, and manpower, ultimately leading to fewer operational costs overall, setting your startup on the right path – towards growth.

 

6- Power your supply chain. With an ERP, you can enhance operations across your entire supply chain, including all stakeholders, such as third-party vendors/suppliers, by streamlining and automating your procurement processes, inventory, manufacturing, and more. ERP improves the flow of information across departments, for greater visibility, tracking, and generating real-time insights from data analytics throughout the supply chain.

Your ERP System will Yield Measurable Results

Your startup company was established to fundamentally produce, to deliver, to grow – and to become profitable.

Perhaps one of the best investments you will ever make, an ERP system will ultimately manage, control, monitor and automate your operational business processes, from start to finish. When all is said and done, your ERP system will yield measurable results – and save you valuable time, resources, costs (and headaches), across the board. 

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