Process and Cost of Custom ERP Software Development

Process and Cost of Custom ERP Software Development

Whether you’re a large corporation, a small business, or a startup, custom ERP software is worthwhile to adopt. There is a widespread misconception that ERP systems necessitate complex workstations, servers, and other expensive technology, and that only large corporations can fully utilise them. Modern software trends, on the other hand, suggest differently. Because of the increasing popularity of SaaS solutions, even small and medium-sized organisations can offer to buy or construct an ERP system. Fortunately, the adaptability of such software allows for the customization of modules as well as the overall level of system complexity. As a result, businesses of all sizes will benefit from it.

An ERP system for a small business does not have to be as complex as one for a large corporation, but it is still a powerful tool that can help your company develop and automate .

Among the benefits of installing custom ERP software are the automation of multiple procedures and the correctness of recorded data. People no longer have to deal with manual data entry using ERP software, which reduces human errors.

Thus, no matter what the size of your business is. If you’re willing to optimize your business processes, this article is for you. We’ll describe everything you need to know about custom ERP software development.

Let’s begin with a definition. ERP is an abbreviation for enterprise resource planning. An ERP system is a powerful tool. Its primary goal is to automate most company procedures and improve inter-departmental communication. There are several additional functions that custom ERP software is expected to perform. We’ll go through them in more detail later in the article.

An ERP system is similar to a large database in which all of a company’s data is stored and readily controlled and analysed. As a result, each department has access to it. Of course, there are roles, permissions, and various levels of access. Nonetheless, one of the primary purposes of such a system is to provide maximum visibility to team members and improve cross-functional collaboration.

What Does an ERP System Do? 

Numerous business processes are going inside one company, and sometimes it is difficult to control them individually fully and how they interact. The more separate and big different departments are, the more difficult it is to establish an effective workflow. By implementing a custom ERP system, you create a coherent ecosystem where all units are connected, and the collaboration between them is as easy as possible. Thus, the main goal of ERP software is to unite all business processes within one system and make them operate as a single mechanism

To achieve this synergy, an ERP system uses modules. Each of them is aimed at improving a specific performance area. Many of them eventually come down to three main categories: human resources, assets, and sales. Thus, the main ERP modules are:

  • Human resource management
  • Customer relationship management
  • Financial management
  • Sales and marketing
  • Purchasing
  • Manufacturing
  • Supply chain management
  • Inventory

These modules actively interact with each other. For example, the HR component stores information about the list of employees and their vacations. At the same time, payroll, which is a part of the financial management module, takes that data from HR, calculates the amount of hours/days worked, vacations, sick leaves, and enrolls the salary paychecks at the end of the month to the banking system. Another example of modules’ interaction is sales, SCM and manufacturing. They all aim at tracking demand and dealing with logistics. So, the SCM module takes the data about raw materials from manufacturing, coordinates the logistics, and conveys the info to the sales module, which focuses more on delivering the final product to the customers.

You can customize the number of modules whether you’re deploying an out-of-the-box system or building custom ERP software. However, in the last case, you have much broader opportunities in setting up the system according to your specific needs.

OFF-THE-SHELF VS. CUSTOM ERP SOFTWARE

When you’ve decided on investing in an ERP system, you need to figure which option to choose: custom ERP software development or buying an out-of-the-box solution. Each option has its pros and cons, so let’s look into them.

Custom development is always a reasonable choice no matter what kind of software we’re talking about. Bespoke solutions invariably win over ready-made ones for numerous reasons. However, it might be pricey, and it is the most common reason why startups and middle-sized businesses turn down this option. 

As you know, enterprise resource planning solutions are complex. Thus, deciding to invest in custom ERP software development is a significant step that you should take after thorough consideration. But, to provide you with a clear picture, we’ll discuss both options.

Off-the-shelf ERP system

You can find various ready-made ERP solutions. Many of them had years to establish themselves well on the market. The most popular ones are SAP ERP and Oracle ERP Cloud. In the picture below you can see more information about the market division between the ERP vendors:

Huge trusted companies developed them, but it doesn’t deny their most significant disadvantage against custom ERP software – bespoke solutions’ main strength of being built from the ground according to client’s needs. No matter how hard those who develop ready-made ERPs try to achieve it, they can never catch up with the custom solutions on this criterion. Off-the-shelf applications usually have a modular structure, allowing users to work with inventory, payments, human resources, etc. However, these modules may still not cover all the needs, or otherwise, be excessive. Therefore, the team will have to spend more time learning how to use the ERP system and tuning it before taking full advantage of it. It mitigates the only advantage of ready-made ERP products. Adjusting out-of-the-box ERP still takes less time and money, but close enough to what’s needed to build everything from scratch.

While speaking of custom ERP application development, the team spends a great deal of time on the discovery. During this stage, you work with business analysts to find out what modules and features you’ll need. Though, you save this time by opting for an out-of-the-box solution (but spend it later on adjusting the system to your needs). Thus, deployment is another controversial question. It makes sense for a small or medium company to expect fast deployment of an out-of-the-shelf ERP solution, but enterprises may face various challenges with it due to the complex workflows. In the process of deployment, big companies often have to resort to modifying the source code and work with APIs.

Sometimes, ready-made ERPs’ biggest strength can become their biggest weakness. If the number of adjustments and unique relations becomes too big – implementation can take more money and time than custom ERP development. Not to mention regular maintenance, support, and licensing costs associated with software products on the subscription model.

Usually, ready-to-use ERP systems offer two pricing models: subscription and one-time license payment. SaaS solutions providers use subscriptions, and those who provide on-premise ERP software opt for licenses. Subscription is usually paid per user monthly or yearly, and the license is a one-time initial payment. In the second case, you practically own the program. But the downside is that you have to deal with all occurred problems yourself and settle for the original version of the software as the license does not include support and updates. However, if you face some issues, remember that many people use this software so that you can find some answers in the community.

At first, when you see the $100 monthly price, it might seem very budget-friendly. It is a price per user, and for an average company with 100 employees, it will result in $10k monthly, which is $120k per year. To compare, it is an average price for a simple custom ERP application development. But, in the case of bespoke software, this money is only paid once.

An inevitable advantage of out-of-the-box ERP software is that you know what to expect from using it. Many people have already implemented it and given their feedback. Thus, you can find out information about its performance, scalability, and other technical aspects before investing in it. 

To summarize, among the advantages of the off-the-shelf ERP systems there are:

  • Proven quality
  • Community support
  • Lower upfront costs
  • Relatively fast deployment (in case of small and medium-sized companies)

The drawbacks of ready-to-use systems are:

  • Difficult integration for enterprises
  • Expensive license
  • Little to no customization opportunities
  • Excessive functionality, which is not easy to remove
  • Lack of specific modules or features

CUSTOM ERP SOFTWARE DEVELOPMENT

If you’ve eventually decided on custom ERP software development, we suggest you the precise description of the development of enterprise resource planning systems. Let’s start with the key functionality.

Core ERP Modules

Defining a future app’s features and modules is one of the most critical processes. A custom ERP system offers a broad set of modules, but you need to know which ones are crucial for your business. Specialists will help you with it during the development process’s discovery stage, which will be described later. And now, let’s look at all possible module options, so you can see the whole picture

ERP Modules

Business intelligence. Data disunity is a considerable threat to business efficiency. Without a single system that connects the information from different departments, analyses, and reports it, you’ll have to spend a lot of time doing it manually. The business intelligence module, which is practically a combination of integration, analysis, and reporting modules, solves this problem. It forms dashboards formed on all business processes. They include analyzed data and reports, which allow you to estimate the company’s performance and provide you with real-time visibility and transparency. Besides, a business intelligence module has a forecasting ability. It generates some feasible projections on sales, time management, and others.  

Automation. It is one of the main features of an ERP system. The possibility to automate all repetitive processes and those that require a lot of manual entry saves very much time and allows employees to focus on high-priority tasks instead. The automation module implies various functions that vary depending on the department. It can be forming invoices, payroll reports, etc.

Accounting. Companies of any size must organize their budget wisely. It requires thorough planning and tracking, which is difficult for financial leaders. The accounting ERP module makes this task easier for them by gathering financial information from all departments in one suite. This module helps to control all economic activities. It has a wide range of functions, including managing assets, payrolls, receivables, payables, general ledger, and conducting the analysis based on gathered data. Accounting may also include a supply chain management submodule. Apart from financial workflows, it is responsible for logistics and distribution. 

CRM. The customer relationship management module is tightly connected with marketing and sales. But its primary goal is to increase customer retention and make communication with them more efficient. CRM modules keep the data about clients in one database. It includes names, contacts, purchase order history, their preferences, etc. What makes CRM an even more efficient tool is the integration with the sales module. It results in the possibility to also work with inquiries, invoices, and other order data. Acquiring clarity about the customers allows building more lasting relationships with them and positively impacts the company’s workflows in general.

HR. The human resources module is designed to manage employees and everything related to them. We can divide all its features into such groups: recruitment, time management, personal information, and payroll. Each submodule has a set of features that help HR managers do their job faster and more efficiently. HR module is an extensive database where such information is stored: personal data, working schedule, onboarding, paycheck reports, efficiency metrics, compensations, retirements, skill management, etc. Apart from keeping employees’ data, this module integrates with others, such as accounting, analytics, or reporting.

Marketing. The marketing module is tightly integrated with others, including sales, CRM, and business intelligence. This is due to marketing’s versatility, including communication with customers and employees, advertisement creation, performance, surveys, and competitor analysis. As the integration of a marketing module with others is essential, its functionality may resemble an existing one. Its main features include analysis of customer engagement, performance, advertisement planning, promotion tactics, sales forecasts, and reports. 

Manufacturing. Initially, ERP systems were primarily used in manufacturing. That’s why this module is the most established one. It provides the opportunity to optimize all processes related to material purchasing, storage, and distribution. An inventory component regulates the procurement and selling of raw materials and optimizes their stockpiling. A sourcing submodule helps rationalize the expenses and avoid buying the substandard materials by keeping the data about previous purchases and each raw material. And the integration with the SCM module helps to reduce delivery time and cut down unnecessary expenses

ERP Software Development Services

When you’ve decided in favor of custom ERP software development, you likely want to know more about the development process. So, we’ll describe what steps it takes to build a quality custom ERP system that meets all your expectations. 

We can divide the development process into such stages:

  • Discovery
  • Design
  • Development
  • Testing
  • Support

Let’s look more closely at them. The discovery stage is essential because the team forms a detailed understanding of the product during it. It allows specialists to save a significant amount of time later on. At this point, people who are most involved in the process are a project manager, a product owner, a business analyst, and designers. They all work coherently to make the follow-up steps easier to perform by forming the deliverables, including wireframes or mockups and a software requirement specification document. 

For a medium complexity project, discovery takes about 8 weeks.

As the SRS document explicitly describes the application logic, once it’s ready, designers have all the knowledge to start doing the visual design and, in particular, creating mockups. A mockup is a screen layout with the minor details already designed. It provides the possibility to see the app’s workflow. However, only prototypes simulate the actual app’s behavior, while mockups just show its appearance. Usually, designers spend about 6 weeks to get the work done, but the number may vary depending on the complexity of ERP mobile application development.

The development stage is the longest one and includes an immense amount of work. At this point, programmers do the coding according to the chosen SDLC model. For example, there are many of them: Waterfall, Iterative, V-shaped, Agile, and others. The last one is the most popular and effective due to its flexibility. IT allows amending to the code right in the middle of the process, so in case if a customer wants to change anything, he doesn’t have to wait for the next iteration to start. Thus, Agile not only saves time but also results in improved customer relationships. Usually, specialists determine the timeframes at the discovery stage, so programmers follow pre-defined deadlines. Development may take from 20 to 30 weeks for a medium project.

After the development, the QA team starts their job. Some unexpected bugs are inevitable even after the launch, but QA engineers do their best to reduce this potential. The testing stage typically lasts 2 weeks or less.

The support, maintenance, and updates stage doesn’t have timeframes. It goes on for years after the app is available for use. At first, clients need ERP software development services provider’s help quite often because many minor faults become visible only in actual app use. After this, a service provider and a client get in touch when it’s time for updates or a customer has some concerns or suggestions.

The Tangible benefits of Custom ERP Software in the Manufacturing Industry

The Tangible benefits of Custom ERP Software in the Manufacturing Industry

ERP (enterprise resource planning) software is a must-have for businesses in the manufacturing industry. Custom ERP software can have a positive impact on nearly every aspect of a manufacturing company. A solid ERP solution can assist manufacturers in becoming more productive, secure, and cost-efficient, as well as promoting collaboration and assisting in decision-making.

Manufacturers today face high demand for faster processing, higher output, and more streamlined production. Many of the problems that businesses in the manufacturing industry face can be solved with the right tools. Learn more about ERP software and how custom enterprise resource planning can benefit the manufacturing industry.

ERP is a process that businesses use to manage and integrate critical aspects of their operations. ERP software solutions allow a company to integrate all of the processes required to run a successful business. This process entails gathering and organising business data through the use of a software suite that includes applications that automate common business functions such as sales, production, accounting, and quoting.

It can be difficult to manage information across multiple departments within an organisation. Enterprise resource planning encourages the free flow of communication between departments by providing a single source of accurate, real-time information. ERP can manage all business resources, from human resource staffing to raw material ordering in purchasing.

The unique components of an ERP system are based on the business’s specific requirements. However, there are some fundamental features that all software should have, such as automated features to reduce errors and mobile access to allow users to access the software from any device. ERP solutions should also include productivity tools that allow executives to analyse and measure performance.

Advantages of Manufacturers Using Custom ERP Software:

Custom enterprise resource planning software has proven to be increasingly useful in the manufacturing industry. Companies of all sizes are realising the value of a custom ERP solution for streamlining business operations, increasing efficiency, and lowering costs.

Packaged ERP solutions have some advantages, but most fall short of meeting the needs of a growing business. Off-the-shelf ERP software frequently limits flexibility, whereas custom ERP systems aim to meet an organization’s unique preferences, requirements, and boundaries. Manufacturing companies can stay ahead of the competition by using custom ERP software.

The following are some of the most important ways that custom ERP software can aid the manufacturing industry:

  • Optimized Production Management

Manufacturing firms are under enormous pressure to maintain rigorous product timeframes in order to meet client demands. This necessitates manufacturers optimising their production cycle while adhering to industry norms. Custom ERP software frequently includes a production module, which enables enterprises to shorten the manufacturing cycle and increase overall workplace productivity.

Businesses can quickly track on-site activity, automate task scheduling, and streamline product planning using custom ERP software. Automation inside ERP software ensures that producers are never caught off guard in the absence of raw materials and equipment required to sustain routine operations.

  • Greater Workflow Visibility

Prior to the emergence of ERP systems, coordinating between multiple work sites took a significant amount of time and effort. Companies have to make phone calls or physically visit physical sites to acquire information on certain sections of the business, wasting significant time and money, especially for organisations with locations in different time zones.

Businesses in the manufacturing industry can now benefit from increased workflow visibility thanks to the revolution of custom ERP software. Regardless of location, a worker may open a database from any device to access information in real-time, allowing team members to stay on task while optimising operations in manufacturing plants and distribution centres.

  • Improved Inventory and Warehouse Management

 Inventory management is an important aspect of manufacturing. To track inventory movements, minimise supply outages, and keep accurate records, proper inventory and warehouse management are required. Keeping a proper stock inventory and managing the warehouse effectively saves vital resources like time, money, and people.

 Custom ERP software improves inventory and warehouse management by giving real-time operational analytics. Businesses can simply track stock movements throughout the production cycle with the correct software solution. ERP software can also be upgraded with auto-replenishment functions, which eliminate stock outages.

  Enterprise resource planning solutions organise and make data and documents easily available. This improved efficiency decreases the number of duplicate documents and ensures that data is accurate and up to date. Proper data storage and management aids in the reduction of many of the typical cyber dangers that modern firms face.

  • Reduced Operational Costs

Business leaders are constantly looking for new methods to cut operational costs. Standard processes may generate enough cash, but they also have high maintenance expenditures. Custom ERP software can help businesses save money in a variety of ways.

Manufacturing companies are seeing higher cost savings by managing their operations through a single centralised system rather than several distinct systems, each of which requires separate maintenance and operation expenditures.

When common operations are streamlined, savings are realised not just in the warehouse and distribution facilities, but also in operating and administrative expenditures. Work may be completed more quickly and efficiently, resulting in increased production, all of which have a direct impact on a company’s bottom line.

  • Customizable Business Solutions

The most appealing feature of custom ERP software is that it is tailored to the exact demands of the business. No two manufacturing companies are alike, and each has its own set of requirements. Some manufacturers are small and only have one site, but others are massive and may partner with multinational firms.

 ERP software may be tailored to fit the ever-changing needs of modern industrial companies. These cutting-edge solutions also incorporate cutting-edge technologies such as the Internet of Things (IoT) and artificial intelligence computer solutions.

  • Increased Customer Satisfaction

Customer happiness is one of the most valuable assets a company can have. Businesses form working connections with their clients in order to encourage repeat purchases that benefit their mutual bottom lines. Businesses must deliver high-quality items on schedule and at a competitive price to keep customers satisfied.Custom ERP software solutions assist manufacturers in meeting the demands and expectations of their customers. Business executives may use real-time data to make critical production choices, guarantee that consumers receive the products they require on time, and eliminate problems throughout the process.

Businesses that continue to satisfy their customers have a higher rate of repeat sales. These companies are also more likely to establish a positive reputation in the industry as a reliable source of high-quality goods and services.

The Advantages of POS Systems for Small Businesses

The Advantages of POS Systems for Small Businesses

Excellent point-of-sale systems provide numerous advantages to small businesses. They will not only assist in the management of day-to-day sales and inventory, but they will also assist in the growth of businesses through the use of built-in loyalty and marketing software, as well as provide business intelligence.

The following are the top eight advantages of POS systems for small businesses:-

  • Reduces the amount of time spent on administration

Effective POS software will be able to provide you with relevant reports in a timely manner to assist you in making profit-enhancing decisions. It is critical to have point of sale software that is simple to install, gets up and running quickly, and is simple to use. A streamlined point of sale system will reduce administrative hours and free up time for owners to work ‘on’ their business rather than ‘in’ their business.

  • Increase the profitability of your store.

POS solutions have the potential to boost store profitability. This can be accomplished through effective inventory management as well as the capture of buyer behaviour, which will allow for more personalised and targeted marketing campaigns. Next-generation retail software can also boost profits by allowing you to sell, order, and market from anywhere, at any time.

  • System of Inventory Control

A good point of sale system will include inventory management software. This is critical for any small business to ensure that the right stock arrives at the right time. Inventory management systems enable you to make informed ordering decisions based not only on available stock, but also on buyer behaviour and historical data.

  • ‍Loyalty

Loyalty programmes for valued customers should also be possible with POS solutions. Such programmes have been shown to assist in the growth of small businesses, the creation of repeat customers, and the increase of sales. This can be accomplished by utilising loyalty points and vouchers. Furthermore, they enable you to collect buyer information and track buyer trends. This data can be used to create targeted incentives, marketing campaigns, and, most importantly, a better overall customer experience.

  • Marketing

A POS system can be extremely useful in assisting you in the planning of marketing campaigns. You can use the information gathered to ensure that your marketing efforts are personalised and relevant, resulting in increased profits.

  • Business intelligence

Point-of-sale systems should have a single central database that is real-time, accessible, and receives automatic updates. It should be able to generate meaningful reports, allowing small businesses to make more informed business decisions.

  • Instant access.

The ability to access your POS solution from anywhere and at any time is now required. Small businesses must be able to work from home or while on the road, and instant access is critical. New generation technology has transformed the way retailers operate, allowing for real-time access to financial and operational data. Another significant advantage of having immediate access is that it allows small businesses to provide better customer service. Finally, POS systems should allow for the integration of physical storefronts and online shops.

In conclusion, there are numerous advantages to using point of sale systems for small businesses, and an efficient system is critical in today’s digital age. They have the ability to improve the efficiency and profitability of all aspects of day-to-day operations, from initial stock ordering to post-sale, targeted marketing.