A popular misconception about ERPs is that ERPs are often thought to be only for larger enterprises. The word "Enterprise" connotes the image of large corporations. ERPs are about getting control of your business. Are all businesses not in need of control?
ERP systems, such as Microsoft Dynamics 365 Business Central, are being increasingly deployed in the SME sector. It's often a great success! Every company, regardless of its size, will benefit from consolidating data and having a solid business process. In a well-run SME company, accountants perform transactions, executives review reports, and analysts monitor revenue and costs. Owners can also gauge the business's performance. All this is done in the ERP. You might be able to use an ERP system even if you are a small or midsize business. However, the process of deploying ERP solutions for small businesses will be very different from that of large ERP implementation projects.
For more information on the ERP implementation process, see our post Six steps for a successful ERP implementation.

Do small businesses Require an ERP system?

An ERP system's services are not only beneficial to larger companies that have millions of customers but also help small businesses run smoothly. SMEs can reap the same benefits as large corporations from ERP systems, but often with a smaller turnover.

Are ERPs for small and large businesses the same thing?

They are different. When comparing ERPs for small and large businesses, it is important to remember that ERPs for large businesses are more common. ERPs became an option only for small businesses that could afford more complex functions and lower costs. This is due to two main reasons. Small businesses don't require enterprise-level functionality. They also cannot afford the expensive ERPs that big businesses have. Small businesses are more flexible to change. This contrasts with the way large businesses operate. They usually follow a certain routine. Their ERPs are, naturally, designed in different ways. Both businesses have different implementation methods. Implementation and documentation are both crucial factors. Larger businesses will require more documentation to implement ERP software.
Small businesses can now access cloud-based ERP solutions. For instance, Microsoft delivers a cloud-based solution for small businesses called Dynamics 365 Business Central. NetSuite also offers JCurve ERP (a small business edition).

Cloud ERP vs. On-premise ERP

Cloud ERP is easy to use and has many advantages over on-premise ERP. The main difference lies in the deployment. Cloud ERP is hosted directly on the server and can be accessed via the web. On-premise ERP, however, is installed locally on your servers and computers. They are very different in terms of cost. On-premise software costs more. It is, therefore, more expensive than capital investments. Cloud-based software is very affordable, which makes it an operating expense. Cloud ERPs are not a security risk. However, there is less chance of this happening today. They have had strict and secure standards in recent years. They are also less customizable. Software on-premise is easy to customize. Cloud-based ERPs are also very secure, as they are managed by companies. Cloud-based ERPs are a good choice for small businesses.

Small Business ERP:

Microsoft Dynamics 365 offers some of the most popular comprehensive business management solutions, including two major ERPs - Microsoft Finance & Operations (F&O) and Business Central. Each ERP solution has unique capabilities and features that can be tailored to any organization's needs. Dynamics 365 Finance and Operations aim to help businesses improve their financial performance, while Business Central facilitates efficient and automatable business processes without the use of silos. It can be difficult to decide which ERP is best for you. Let's see how they differ in their capabilities.

How do you choose the best ERP according to your business scale and needs

ERPs are essential in today's business world. ERPs can be used to manage customers, build customer relationships, increase employee productivity, and many other purposes. If you do it right, ERPs will soon be your lifeline for small businesses.
This section will discuss how ERP can be selected based on scale and demand.
  • The complexity of Business: Complex organizations may need Microsoft's Finance & Operations' depth of functionality. Business Central caters SMBs and can be configured to address complex requirements. Business Central can be customized to suit the needs of many organizations.
  • Employee Size: User counts are important when deciding which solution you require. Microsft's F&O is more suitable if you have 250-300 employees with a large transaction volume. Microsoft Dynamics 365 Finance & Operations has a 20-user minimum requirement, while Business Central only requires one.
  • Warehouse management: Business Central offers "Warehouse activities" functionality that allows you to manage product information. Your ERP software solution will update your records automatically after a sale to increase visibility and clarity. This permanent analysis, also known as "stock reconciliation," is ideal for your company. You may be wondering why. This allows you to reduce inventory to maximize your business's profitability, which is fantastic.
  • Supply chain complexity: Both business applications can support product-oriented businesses in manufacturing and distribution. The complexity of these systems will determine the size of the business they can support. Although Business Central is a more complex solution, it's ideal for companies with well-defined business processes. It is ideal for manufacturing industries with traditional processes to integrate Business Central into their existing software environment to manage usage, inventory management, and financial management. Finance and Operations are responsible for streamlining even the most complex business processes. Its finance modules are responsible for helping teams to create and stick to their budgets. The supply chain management module, on the other hand, allows companies to make use of Business Intelligence to analyze all aspects of a process, manage overall manufacturing and track relevant sales data.
  • Payroll and Human Resource Management: Every ERP system should have a human capital management Module. It is essential to manage your rapidly growing human capital. ERP for HR is typically required to manage the process of employees retiring from work. Dynamics 365 Finance & Operations has a Payroll module. Dynamics 365 Business Central doesn't. It is possible to solve this problem by integrating a payroll module specifically for D365 Business Central. Once the integration is complete, you will be able to run your payroll, file taxes and manage ACA compliance from Business Central.
Installing enterprise resource planning software is the best way to go. ERP is especially important for small businesses. You might ask, "Why?" It takes a lot off your shoulders. You will be able to anticipate possible dangers. Employees will be able to work together more easily. You will also establish great customer relationships. It will also help you to predict the future of your business. It is impossible not to be a forecaster. Next, you must determine when an ERP is needed. Consider your company's financial strength, demand, and funds. This article has shown you the two most cost-effective ERP solutions for small businesses.
You need to think about your business goals, future vision, and requirements before you make a decision between Dynamics 365 F&O or Business Central. One of the key differences between Dynamics 365 F&O and Business Central is the fact that Dynamics 365 F&O includes more enterprise functionality than Business Central. For companies looking for a comprehensive ERP solution, this will be a major reason to consider Dynamics 365 Business Central. Dynamics 365 Business Central implementation offers a speedy implementation and lower total cost of ownership.
Now that you've seen both offerings, you can decide which ERP is right for you. Advaiya is available to help you make a decision or request a complimentary technology assessment.
Advaiya is a Microsoft-certified ERP implementation partner having extensive experience in improving the business outcomes of our customers. We provide end-to-end business productivity solutions that include the continuous convergence of ERP, Azure Cloud, and Analytics. We are experts in the Microsoft Dynamics 365 product range, including Dynamics 365 Business Central, Dynamics 365 CRM, Dynamics 365 Field Service and Dynamics 365 Finance and Operations, and other Microsoft products.
Contact us today to schedule a consultation!
Ravi Karda

Ravi Karda

Ravi has over ten years of expertise, focusing on ERP development, strategy building, and solutions to challenging business issues. He has also recently gained experience in information technology-related tasks such as cloud server management & integration formulation strategy, SAP S/4 HANA, and Microsoft Dynamics 365 Business Central installation. Ravi Karda has completed various unique assignments for business process re-engineering, standard operating procedure design and implementation, and organizational policy drafting for middle-level organizations.

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