{"id":591,"date":"2019-09-10T11:10:25","date_gmt":"2019-09-10T11:10:25","guid":{"rendered":"https:\/\/www.mrpeasy.com\/blog\/?p=591"},"modified":"2022-12-21T10:23:10","modified_gmt":"2022-12-21T10:23:10","slug":"7-steps-choosing-right-erp-small-manufacturing-business","status":"publish","type":"post","link":"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/","title":{"rendered":"7 Steps to Choosing the Right ERP for a Small Manufacturing Business"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Running a successful manufacturing business often means being able to adapt new technology fast to sustain strong competitive advantage. <\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"500\" height=\"281\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Choosing-the-Right-ERP-for-a-Small-Manufacturing-Business.jpg\" alt=\"Choosing-the-Right-ERP-for-a-Small-Manufacturing-Business\" class=\"wp-image-3598\" srcset=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Choosing-the-Right-ERP-for-a-Small-Manufacturing-Business.jpg 500w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2019\/09\/Choosing-the-Right-ERP-for-a-Small-Manufacturing-Business-300x169.jpg 300w\" sizes=\"auto, (max-width: 500px) 100vw, 500px\" \/><\/figure><\/div>\n\n\n\n<!--more-->\n\n\n\n<p class=\"wp-block-paragraph\"><em>You can also listen to this article:<\/em><\/p>\n\n\n\n<figure class=\"wp-block-audio\"><audio controls src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2020\/02\/7-Steps-to-Choosing-the-Right-ERP-for-a-Small-Manufacturing-Business-1.mp3\"><\/audio><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">This is a complicated task when it comes to selecting the right ERP\/MRP (<a aria-label=\"Enterprise Resource Planning (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/enterprise-resource-planning\/\" target=\"_blank\" rel=\"noreferrer noopener\">Enterprise Resource Planning<\/a> \/ <a href=\"https:\/\/www.mrpeasy.com\/mrp-system\/\" target=\"_blank\" rel=\"noreferrer noopener\">Manufacturing Resource Planning<\/a>) software considering a wide range of ERP\/MRP software differing in price, functionality, and complexity. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This short guide will save you time if you are on the hunt for a new <a href=\"https:\/\/www.mrpeasy.com\/blog\/manufacturing-erp-systems\/\" target=\"_blank\" rel=\"noreferrer noopener\">manufacturing ERP<\/a> or are considering changing your current system that does not answer your requirements.<\/p>\n\n\n<div class=\"banner-v2\">\n    <p class=\"banner-v2__desc\">Start your ERP implementation today<\/p>\n    <a class=\"banner-v2__link\" href=\"https:\/\/www.mrpeasy.com\/sign-up\/\" target=\"_blank\" data-ga-event=\"blog_signup_banner_blue\">Try MRPeasy for free<\/a>\n<\/div>\t\t<style>.banner-v2 {\n    float: right;\n    display: flex;\n    flex-direction: column;\n    justify-content: center;\n    align-items: center;\n    padding: 40px 32px;\n    gap: 16px;\n    width: 356px;\n    height: 205px;\n    background: linear-gradient(199.68deg, #6084E5 13.17%, #5FA7DD 82.1%);\n    border-radius: 4px;\n    margin-left: 12px;\n    margin-bottom: 12px;\n    margin-top: 15px;\n}\n\n@media (max-width: 767.98px) {\n    .banner-v2 {\n         width: 100%;\n         height: 173px;\n         margin-bottom: 0;\n         margin-left: 0;\n    }\n}\n\n.single__content p.banner-v2__desc {\n    margin: 0 !important;\n}\n\np.banner-v2__desc {\n    width: 292px;\n    font-style: normal;\n    font-weight: 700;\n    font-size: 22px;\n    line-height: 29px !important;\n    text-align: center;\n    color: #FFFFFF;\n    margin: 0 !important;\n    order: 0 !important;\n}\n\n.single__content a.banner-v2__link {\n    color: #FFFFFF !important;\n}\n\n.single__content a.banner-v2__link:hover {\n    color: #003557 !important;\n}\n\na.banner-v2__link {\n    display: flex;\n    justify-content: center;\n    align-items: center;\n    width: 181px;\n    height: 51px;\n    padding: 18px 0;\n    border-radius: 4px;\n    background: #003557;\n    font-weight: 700;\n    font-size: 16px;\n    color: #FFFFFF !important;\n    text-decoration: none !important;\n    order: 1 !important;\n}\n\n.banner-v2__link:hover {\n    background: white;\n    color: #003557 !important;\n}<\/style>\n\t\t\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #343333;color:#343333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #343333;color:#343333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_1_Budget\" >Step 1. Budget<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_2_Buy-Out_Licensing_vs_Subscription\" >Step 2. Buy-Out (Licensing) vs Subscription<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_3_The_Platform_SaaSCloud_vs_On-Premises\" >Step 3. The Platform: SaaS(Cloud) vs On-Premises<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_4_Functionality\" >Step 4. Functionality<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_5_Pre-selection_process\" >Step 5. Pre-selection process<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_6_Final_selection\" >Step 6. Final selection<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.mrpeasy.com\/blog\/7-steps-choosing-right-erp-small-manufacturing-business\/#Step_7_Customization\" >Step 7. Customization<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_1_Budget\"><\/span>Step 1. Budget<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">It is true, that there are solutions that can charge hundreds of thousands for a license and implementation, but this does not mean, that small and midsize businesses cannot afford an ERP. However, the chance is high that expensive systems used by big corporations will be useless to SMBs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>How to define the budget?<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The rule of thumb is to calculate all the costs (both direct and indirect) associated with an ERP for two years of operation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Number of users<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Another variable that defines the budget is the number of expected users, which can be calculated by taking the number of people in your office and adding one additional user per shift.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_2_Buy-Out_Licensing_vs_Subscription\"><\/span>Step 2. Buy-Out (Licensing) vs Subscription<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">There are two main pricing options to select from when deciding on the budget: <br>1. Buying a license, or <br>2. Sticking with a monthly (or annual) subscription plan. Both options have cons and pros.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For example, on-premises software providers usually offer licensing. If selecting this option, one must be aware, that on-premises vendors often have several fees which are not always obvious at the beginning (setup, software updates, software maintenance, additional infrastructure, customization, support, or privileged support, etc.).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Whereas the subscription model is popular among <a href=\"https:\/\/searchcloudcomputing.techtarget.com\/definition\/Software-as-a-Service\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Software-as-a-Service (opens in a new tab)\">Software-as-a-Service<\/a> solutions where you pay only if you use the software. Usually, in this case, the pricing policy is more transparent (also means predictable) and also flexible.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_3_The_Platform_SaaSCloud_vs_On-Premises\"><\/span>Step 3. The Platform: SaaS(Cloud) vs On-Premises<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">During recent years we have witnessed a trend of SaaS solutions reasonably becoming increasingly popular. The advantages are obvious:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>No need to install anything (and pay for the installation)<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>You can access your ERP anywhere, from any device, which allows mobility<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>No need to keep the software up-to-date<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>No need for additional infrastructure (own servers)<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">However, there are some scenarios where on-premises software is still the only option since: <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Having the software and database on your own servers could be more secure if you have your own highly professional IT specialists<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>Internet access is still not always available in rural areas<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_4_Functionality\"><\/span>Step 4. Functionality<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Apparently, if you are a manufacturer then not every ERP will suit your needs, and not every ERP claiming to have a focus on manufacturing can offer functionality particularly required in manufacturing, such as production planning and scheduling and equipment load charts, as an example. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">No one knows your business as well as you do, so think of functions that are of primary importance to you, make a list and start searching for a manufacturing ERP that meets these requirements.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You can also put down some good-to-have features (like integration with the accounting software you already use) \u2013 these will help you out when you already have a list of candidates offering the same main functionality.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_5_Pre-selection_process\"><\/span>Step 5. Pre-selection process<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">When you follow the steps above, then you will get a list of 4-5 ERP vendors which answer your basic needs in terms of main functionality, platform, and pricing model. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>You may also like this infographic of <\/em><a aria-label=\"Top 7 Mistakes When Searching ERP Software (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/blog\/infographic-top-mistakes-when-searching-mrp-erp-software\/\" target=\"_blank\" rel=\"noreferrer noopener\"><em>Top 7 Mistakes When Searching ERP Software<\/em><\/a><em>.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Now this list should be brought to 2-3 options at most since this is the most reasonable number in terms of time and resources spent for evaluation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">To filter out the companies that are not worth your time, contact each software provider with questions regarding functionality or similar and evaluate their speed and quality of response. <strong>Remember, this will be your strategic partner for several years<\/strong> and slow communication already from the start is not a good sign.<\/p>\n\n\n<div class=\"banner-v1\">\n    <div class=\"banner__text\">\n        <div class=\"banner-v1__title\">Test the #1 manufacturing ERP system for small businesses<\/div>\n        <div class=\"banner-v1__desc\">MRPeasy offers a 15+15 day free trial period with no credit card info needed.<\/div>\n        <div><a class=\"banner-v1__link\" href=\"https:\/\/www.mrpeasy.com\/sign-up\/\" target=\"_blank\" data-ga-event=\"blog_signup_banner_white\">Try now<\/a><\/div>\n    <\/div>\n    <div class=\"banner__img\">\n        <img decoding=\"async\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/themes\/mrpeasy\/assets\/images\/banner.svg\" alt=\"banner\">\n    <\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_6_Final_selection\"><\/span>Step 6. Final selection<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Now that you have a final list of 2-3 candidates for becoming your next new and shiny ERP system, you should try them out first. Unfortunately, this is not always possible if we talk about on-premises systems, but most cloud\/SaaS solutions offer a free demo. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">When testing the software try to make a simplified emulation of your product\u2019s production process which covers the use of features that are crucial to your business (test task). <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">After having tried to fulfill this task with the remaining ERP software vendors, you should have a clear winner and your next partner.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step_7_Customization\"><\/span>Step 7. Customization<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Assuming, that you have selected the software that seems to answer all your requirements and meets your budget, be prepared that you will have to adapt your business processes to a certain degree.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, you might still find that some important functionality is missing or is not working the way you expect, and changing your business workflow is not an option, then make sure that your vendor offers customization.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Knowing this in advance will help you better understand if the provider is flexible and what is the software TCO (Total Cost of Ownership).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Running a successful manufacturing business often means being able to adapt new technology fast to sustain strong competitive advantage.<\/p>\n","protected":false},"author":4,"featured_media":3598,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[90],"tags":[19,3],"class_list":["post-591","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-choosing-a-software","tag-erp","tag-manufacturing"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>7 Steps to Choosing the Right ERP for a Small Manufacturing Business<\/title>\n<meta name=\"description\" content=\"This short guide will save your time if you are on a hunt for a new manufacturing ERP. 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