Logistics & ops
/ 14 minutes
Dov Quint
Feb 20, 2025
One of the biggest challenges of running a Shopify business is making sense of your data. Marketing and sales activities, supply chain operations, and other processes all generate data, but these insights are scattered across various platforms and departments.
The result? Data silos and disconnected systems that may hinder productivity and growth.
One way to solve this issue is to implement a robust Shopify ERP solution.
Enterprise resource planning (ERP) systems bring all your data under one roof, leading to higher efficiency and better decision-making. Depending on their features, they can also automate routine tasks, optimize your inventory, and streamline compliance with tax laws and industry standards.
To reap the benefits, you must first connect your ERP system to Shopify and other apps, databases, or software programs you use.
That said, let’s break down the ABCs of enterprise resource planning systems, including their types, key features, and strategic benefits. We’ll also show you how to integrate your ERP into your Shopify business to streamline inventory management, customer service, and other activities.
A Shopify ERP system is a software solution that helps Shopify businesses manage their key operations, from HR and accounting to marketing, sales, and inventory management. Basically, it provides a unified view of your data and processes, allowing information to flow between departments.
Shopify doesn't have a built-in ERP system, so you must choose one that integrates seamlessly with your e-commerce business. Some examples are Odoo, Oracle NetSuite, and SAP ERP.
This type of software acts as a company's central nervous system, centralizing and connecting your processes. Since it operates in (or near) real-time, it ensures immediate and accurate insights.
ERP systems fall into four different categories, depending on their deployment environment. These include:
On-premise ERP: These software programs are installed on a company's servers. They require a larger initial investment than cloud or hybrid ERP systems but can lead to significant cost savings over time. Plus, you can customize them as you see fit and keep all your data in-house.
Cloud-based ERP: The software resides on the vendor's servers and can be accessed remotely. This option is cheaper and more convenient than deploying the ERP on-premises, but you'll pay a monthly or annual fee.
Hybrid ERP: If you go this route, you'll deploy the ERP system both on your servers and in the cloud. Hybrid ERPs are easier to scale and offer more flexibility than cloud-based ERPs, appealing to organizations with very specific needs. A potential drawback is their high maintenance cost.
Two-tier ERP: This option involves running ERP systems to address the needs of enterprises undergoing a merger, expansion, or acquisition. Or those with multiple locations across the world.
Each type has distinct advantages and drawbacks, and choosing one depends on your specific needs. For example, cloud-based ERPs are a viable choice for small- and medium-sized businesses. Hybrid ERPs, on the other hand, are better suited for large companies with complex needs, such as those managing multiple warehouses or using legacy systems that require integration.
ERP systems vary in cost, functionality, scalability, features, and other characteristics. For instance, some can automate entire workflows and streamline complex supply chain operations. Others are more basic but easier to implement and use.
For starters, look into ERP systems that integrate with Shopify. Compare them side by side and choose one with the following features:
Since Shopify operates in the cloud, it makes sense to choose a cloud-based ERP system. This approach will allow you to effortlessly connect and manage your data while simplifying ERP implementation.
Some ERP platforms are difficult to use and navigate, preventing the average business owner from leveraging their full potential. One reason is that they integrate many processes into a single system or have advanced features designed for teams with a high level of technical expertise.
Given these aspects, look for ERPs with user-friendly interfaces and reliable technical support, such as Acumatica, Brightpearl, or Scipio ERP.
For instance, Acumatica’s intuitive, easy-to-navigate interface and role-based customization options can reduce the learning curve needed to customize, use, and manage the software.
The best ERP systems can automate order processing, financial reporting, inventory management, and other core business operations.
For example, automated systems use AI to analyze past sales data and forecast inventory levels, preventing issues like overstocking or understocking. They can also reduce or eliminate human error by automating accounting processes.
Choose an ERP platform that offers the tools you need to monitor stock levels, incoming orders, deliveries, and other inventory management processes. This will ensure full visibility into your supply chain and help you identify bottlenecks.
With an ERP e-commerce integration, you gain insight into customer behavior, preferences, and interests. Just make sure you choose an ERP system with built-in CRM features.
Not only is this option more affordable than using a separate CRM system, but it can also simplify your operations. By eliminating the need for multiple databases, it bridges the gap between marketing and sales and can improve collaboration across departments. Plus, it ensures data consistency and streamlines reporting.
Some ERP platforms incorporate order management systems (OMS), allowing for multichannel order processing, inventory management, workflow automation, and more.
These features enable companies to improve production planning, track orders in real time, and provide timely deliveries, among other perks. Over time, they can reduce your operational costs and boost customer satisfaction.
All ERP systems have built-in analytics tools, but their capabilities vary from one platform to the next. Choose a system that gives you actionable insights into sales trends, campaign performance, operational efficiency, and related areas.
For instance, some ERPs feature predictive analytics tools that anticipate product demand, enabling businesses to optimize production planning. Others can generate heat maps, graphs, charts, and other visual tools to help you better understand your data.
Look for a cloud-based ERP system with finance and accounting functionalities, such as the ability to automate accounts payable and receivable processes.
This software can make it easier to forecast and optimize your cash flow, create and manage budgets, and process transactions in different currencies. At the same time, it can reduce or eliminate human error and simplify tax compliance.
Netsuite and other cloud ERP solutions let you access your data on the go. This makes them ideal for business owners who travel frequently or work remotely.
Mobile ERP systems have the same features as traditional ERP platforms but offer increased functionality and convenience. For example, you can opt to receive real-time notifications of new orders, shipping updates, or low-stock situations.
Invest in an ERP system you can scale up or down as your business needs change. Make sure it can accommodate more users and provide additional insights as your company outgrows the startup phase or expands its operations.
The best ERP solutions can run into the six figures, depending on their features, deployment environment, integrated systems, and other factors. Those aimed at small businesses cost around $1,740 per month, or $20,880 per year. The higher the number of users, the more you can expect to pay.
If you're on a tight budget, consider using an open-source ERP system. This option is free or low-cost but involves a steeper learning curve than proprietary ERP solutions.
Alternatively, look into cloud-based ERP platforms, which are less expensive than on-premise, hybrid, or two-tier ERPs.
Integrating Shopify with an ERP can be more or less complex, depending on the features you need and whether you opt for a cloud-based or hybrid ERP system.
For starters, look into Shopify's Global ERP program, a platform that connects merchants with leading ERP providers like NetSuite and Microsoft Dynamics 365. The ERPs available on this platform integrate seamlessly with apps in the Shopify App Store, eliminating the need for third-party implementations.
Let's look at a few examples:
NetSuite ERP Connector: This ERP integration tool will sync your inventory, sales, product, and customer data with Oracle NetSuite. It features advanced tools for financial management, inventory control, and multi-location operations, making it easier to scale your business.
Brightpearl: Designed for growing retail and wholesale businesses, Brightpearl automates complex tasks like order fulfillment, inventory management, and accounting. It also offers real-time insights into sales performance and inventory levels across multiple channels, enabling vendors to efficiently manage high order volumes.
Microsoft Dynamics 365 Business Central: As part of the Microsoft ecosystem, this ERP provides a unified view of supply chain, financial, and sales data. It appeals to small and medium-sized companies, offering the tools you need to scale up.
Acumatica Cloud ERP: Acumatica's native integration with Shopify allows vendors to automate order management and fulfillment, update inventory levels across multiple warehouses, and run their businesses on the go.
Infor eCommerce Connector: Infor's ERP software is designed for industries with complex workflows, such as manufacturing and distribution. It can also be a good choice for Shopify Plus merchants and other high-volume businesses. Its advanced automation features and data synchronization capabilities enable users to optimize every stage of their supply chain.
Except for NetSuite, these apps are free to install — though some of their features come at a price. The challenge lies in setting them up and making the proper configurations for a seamless Shopify integration.
For a smooth integration, you'll likely need support from a developer or the software vendor of your choice.
According to a 2023 survey of 1,500 retailers, manufacturers, and distributors, companies that hired a software consultant to help them with ERP implementation reported an 85% success rate. By comparison, those who took a DIY approach or got free assistance from ERP vendors achieved a 67% success rate.
However, there are steps you can take on your own to minimize disruptions during the transition process. Follow these best practices to ensure everything goes as expected:
First, gather your team to discuss why, how, and when you'll integrate Shopify with an ERP system. Define your goals, assess your IT infrastructure, and determine which manual processes you can automate.
Next, go over each step of the integration process, from cleaning up your data to defining workflows and testing the system. Also, decide how you want to go about it.
For example, you can use Shopify's application programming interface (API) or a third-party tool to integrate your data into the ERP. Most ERP systems also have built-in tools for accepting data from external apps like Shopify.
This approach involves gradually implementing a new system to mitigate risks. Basically, you break down the integration process into smaller, more manageable steps within a given time frame.
A phased roll-out allows you to test each module or feature at a time before progressing to the next. This way, you won't have to start all over if something goes wrong. Plus, your team may find it easier to adapt to the new system.
For reference, small and medium-sized businesses need around three to nine months to make the switch. Larger companies, on the other hand, take around six to 18 months.
Let your employees, vendors, and business partners know about the changes you plan to make. Explain how the transition will impact them — and why you made this decision.
For instance, you'll want to keep your suppliers in the loop so they don’t use outdated practices, such as relying on old inventory updates. Otherwise, you might face stock discrepancies, payment issues, missed shipments, or delays in order fulfillment.
Also, train or upskill your staff as needed. Make sure they know how to use the ERP with Shopify to track orders, collect customer data, forecast sales, check inventory levels, and so on. If you need training and support, most major ERP vendors offer it.
Determine how you're going to measure ERP implementation success. Establish key performance indicators (KPIs) that make sense for your business, such as:
System adoption rate
Order processing time
Inventory accuracy
Operational efficiency
Downtime
Customer satisfaction
Return on investment (ROI)
For example, a successful ERP integration can help reduce the time from order placement to fulfillment. This aspect alone could improve operational efficiency and customer satisfaction, leading to a higher ROI.
Once the ERP is up and running, monitor and optimize it to ensure it works properly. Use online tools like PRTG or ManageEngine Applications Manager to detect performance issues in real time.
It's also a good idea to perform regular data backups and have a contingency plan. Like all software programs, ERP systems can encounter security glitches and other unforeseen issues.
Shopify ERP integration solutions provide a single source of truth for data, leading to more efficient business operations. At the same time, they reduce manual processes, which can minimize errors and boost productivity.
According to advisory firm Technology Evaluation Centers, most companies cite improved collaboration, faster processes, and a centralized data system as the top three benefits of ERP implementation.
According to Panorama Consulting Group's 2024 ERP Report, nearly half of organizations improved most of their business processes after implementing ERP software. The report highlights that organizations increasingly embrace continuous improvement across multiple processes rather than focusing on just a few key areas, recognizing this as essential to staying competitive.
With that in mind, let's look at the benefits of ERP systems for Shopify brands.
For midsize businesses, the cost of ERP ownership is around 3–5% of their annual revenue. This may seem like a lot of money, but the savings are worth it.
An ERP can help Shopify companies — and most other businesses — reduce operational costs and improve resource allocation. This software solution can also improve financial planning by enabling users to forecast sales, monitor their expenses, and identify cost-saving opportunities.
Nearly 45% of the companies surveyed by Panorama Consulting Solutions experienced higher productivity and efficiency after implementing an ERP. Around 18% said the ERP system helped them standardize their operations.
Automation, one of the key ERP features, reduces the time spent on mundane, repetitive tasks, such as invoicing and order processing. This aspect alone can streamline your processes and improve data quality, resulting in higher efficiency.
With an ERP system, Shopify businesses can monitor stock levels across multiple locations in real time. You can also automate reorders and sync inventory data with sales channels, leading to better inventory management.
As discussed earlier, some ERP platforms have built-in CRM systems. This means you can use your ERP to manage customer interactions at every stage of the sales funnel.
Let's say you run a dropshipping business. A modern ERP system would allow you to sync inventory updates from suppliers to Shopify. If a supplier no longer has a product you sell, the ERP will update your stock levels accordingly.
Thanks to this feature, you'll avoid stockouts, shipping delays, and other issues that can put off your customers. Plus, you can use your ERP to automate order processing and ensure a seamless shopping experience.
ERP integration with Shopify will bring all your data together while enabling advanced predictive analytics.
These insights can reveal what products are in demand, how much you can expect to sell, and the areas where your sales pipeline is falling short. Act on these insights to improve your ROI, optimize your processes, and cut unnecessary expenses.
A robust ERP system can improve vendor management and supplier relationships by:
Consolidating vendor data, such as contracts, product catalogs, and contact details. This allows you to better organize the vendors you rely on and have their information at your fingertips.
Automating invoicing and other financial processes. For example, you can configure it to automatically match invoices to purchase orders, resulting in timely payments and better cash flow management.
Allowing users to directly engage with suppliers without the need for a third-party app. This feature facilitates communication and can speed up problem resolution.
The best ERP platforms consolidate data from sales, inventory, marketing, and other business functions into one centralized system. Shopify merchants can leverage these insights to:
Optimize inventory levels
Create production plans
Improve production schedules
Develop more effective equipment maintenance plans
Budget their expenses
Plan product launches
Predict supply and demand
The insights you can gain from an ERP system depend on its features — and your company's data.
A basic ERP won't include advanced analytics and marketing data or integrate with third-party platforms, such as your CRM or vendor management system. However, it can still be a good choice for startups and small enterprises. Just make sure you choose a scalable ERP solution to support your growing business needs.
Choosing an ERP system that meets your needs isn't easy, given all the options available. Integrating it with Shopify poses further challenges, such as the high implementation costs and the risks associated with data migration.
Once installed and configured, an ERP can streamline your operations and drive business growth. The downside is that it takes time to reap the benefits.
In the Panorama Consulting Solutions survey, 37% of companies reported tangible benefits 13 to 18 months after transitioning to an ERP. Another 13% said they waited 19 to 24 months to see improvements in their processes.
Feel like you can't wait that long? Perhaps you want to start a new venture? Then it might be time to sell your Shopify business.
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Fill out this form to request an offer and see how we can help. The entire process is hassle-free so you can get a smooth exit and have peace of mind knowing that your business will thrive.
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