ERP systems, which stands for enterprise-resource planning, are pretty much the heart and soul of every single modern company. They manage virtually every aspect of a business, from the sales and purchasing to the accounting and project management departments. Without them, a company is virtually unable to run smoothly without a massive, unnecessary manual exchange of information. Every single department needs to communicate with one another (for example, the production department of a company would need to know what the projected sales figures are for a particular time period in order to ease planning), and ERP systems make this possible with one unified solution.
The only thing is, ERP systems can be complex and expensive, and would be far beyond the budget of most smaller companies. ERPNext is an interesting ERP web app that takes much of the complexity out of ERP, and is more affordable to boot. Let’s take a look at it and see what ERPNext could mean for businesses looking for a better ERP solution today.
The 900lb Gorilla in the World of ERP
The problem facing many companies nowadays is that a proper ERP system is very expensive and difficult to implement. The market leader in these kind of systems, SAP AG, would cost a middle-sized company (so we’re talking fewer than 1,000 employees) around $10 to $20 million in software, hardware and consulting costs, something which can put a big dent in a company’s bank account. It’s not just the cost of the system itself, as many require dedicated servers and new computer architecture to be able to function properly.
So this is where ERP systems turn to the web. After all, why spend money on new servers when there are already plenty of them out there in the world? Web-based ERPs not only reduce a company’s overhead on hardware costs but also ease the setting up and implementation of such systems. ERP Next is the perfect example of this – a web-based ERP system that runs every department of a company with the minimum of fuss and maintenance.
Let’s take a look at it now.
Unlike many ERP systems, ERPNext is open-source and is designed for small to medium-sized businesses. It is based on wmframework which was built primarily for the system itself but also features plenty of customisation options (there’s even a page on their website dedicated to this).
ERPNext is available as a subscription option, which is currently priced at $299 yearly for up to 5 users. The unlimited users option can be had for $599 a year and if you need your own dedicated server and full open-source support, then this costs an additional $599 a year.
For this review, I will use the Demo version of ERPNext, which is available on their website for all to use.
When you first start up ERPNext, you are greeted with the Index page with icons for each individual section (or “module”, as they are known as) of the system. A toolbar runs along the top (which is accessible from each module in the system) giving you quick access to other modules as well as reporting functions and recent items used. As ERPNext is web-based, it can be used on a wide variety of devices (including tablets such as the iPad), meaning there are no issues with cross-compatibility (unlike most ERP systems, which are usually Windows-based).
As we’ve seen above, each individual section (or department) of a company is known as a module in ERPNext, so let’s take a look at a few important ones in a bit more detail.
With ERPNext’s accounting system, you can view your company’s chart of accounts and cost centres as well as a wide range of reports. There are also built-in tools (such as bank and payment reconciliation) to help you keep your accounts more organised and you can create invoices from purchase orders from this module as well.
In the demo system, the main currency used is Indian rupees (seeing as the developers are based in India). However, you can choose whichever currency your company uses. Reports can also be customised to suit your business needs as well.
The Selling module of ERPNext not only allows you to modify exactly what your company is trading but also has the ability to report on all your company’s sales as well as predictions for the next quarter based on previous results.
The Selling module also manages both existing and potential customers (including follow-ups on any offers sent), as well as quotations and some accounting aspects (for example, gross profit on sales).
Knowing exactly how much stock is in your company’s warehouse is extremely important, as it shows the sales department exactly how much they can sell to particular customers, and also helps with production planning (if the company manufactures its own products) or purchasing (if the company trades goods sourced externally).
In the Stock view, you can set up new warehouses and view each product in your database, along with its characteristics and aspects. If a particular product is running low, you can automatically create a purchase order from this view without having to go into a different module and you can reconsolidate stock (for example moving it to different warehouses) easily as well.
ERPNext tries to cut down your reliance (and costs) on other third-party software by providing a built-in to-do list, calendar and simple messaging service. You can share events with co-workers as well as track scheduled appointments and the messaging service allows you to send short messages and documents within ERPNext to other users of the system.
Summing it Up
ERPNext has really shown me that enterprise-resource planning systems don’t have to be really complicated, expensive affairs. I have good experience with working with SAP and I can tell you now – the learning curve is extremely steep and you can spend hours on end studying the system in detail and only touch the tip of the iceberg.
Owing to the sheer size of ERPNext, I couldn’t cover every single aspect of it in this review so the best way to try it out for yourself is to head over to the live demo on their website and have a play with it there. It’s simple, powerful and jam-packed full of features, and it will surely do your company wonders for the future.