E-commerce SaaS tool or ERP, Which system is better?

In order to better realize the system for realizing online transactions based on e-commerce, we distinguished the two systems of e-commerce SaaS tools and ERP systems in order to identify the differences between the two. They have their own advantages and disadvantages. A better distinction between the two allows companies to better choose their own suitable tools.

1. What are the e-commerce management system and ERP system?

The e-commerce management system is a system that guarantees the realization of online transactions based on e-commerce, including currency exchange, supply chain management, online shopping and marketing management, online transaction processing and automatic data collection systems.

ERP system is a software tool used to manage enterprise data. The ERP system helps different organizations deal with the various departments of the enterprise. It is responsible for the information integration of inventory management, customer order management, production plan management, logistics and transportation management, and accounting management.

The ERP system integrates all the databases of the entire department into one database, which can be accessed by all employees of the enterprise.

2. What is the use of the ERP system?

Running a business requires taking into account all aspects of finance, operations, sales, and marketing. The ERP system aims to merge these four aspects of operations and processes into one system. The ERP system can help us track, share and store information among various departments, and ensure that all employees can see the same data and information.

Popular ERP systems such as NetSuite, Oracle, SAP and Microsoft Dynamics are traditional business management systems with accounting management as the core. In order to keep up with the trend of e-commerce, e-commerce solutions have many integrations, such as: Warehouse Management System (WMS).

  • Order Management System (OMS)
  • Inventory Management System (IMS)
  • Supply Chain Management (SCM)
  • Product Information Management (PIM)
  • Product Lifecycle Management (PLM)
  • Customer Relationship Management (CRM)
  • Business Intelligence (BI)
  • Customer Experience Management (CX)
  • Human Resource Management (HRM

3. Challenges faced by ERP software in e-commerce business

ERP software itself is not tailored to a specific industry or line of business, so the quality of e-commerce integration is usually lower than expected. They are built on old technology and cannot keep up with changing market demands or the level of innovation regularly provided by e-commerce management systems.

Most ERPs are built for back office. They are not suitable for customer-oriented websites like online stores that require additional data conversion and real-time analysis.

The entire multi-channel business is linked to such an inflexible system, and companies may face the risks of platform non-compliance, incorrect product listing information, and other errors. These risks will cause companies to lose the right to sell on Amazon and other markets.

ERP software deployment requires a lot of financial and time resources. In addition to the annual subscription fee, companies may also face installation costs and after-sales costs of up to several hundred thousand yuan. In addition, it may take 1-2 years to fully deploy the ERP system. If it is not handled properly, it will disrupt the current business process

4. What is the use of the e-commerce management system?

In short, an e-commerce management system allows companies to list products for sale and accept payments online. However, most online businesses usually require more than basic functions. The e-commerce management system also adds other business management tools.

The best e-commerce management system has all the basic tools needed for enterprises to get started in the e-commerce field, as well as upgrade tools and platform ecosystems that enterprises can use as their business grows.

5. Different type of e-commerce management system

There are three main types of e-commerce management systems

  • Software as a service (SaaS) and platform as a service (PaaS)

Both the e-commerce SaaS system and the e-commerce PaaS system provide e-commerce business solutions via the Internet. E-commerce SaaS will provide solutions through software and become e-commerce PaaS after hardware is added.

For companies that lack technical personnel, e-commerce SaaS systems and e-commerce PaaS systems are the simplest and most straightforward choices. If you need to add custom features, you may need some developer skills, which can be achieved through outsourcing, so it’s not a big problem.

Developers of e-commerce SaaS systems and e-commerce PaaS systems will deal with patches, updates, and new feature development, so companies don’t have to worry about not keeping up with business development after product purchase or not having technical support after encountering problems.

  • Localized software deployment

Localized deployment refers to the installation of the customer service system directly on the local server after the enterprise purchases hardware equipment independently. The main difference between localized deployment and SaaS cloud deployment is whether the customer service system needs to be installed on a local server. On-site professionals will fix any problems, add new features and perform manual updates.

If the company has its own IT team, then this kind of software is the best choice. It allows companies to gain more control over the site and create their custom storefront solutions

  •  Function expansion API of e-commerce SaaS system and ERP system

At present, there are many API functions on the market that integrate third-party products. They provide various functions for enterprises to expand their functions without conflicting with existing functions and business processes. It is more friendly to ERP software and e-commerce SaaS software, and can also be used independently.

Take the Express 100 logistics information query API as an example. It is suitable for ERP function expansion and e-commerce software function expansion. Merchants do not need to connect dozens or hundreds of express companies by themselves. After accessing the express 100 API, they can manage data through one account. Thousands of express companies’ logistics query, electronic face-to-face single order, logistics delivery, logistics order number and product order number match back and so on

6. Conclusion

When investigating which ERP or e-commerce management software is better, we will eventually find a tool evaluation website that compares features, advantages, and prices. Therefore, product options can generally be divided into two categories:

  • All-in-one platform, such as supply chain management platform, ERP software, e-commerce SaaS software, etc.
  • Dedicated inventory management, marketing software, etc.

The all-in-one solution may sound tempting because it provides “full process” management in one interface. The inventory management software is only suitable for specific scenarios, but it can be integrated with various other e-commerce SaaS services and other functional APIs.

Companies usually choose to use integrated software or ERP software, because these software allow companies to manage all processes in one place.

However, because the integrated software only focuses on managing so many things at once, the integrated software usually lacks the granular level functions required to completely handle the inventory and logistics processes like the e-commerce management system.

56Tech has developed both the ERP system and the e-commerce SaaS. If you are still confused about which one to choose or have a need to customize and develop related systems, please contact us. Call us: 400 186 0061(China) or send an email to: lynn.li@dreamlot.com.

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