How to Find the Ideal Shopify ERP as a Growing Manufacturer
Tread carefully, for the choice that lies ahead will change your product-making business forever.
Shopify ERP can make a monumental difference to the way you run your online store as well as the way you operate daily.
The advantages are there for all to see. ERPs are systems which cover aspects across a manufacturing business – inventory control, production scheduling, supply chain management, sales forecasting, core finances and sometimes even HR.
They are designed to become the foundation for your entire business. From syncing your Shopify sale orders with your inventory to managing your accounts.
Once you’ve got the ball rolling, you’ll spend a lot less time on Shopify and even less time trawling through spreadsheets.
So, where do you start when looking to find the right fit as a small manufacturer?
It’s not likely that advanced features like HR management are going to be your priority.
The first question you need to ask yourself is which problems need solving?
Of course there as many answers to this question as there are Shopify stores. Instead, let’s focus on the elements that matter the most to product-making businesses.
1. Shopify ERP integration
Okay, so we mentioned that every business’ needs are different when searching for Shopify ERP, but there’s one key feature every maker needs.
It’s going to make a huge difference to your workflow if your stock and orders are synced up between your ERP and Shopify store. You will have a real-time view of what’s going on so that you can make fast decisions.
For example, if you spot that materials are not available for a particular order, then you can preemptively let the customer know of the delay and do some damage control.
Or if you find yourself with more of a product that’s gathering dust in your stock room you can quickly set up promotions on Shopify to move them on.
Without Shopify integration, an ERP is going to be of limited value to you.
But again, you want to make sure the software already provides this. Otherwise, you’re going to have to pay for them to add this integration and fatten up your bill. Plus, you would need to upgrade to the Shopify Plus plan so that you get access to their API to be able to do this in the first place.
We’re sure you’ve already seen how expensive ERP solutions can be.
So, make sure to purchase wisely here and find a tool that has been designed for Shopify users.
2. Inventory Management
As a product-making business managing inventory is going to be one of the highest mountains you need to climb.
Especially because Shopify’s inventory management capabilities are so limited. You can’t manage product recipes, raw materials, and you are always at risk of human error with all the manual inputting involved.
That’s why you want to make sure that you look for a Shopify ERP that is going to manage these elements and ultimately get your stockroom to optimal inventory levels.
These are the key features to look out for:
It’s a coincidence that they all start with the letter ‘R’, but it certainly makes them easy to remember. And you don’t want to forget them either.
By combining all these elements in tandem with your Shopify store you can be sure that you never have too much or too little stock.
Because too little and your customers are going to be waiting on late deliveries, and too much leads to bloated carrying costs.
Smart inventory management is one of the biggest benefits a Shopify ERP can offer. Make use of it.
PRO TIP: If you’re just starting out with your inventory management and not sure where to start, then check out our manufacturing inventory spreadsheet template.
3. Production scheduling
Shopify doesn’t offer much when it comes to the manufacturing side of things.
Not that it should. But tools that help with production can help you a lot if your workshop is running all clunky and clumsy like.
Scheduling production is mainly a matter of tracking your manufacturing and then making sure that you’re planning it out as efficiently as possible.
That means that you need to know your material availability and be following production statuses so that ultimately you get accurate completion times.
It so often happens that a workshop gets used to bad practices and gets stuck in a loop of inefficiency without realizing.
So, when searching for that pitch-perfect Shopify ERP look for a manufacturing module which tracks:
A system which can take control of all these elements is going to be a game-changer for any product-making business, but especially if your focus is on Shopify.
That’s because you’re going to have a lot more time to spend on marketing your store instead of dealing with workshop grime and spreadsheets.
Ideally, you want to be in a situation where everyone knows what they need to be working on at any given time and that the table is set for them to do it.
This way you can ensure that your workshop runs like clockwork.
Knowing when to purchase materials is the bane of many of our lives.
Most of the time businesses deal with this issue by overzealously over purchasing. Sadly, this usually ends up with a shelf of dead stock or at least a room of tied up assets.
And what happens when you’re out of materials for an order and it gets pushed back a couple weeks. A whole load of “sorry” to the customer is what. That’s no good.
That’s why it’s important that your Shopify ERP is going to indicate when you need to be making purchases. We already mentioned reorder point when it came to inventory management and that’s a great starting point.
Another buzz word to look out for is safety stock. It’s essentially a way of making sure that you always have a certain amount of materials and product lying around so that when you are getting close, you’ll quickly recognize to purchase more.
There’s a lot of efficiency to be gained here. And not to mention the headaches saved in working out when to buy in more materials.
Don’t skimp out on this one, no matter what business you’re running.
Maksense creates smart tools for laboratories in both make-to-stock and make-to-order varieties. Purchasing materials was once one of their greatest daily challenges.
Once they adopted Katana Shopify ERP they managed to overcome this by:
- Automating their raw material management;
- Intuitively prioritizing orders; and
- Removing reliance on confusing spreadsheets.
Shopify has a solid analytics tab which provides you with sales, discounts, and refunds tracking. However, as useful as these stats are, they don’t come in so handy for your accountant.
One of the reasons for that is there is no cost of goods sold.
That’s a financial metric which is a requirement when producing accurate tax statements. Having these kinds of elements produced by your Shopify ERP might save you and your accountant a whole load of headache, as well as giving you a more accurate view of expenditure.
Nowadays though many product-making businesses have been turning to cloud accounting software like QuickBooks.
Accountants themselves have accepted this major cultural shift in accounting.
Makes sense too.
They’re quick, cheap and easy to use.
The most ideal scenario is to find a Shopify ERP that integrates with a dedicated cloud accounting software.
It’ll save money on having one developed for you, as well as giving you access to some of the most progressive and fast-moving accounting software on the market.
PRO TIP: You can find yourself plenty of accounting software options in the Shopify app store. But that’s not the only thing apps are useful for.
Check out our list of Shopify Apps for Small Manufacturers for ideas.
6. Ease of use
This one is hard to pin down because you don’t know how the software is going to work for you until you try it. And not too many ERPs offer trials, so when you get the chance, be sure to take them up on it.
The whole reason for adopting a Shopify ERP is to make your life simpler, but if it’s not easy to use, then what’s the point?
Visual cues and a smooth interface are solid points to start from when taking in these considerations. 65 percent of us are visual learners and considering you’ll be spending more time on your ERP than Shopify makes this element a no-brainer.
Also, look into the number of modules you are going to be working with. Don’t be fooled into thinking multiple modules and dashboards are a good thing.
If anything, you want the interface to be as streamlined as possible. One dashboard is ideal.
An easy to follow Shopify order management system.
But again, we know how difficult it can be to get an insider look on Shopify ERPs, so trial runs should always be the first port of call.
Otherwise, get talking to similar businesses who are using the software for references on how the systems run and whether the ERP offers sufficient support.
At least then you’ll know then that you got reinforcements if you start finding holes in the ship.
Master of Shopify ERP Software?
There’s no question that finding the right ERP is a quest of epic proportions.
So many factors to take into consideration. And there are so many options available out there with features that go beyond what we’ve listed here.
But again, to simplify the journey you want to ask yourself: what are my most common problems?
All those bells and whistles that ERP companies are going to offer you might seem brilliant at first, but unless you are a large-scale manufacturer, they are unlikely to be of much use to you.
The common problems that smaller product-making businesses face are usually more defined and easier to pinpoint.
Katana is a manufacturing ERP software which has been designed for the smaller manufacturer by focussing on their specific issues.
It’s an all-in-one solution that merges inventory, purchasing, manufacturing, and sales together. Of course, that includes a seamless Shopify integration designed for the maker’s eye.
If these are some of the main problems that you need solving, then it might well be your ideal solution:
Shopify orders getting delayed or lost;
Overloaded with spreadsheets;
Inefficient inventory, whether that be over or under stocking;
Struggling to track raw materials;
Not knowing when to purchase more materials;
Messy production schedules; and
Wasting time writing out invoices.
Getting a tinge in your stomach reading these lines?
That’s a good sign that the problems outlined here are what you are looking to solve in a Shopify ERP.
It may well be getting to the time for you to start trying it out because it just so happens Katana offers a 14-day free trial.
So, even if it’s not the right fit for you, at least you’ll quickly find out what is!