The Ultimate Guide to Integrating ERP and eCommerce
ERP software helps businesses manage their core operations, including finance, accounting, HR, and supply chain management. ERP integration is the process of connecting an ecommerce platform with an ERP system. eCommerce integration with ERP allows businesses to automate many tasks related to order management, inventory management, and CRM (customer relationship management). eCommerce platforms and ERP systems are both integral parts of many businesses today. They are often used together to provide a complete holistic solution for businesses.
Integrating ERP with the ecommerce platform results in better data visibility and improved customer experience (CX) and certainly optimizes the sales environment within the digital commerce ecosystem.
According to Statista research, the global ERP software market has a stable value of about $100 billion per year as mid-size and enterprise-level companies widely have ERP systems and update them regularly. In this article, we share the pros and cons of ERP integration and discuss how to integrate ERP systems with ecommerce platforms smoothly.
Types of ERP
Two types of ERPs can be integrated with ecommerce platforms: real-time and non-real-time. Real-time systems are connected constantly to the database, while non-real time connects periodically.
- The first type of ERP that is modern enough is capable of exchanging data with the ecommerce system in real time. In practice, the response delay does not exceed 0.2–0.3 seconds. But for its part, the ecommerce software should also include an integration module that works in real time.
- Second, there are outdated types of ERP software that have probably existed in companies for decades and are rarely updated. Those ERPs can't handle requests from an ecommerce portal fast enough. In this case, the buyer may notice a hang in the ecommerce system while waiting for a response from ERP. To prevent this from happening, a B2B ecommerce solution + damping middleware are used.
Also, ERP software comes in two versions: on-premises and cloud-based. The former is the software you buy outright and install on your company's computers, while the latter (software as a service or SaaS) is subscription-based and accessed through the Internet.
In most cases, companies do not know in advance whether their ERP can be integrated with ecommerce in real-time. This requires running an audit by integration consultants and possibly developing a prototype of the integration solution to evaluate the speed of operation and error-free data transfer between systems. This happens when Virto's experts estimate the scope of the integration work and its cost and give you a deadline for this project.
Benefits of B2B eCommerce ERP Integration
ERP systems can automate various aspects of ecommerce, from order management to inventory control. The integration allows businesses to gain greater efficiencies, optimize operations, and save time and money while improving customer satisfaction.
Here, we offer advantages of ERP and ecommerce integration:
- Improved inventory management. ERP ecommerce integration automates many manual inventory management, warehouse, and logistics tasks. As businesses automate their order entry, fulfillment, invoicing, and accounting, the costs get reduced, and the overall efficiency grows.
- Streamlined order processing and fulfillment. ERP systems are tailored to automate the processes of taking orders, their approval, processing, and all the other steps, including fulfillment. When two systems are integrated, managing orders becomes easier, and all processes get transparent.
- Accurate financial reporting. Integrated systems exchange financial data quickly, which eliminates manual processing, consolidates data, and allows the making of informed decisions.
- Enhanced customer experience. The integration allows better tracking of customer actions and linking such analysis to the ERP processes. This allows managing offerings better and provides a unique customer experience.
- Increased efficiency. A more comprehensive view of customers, orders, inventory, and finances helps businesses make better decisions and improve their overall performance.
Other benefits include better efficiency, increased data visibility, improved CX and employee experience, increased sales, and customer loyalty are among the reasons you should integrate your ERP and ecommerce software.
Challenges of eCommerce ERP Integration
While ERP systems can provide many benefits when integrated with ecommerce, some limitations remain to consider while starting the integration process. Generally, they can be split into two categories: main limitations that can be easily avoided technically or by adding some necessary actions to the process, and the limitations of the modern ERPs and ecommerce systems that can lead to potential challenges and replatforming in the future. Let's dive into both.
Limitations of the integration process
- Increased complexity. Integrating ecommerce and ERP systems can add complexity to the IT ecosystem, leading to increased costs in the case of a long-time project for implementation.
- Data synchronization issues. Maintaining consistent and synchronized data between the ERP and ecommerce systems can be a challenge. It requires establishing robust data integration processes and ensuring that changes made in one system are accurately reflected in the other.
- Customization requirements. Depending on the specific needs of the business, customization of both the ERP and ecommerce systems may be necessary for effective integration. This customization can increase project complexity, implementation time, and costs.
- Implementation cost and time. eCommerce ERP cloud integration can be a significant investment in terms of cost and time. Businesses need to allocate resources for development, testing, and deployment, which can impact their budgets and timelines.
- Excessive mutual influence. Once ecommerce and ERP systems are integrated, it can be difficult to change or customize one of them. Modifications made to one system may have unintended consequences or require adjustments in the other system, leading to potential complications.
- Dependency on IT. Integration between ecommerce and ERP systems requires an IT team to support the solution. This can lead to increased dependency on dev resources and make it difficult to make changes without their help.
Drawbacks of the modern popular systems
The most popular ERP systems include SAP ERP, Oracle ERP Cloud, Microsoft Dynamics 365, NetSuite ERP, and more. The popularity of these ERP systems is often a result of their robust functionality, extensive customer base, and proven track record of successful implementations. While offering great capabilities for ERP processes, these systems can be outdated or complex and difficult to integrate with modern ecommerce systems.
Using outdated solutions, either ERP or ecommerce software, can lead companies to poor process optimization and the inability to innovate. For example, large SaaS systems frequently chosen by businesses usually do not support quick changes to upgrade one part of the system, you have to pause all processes and implement it as a whole. Sometimes, the mistake that becomes obvious in two or three years leads to the decision on replatforming. This is the moment when companies should be particularly careful not to choose the same outdated system but to implement the new modular one that helps companies to break free of the constant replatforming and start growing.
Best Practices for Successful B2B eCommerce ERP Integration
In the modern reality, building an ERP system is not that hard. Once you identify the specific needs of your business and what you hope to achieve you are ready to go. The next step is building a strong ecosystem of solutions to provide you with exceptionally good processes and results. ERP integration for ecommerce is an essential step in building such a system. Once you clearly understand your goals, you can begin your integration journey:
1. Order an audit.
Check which ecommerce platforms and ERPs are compatible. Otherwise, data compatibility issues could require additional coding to create a middleware layer to resolve such issues.
2. Define integration requirements and responsibilities.
It is important to define the specific business requirements: ensure your potentially new ERP system or ecommerce platform supports all the needed tools and offers features that make it possible to integrate two systems together or link them to some third-party solutions. So all that you have to do is to realize which tools would play which roles.
3. Build the integration using API middleware.
Most of the modern tools are already tailored to get connected via application programming interface (API). Your ecommerce system and ERP software must be able to communicate with each other and exchange tasks and data seamlessly. In case correct middleware is chosen, the process of integration will take no more than just a few weeks.
5. Launch your ERP integration with ecommerce.
Once the ecommerce and ERP systems are integrated, it is important to ensure it is working properly before letting your customers use the service. This can help avoid potential CX problems and customer frustration down the road.
When choosing an ecommerce platform, the most important thing is to consider its ability to integrate with your existing ERP system. That’s a fundamental question that any B2B ecommerce vendor should answer during the RFQ process.
The Virto team always gets this question during the qualification stages from our potential customers. Our Virto B2B eсommerce platform can support ERP integration in real-time and asynchronously, depending on the ERP I/O (input/output) capabilities. And it doesn’t matter if it is a legacy or the most advanced modern ERP system. The integration is possible thanks to our innovative Virto Atomic Architecture™.
Case Studies of ERP + eCommerce Integration
Coca-Cola integrated its ERP system (SAP) with its ecommerce platform to optimize inventory management. They aimed to create a seamless flow of information and data between its ERP system and ecommerce platform. As a result, Coca-Cola was able to optimize inventory management, automate order processing, and deliver an enhanced customer experience.
Dell went through integration to enhance order management and customer experience. They wanted seamless order processing, inventory tracking, and real-time updates on order status. Dell achieved improved order management, enhanced customer experience, and increased operational efficiency. The integration allowed for real-time inventory visibility, streamlined order processing, and centralized data management, resulting in smoother operations and better customer satisfaction.
4. Proffsmagasinet ERP integration with Virto
Proffsmagasinet is one of the biggest ecommerce companies in Sweden that provides tools, laser and measuring apparatus, and other equipment. The company needed a new ecommerce system for easy integration with ERP. As Proffsmagasinet already has its online store working, the integration had to be as smooth as possible. The Virto Commerce team provided the solution to integrate two systems seamlessly. First, they created a flawless work process identical to the existing one, then moved everything to the newly integrated cloud version of Virto Commerce Enterprise and ERP systems. As a result, the company improved the compatibility of the main features, got an opportunity to update small modular pieces separately and update, analyze, and track their ERP processes easily.
Integrating your ERP system with an ecommerce platform can be a complex and costly journey. However, the benefits of such an integration can be significant because ERP integration provides a complete view of customers, orders, inventory, and financials.
In addition, ERP integration (ecommerce) can help to improve efficiency and accuracy by automating tasks and eliminating manual data entry. Integration can also help businesses gain a competitive edge by providing customers and partners with more accurate and up-to-date information.
There are several factors to consider when deciding whether or not to integrate ERP with ecommerce, including
- Cost of upgrading ERP software (if required)
- The complexity of the integration process and associated costs
- Future-proof capabilities and readiness for innovation
If you are considering ecommerce and ERP integration for your business, Virto Commerce can help. Our platform is designed to support seamless integration between ecommerce and ERP systems. Contact us to learn more about how we can help you achieve your goals.
FAQ about ERP and eCommerce Integration
Which ERP systems can be integrated with Virto?
Virto Commerce platform is designed to support seamless integration with any ERP system available on the market, including legacy systems. Basically, Virto can integrate with any solution via API.
Why integrate ERP and ecommerce?
Integrating ERP and ecommerce systems can provide the following benefits:
- improved efficiency,
- increased visibility,
- better decision-making,
- and reduced errors.
Streamlining processes and automating routines allow faster, more transparent, and more efficient operations.
How can businesses ensure a successful integration of ERP and ecommerce?
Carefully plan the integration process:
- understand your business requirements and objectives,
- select compatible software systems,
- ensure data consistency and accuracy,
- and provide appropriate training to employees.
Choose experienced integration partners only that can provide high-quality guidance and support throughout the process.
What data is typically integrated between ERP and ecommerce systems?
The data that is integrated between ERP and ecommerce systems can vary depending on the specific needs of the business. However, some common data that is integrated includes customer information, order data, product information, inventory levels, shipping and tracking information, and financial data.
Can ecommerce integration with ERP be customized to meet specific business needs?
Yes, if ERP and ecommerce are both customizable. For example, with Virto, you can customize the integration to handle custom data fields, workflows, and business rules. This is the way to ensure that the solution meets the unique requirements of the business.
Does ERP and ecommerce integration support multi-channel selling?
Yes, ecommerce website integration with ERP can support multi-channel selling. You can sell via online marketplaces, social media platforms, and physical stores. In case the integration was made with Virto, multiple marketplaces are also available.
Is ERP and ecommerce integration scalable for growing businesses?
Yes, ecommerce integration with ERP can be scalable for growing businesses, but it depends on the systems chosen. Many ERP and ecommerce platforms offer flexible configurations and scalability options. However, some outdated solutions are hard to scale, so it is crucial to choose modern modular future-proof solutions, for example, Virto Commerce.