When you are looking for exactly the right kind of software for your business to use, you will generally come across a few major types. It can be helpful to pick those apart so that you can work out which type you need and which you can probably ignore. Two of the major types that you have probably already come across are ERP and MRP. But what exactly are they, and what are the significant differences between them? Knowing this could help you make your decisions regarding the software, so it’s wise to know about it. Let’s take a look.
What Is ERP?
First of all, a couple of definitions. What exactly is ERP? Enterprise Resource Planning is a very common business software category and one that you have probably used all the time, whether or not you have been aware of it or called it this. ERP software is used by large businesses to keep a wide range of things under one dashboard: HR, CRM, accounting, and inventory management. It is a kind of all-in-one for all of these things. These systems also link to other office systems very effectively.
A major advantage of ERP is that you often have handy CRM bases to use, so your customer satisfaction is likely to go through the roof in no time at all. On the downside, however, ERP often has very high implementation costs and ongoing maintenance costs that can hold your business back considerably. That’s why a lot of businesses prefer to look for MRP systems.
What Is MRP?
An MRP is a Material Requirements Planning software. Essentially, it measures how much material you need, whatever that material might be in your instance, and when you are going to need it, so you can ensure that you are always procuring it at the right time. This ensures the highest possible production rate, and that’s one reason it is so useful for manufacturing businesses in particular.
In an MRP, you often have a Bill of Management material, which details what raw materials you need and how much. You’ll also have a dashboard for inventory management, ensuring that you always know exactly what is going on in your business. There might even be accounting features as part of the same software, along with some CRM features. A major benefit of an MRP system is that it gives you fantastic inventory control at a reasonable cost, improves your purchase planning and your production planning, and keeps your wastage low too.
Between the two, this is often the first go-to that you will want to consider, especially for smaller and medium-sized businesses. An MRP could be the difference between business success and failure, so definitely make sure that you look into this at your earliest convenience.
To find out more about MRPs and ERPs, contact your local provider today. You’ll find that they are more than happy to discuss with you the many pros of each.
Infographic created by DFIN, a financial compliance software company