Do you feel that excel sheets are unable to keep track of the vast amount of inventory you have right now? Or do you have multiple software in place do manage different parts of your business? As businesses expand, there comes the need to invest in an ERP system for all operations in your company to be managed easily on one single platform. With that in place, human errors can be reduced, real-time notifications can be received, and data from every department can be integrated into one. In this article, we will be sharing with you some factors to keep into consideration deciding whether to buy or build an ERP software for your company.
Build an ERP software
1. Pros of buying an ERP software from a vendor
- With so many choices in the market, buying from a vendor gives you the opportunity to test their software to see if it fits your company’s operations and whether it is what you are looking for. Since getting an ERP software is not a small investment, it is vital to test every function and aspect of the software beforehand.
- The vendor has a stable knowledge base of the whole system and will be able to provide a full range of support for your company during and after the implementation process. In the event that problems occur after the implementation process, assistance will still be there for you.
- Since the vendors are the experts in this field, they will keep up with the latest trend and upgrade their software as technology evolves. This is not only for them to stay ahead among their competitors, but for you to also stay ahead of your rivals.
- If you have a tight timeline to have an ERP system in place, we would suggest buying. With the software already ready, implementation can be done around 4 – 5 months for a standard ERP software as time is still needed for users training, data migration, test run and, etc. However, if modifications have to be done to the current software, it can take up to one year, which is still faster than building an ERP software from scratch.
- The cost of buying is most probably lower because the software is ready. In addition to that, the Singapore government has also introduced a few government grants to assist businesses in the digitization process. Companies buying the software from a PSG pre-approved vendor will be eligible for up to 70% funding from the government to keep their cost affordable. With that subsidy, I can say that the price is even lower right now.
- While some vendors only provide a standard ERP software, there are other vendors who are able to do customization and even more, heavy customization for businesses on top of their standard software. Hence, do let them know upfront if you know you have specific requirements.
2. Cons of buying an ERP software from a vendor
- There will not be any flexibility to amend or make changes to the functions of the software as and when you like. In the event that some modifications are needed after a year or so, there will be an additional cost for the company to engage the vendor for modifications.
Buy an ERP software
1. Pros of building an ERP software by yourself
- The software built will be a perfect fit for the company as it will be built based on the most specific requirements of the company. Also, new functions or features can be built as and when it is needed.
2. Cons of building an ERP system by yourself
- There is no chance to test the software. Unlike buying, the system is not ready and can only be tested once everything has been developed completely. If there are some modifications or improvements that have to be made, more time will be needed to perfect it.
- It is more costly to develop the software in house as a few experienced ERP software developers are required. The sum of their salary for a year or more will most probably exceed the cost of buying an ERP system from a vendor.
- The time needed to develop the whole software is much longer than buying from a vendor because of the time needed for configuration, improvements and, testing.
- If your developer leaves the company, it can’t be ensured that the next person taking over will be able to provide all the necessary support to the company when problems occur.
Also, if you see that developing an ERP system from scratch in house will not bring additional competitive advantage to you, do consider buying it from a vendor.
To sum it up, making a decision whether to buy or develop an ERP system is not an easy one as each method has its advantages and disadvantages. Hence, do evaluate it by a long-term approach to see if your company is better off getting ERP software from a vendor or developing it in house. If you would like to talk to a vendor now, feel free to reach out to us – Synergix Technologies as we have almost 30 years of experience in this industry. Over the years, we have more than 600 successful software implementations for a variety of industries thanks to the ability to do modifications for our clients.