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When Do SMEs Need An ERP System?

Year 2021
March 2021
When Do SMEs Need An ERP System?
19 Mar 2021

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The advent of ERP software has brought a huge bunch of benefits for businesses since there are more and more of them engaging in and adopting a specific one. With the help of an integrated ERP system, companies are able to increase the productivity of business operations in Project Management, Human Resource Management, Budgeting and Cost Control, Customer Service Relationship, Field Service Management, and so forth. Despite that, SMEs still question if they should invest in an ERP system as it usually requires a huge number of resources for a successful ERP adoption. In this article, we would like to help to answer this question but still sooner or later, it is your decision for adopting one.

When it’s not the time to invest in an ERP system?

The key to answer this question might depends on the concerns on your resources of time and labor. ERP system operates based on finance, human resource and workflow. No matter what industries your SMEs are into, the dawning stage always is the most difficult time to set up a clear process and make essential business decisions with a limited budget. For this reason, the period of one or two first years might not be the most suitable time to own an ERP software since there are many more important aspects to focus on.

1. Limited sources of finance and labor.

A SME at the starting point tends to be limited in both finance and labor force. Financial background is normally in short supply as it can be built from the help of family, friends or even a loan from the bank. This is the time to focus on the market, general strategies and core products, not to care much about enhancing the internal systems. As well, the temporary workforce remains restricted as it might be easy to keep up with beginning tasks with little data and only a few clients. In this condition, it would be inadvisable for SMEs to invest in an ERP system.

2. Incomplete workflow.

To achieve a proper and completed working process, there should be thorough references from other businesses and many times of internal trials. At the beginning, it might be hard for SMEs to have a comprehensive workflow as they have not had sufficient experience in running their business. Thus, implementing an ERP system at this stage will pose potential risks to SMEs in terms of both finance and operation aspects. During this period, strategies may need to be changed to suit the target market, so SMEs must take any business action into serious consideration for the highest productivity.

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So when is the right time to host an ERP software?

Over time, your child will grow up and bring a huge number of clients, profit and venture capital funds to you in return. As it grows, so does your amount of data, your clients and documents generated. If you are sure to be in a stable financial state as a sustainable business, and in the need to improve your workflow, consider to entry into the digitalization era.

1. Accounting takes much time.

Accounting is a task with high difficulty and accuracy that requires accountants to have diverse knowledge such as accounting, finance, tax, law, and so on. Mostly, SMEs have only one or two people in charge of financial things, but the workload can be enormous as the company gets on bigger scales. With such a huge workload, the records become cumbersome, and might lead to many mistakes and security problems as well. Up till then, you definitely crave for ERP solution’s support to automate and simplify the undertakings. With the help of an ERP system, the task of tracking capital, cash flow, expenses, salaries, taxes and reports can be updated at real time and with less error.

2. Labor and clients grow.

As your enterprise grows, it means more labor and clients. Archiving employee’s information and client’s data would be problematic if the process is not clear and optimal. In this case, adopting ERP software can assist with this task in a well-organized way. At the same time, it is possible to manage sales activities, tasks, projects so that you can increase the efficiency, productivity of organizational operations and hence, increase customer service and foster revenue.


Implementing ERP solutions needs a high determination from the entrepreneurs because careful analysis and understandings the current conditions are required to have the most effective one. A research on ERP vendor on the current market is indeed indispensable for SMEs to take the first step.

Government Grant

To encourage SMEs to activate digitalization at the peak of their journey, Singapore Government has launched several grants for businesses to consider such as Productivity Solutions Grant (PSG), Enterprise Development Grant (EDG), E-Invoicing Registration Grant (ERG). As a PSG pre-approved vendor, Synergix Technologies has successfully provided many clients government grants of up to 80% of the qualifying cost.

Should you concern about adopting ERP software for your business, contact us now for a free consultation!

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