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Top 10 Benefits of ERP For The Manufacturing Industry

Top 10 Benefits of ERP For The Manufacturing Industry

A solution that can improve performance, lower prices, increase revenue, and increase productivity is possible because of the manufacturing sector's high level of diversity and efficiency. ERP manufacturing makes the maintenance of a centralized database possible, which integrates all aspects of operational activity.

ERP systems were formerly only used by global corporations, but in the recent year or so, they have gained tremendous popularity.

Nearly 35% of ERP implementations during the past year were carried out by companies using a legacy system, according to Finances Online Reviews for Businesses.

Companies will require a sophisticated ERP system to manage their everyday business operations.

ERP Software Used in the Manufacturing Sector: Various Types

ERP Software for Manufacturing : Various Types

Depending on their functionality and scale, different types of ERP systems are now available to meet the needs of a manufacturing organization.

1. Cloud-Based Manufacturing ERP Software

With regular upgrades, support, training, and even customization options, manufacturers who use this kind of software have a flexible yet complete system.

2. Hybrid ERP

By implementing a hybrid ERP, manufacturers can use both on-premises and cloud-based hosting and deployment options. Users have the opportunity to switch distribution models or incorporate advantages not included in the present implementations thanks to this technology.

3. On-premise Manufacturing ERP Software

Support, ownership, and control of the system are required for adopting this kind of manufacturing ERP software, along with the risk and expense of managing the hardware and systems infrastructure for manufacturers.

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Let's examine the top 10 benefits of ERP for the manufacturing industry in more detail.

Benefits of ERP for Manufacturing Industry

You can see why every manufacturing company would choose the ERP solution by considering the benefits of the ERP system, which are listed below.

1. Automate and Streamline Business Processes with Adaptability

An ERP system will automate your standard company procedures by preserving real-time data in a single, central location with complete insight into all operations. End users can keep track of production statistics without a different team member's intervention.

ERP manufacturing will eliminate the need for manual procedures by automating corporate operations. This automation will hasten the production process, eliminate the possibility of errors, and increase profitability.

2. Manage Cash-flow

For most organizations, a steady and reliable cash flow is essential, and you can better manage your cash flow with an integrated ERP manufacturing solution.

It will allow you to conduct purchasing and planning reports, follow up on past-due invoices, and get real-time information that will let you maintain a close check on the data. There will be an accurate record of what goes out and what comes in because every transaction will be recorded.

3. Customer Relationship Management (CRM)

A small portion of a company's customer base typically accounts for most of its revenues. To stay on top of market trends, manufacturers must keep a detailed record of their contacts with their top clients.

Without the business having to spend money on a standalone CRM solution, the customer relationship management (CRM) module in an ERP manufacturing system can accomplish that.

Additionally, the CRM feature enables salespeople to follow up on leads and customers more quickly and carry on interactions with them so that handoffs to others are simpler.

All quotes, order status updates, shipment tracking data, email correspondence, contract information, and issues and solutions are kept in one place. Fine-tuned reporting informs higher management of any difficulties with customer satisfaction.

At the same time, customizable permissions and dashboards guarantee that different sorts of personnel have the access they need. C-level management has access to insightful and comprehensive data when it is integrated with the sales management module of the ERP.

ERP software explicitly made for manufacturing organizations must advance as the environment for manufacturers and commerce changes.

Many ERP providers in this industry focus on increasing the speed and accuracy of manufacturing processes and reducing costs through the Industrial Internet of Things (IIoT).

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4. Enabling the Industrial Internet of Things

The concept of internet-connected refrigerators didn't seem futuristic until recently. Today, machine connectivity and the Industrial Internet of Things (IIoT) are both commonplace, as is the networking of everyday objects.

ERP for the manufacturing industry is progressively using IIoT technology on the production line. Simple examples include real-time sensors built into equipment and parts connected to the production control system. IIoT technology can enhance maintenance management by providing prompt alerts whenever any piece of equipment requires maintenance or repair.

On the consumer/IoT side, producers can add internet connectivity to their final goods to monitor problems and analyze the usage habits of their customers.

Updates may be transmitted directly to the products in some circumstances, enhancing its functionality without requiring the client to return the product or visit a physical store to resolve minor concerns.

5. Policy-Making Decision

An open-source ERP improves an organization's capacity for decision-making for the manufacturing industry. It provides a thorough overview of each team and the business cycle, enabling the client to appraise situations more quickly and accurately.

Manufacturers can keep focused on their goals and make the appropriate domestic decisions when necessary by accessing critical performance statistics like overall sales, sales margin, etc.

The industry's size, which was $75 billion in 2018, is expected to increase by more than 10% CAGR from 2019 to 2025.

Having a complete understanding of internal systems and divisions facilitates daily managing operations.

6. Decreased Costs and Improved Profitability

Business executives are concentrating on boosting revenue during the next two years. Business expansion and increased profits result from more work at reduced costs.

ERP enables enterprises to respond swiftly to market developments, such as shifts in raw material prices and delivery schedules.

A single, integrated database houses all the data, allowing quick information processing and high-quality decision-making.

Increasing organizational efficiency reduces waste and identifies less profitable areas. The price of controlling and managing inventory has also decreased.

7. Improved Business Insights

Businesses can increase product output more easily when quality management, project planning, simplification, and sales chain alignment are done quickly. The prompt delivery of goods to their destinations is crucial to preserving consumer happiness.

ERP Manufacturing for SMEs gives precise data so management may have a realistic view of inventory levels.

A modern ERP programme, such as cloud ERP and web ERP, will help manufacturing industries improve internal profitability. The creation of ERP manufacturing solutions enhances tracking, automation, and cooperation.

8. Increased Flexibility

Manufacturing flexibility enables swift responses to changes in customer demands in a pandemic world. With flexible manufacturing, a company is better equipped to collaborate to satisfy customer and market demands, react more promptly to shifting demand, and manufacture to order.

Increased market share, cost savings, and enhanced efficiency are all possible with flexible techniques.

9. Improvements to Product Quality

With ERP manufacturing systems, businesses may better manage their production facilities. These technologies give managers immediate knowledge about product flaws and ongoing problems in their production lines, enabling team leaders to identify and fix problem areas quickly.

The quality of the products will undoubtedly improve; as a result, increasing sales.

10. Providing One Source of Company Data

Manufacturing industries frequently struggle with logistical issues when assembling data from many sources within their organization.

ERP software offers a single location to access all data about productivity, pricing, administrative statistics, and other business-related information. Making decisions for the organization utilizing real-time, actionable data and working from the same data source is possible.

Top 5 ERP systems for Manufacturing:

1. ERPNext

ERPNext is a revolutionary ERP Software known for being 100% Open Source. Built on the Frappe Framework, this robust software is best suitable for small and medium sized manufacturing businesses. 

ERPNext offers tools to manage your Inventory, Production Planning, Bill of Materials (BOM), Work Orders., etc. It also provides you with Frappe Products like Frappe HRMS and Frappe Books to manage other operations of your Manufacturing Unit.

ERPNext is well known for being cost-friendly and that is one of the reasons why it is super popular amongst business owners. If you are looking for a straightforward ERP solution which doesn’t have a user limit or user based cost, then ERPNext is the solution for you!

2. Odoo

Odoo, formerly known as OpenERP, is the flagbearer of Open Source ERPs. Developed in Belgium, this ERP provides a modular/app based structure to manage all your operations.

As an added advantage, Odoo also comes with its own App Store, in which, the partners from across the world have developed Add-ons which are like a plugin and play. All you’ll have to do is buy the app from the app store, configure it and you’ll have those added functionalities in your database.

Odoo comes with two versions- Community and Enterprise. While Community is best suitable for small to medium businesses, Enterprise is meant for large enterprises. 


SAP is a widely used enterprise-level ERP solution known for its robust and scalable features. It typically caters to large manufacturing enterprises with complex operations.

SAP offers advanced manufacturing features like Production Planning, Shop Floor Control, Quality Management and Supply Chain Management. It provides real-time analytics and reporting for all of these.

SAP’s strength lies in its ability to handle complex manufacturing processes. It also provides comprehensive integration across departments and is trusted by many Fortune 500 Companies. However, it does stand on a bit of an expensive side and requires customization as well.


Overall, manufacturing is frequently referred to as a factory. This is true because one type of sector, manufacturing, also produces services. Production necessitates a manufacturing method that is both quicker and more effective.

One step you may take to improve your manufacturing company's operational effectiveness is the adoption of manufacturing software. Downloading manufacturing software pricing scheme calculations will provide an overview of the system before using it in your manufacturing industry. For more details....

Connect with ERP Experts

Getting users and functional groups to adapt their behavior to use the new solution is one of the main hurdles in adopting ERP. Project management must be effective, and senior leadership support is needed to drive this transition.

Naming one ERP as best for manufacturing won't be a good idea. Due to the variation in requirements of different manufacturers & feature these ERP offers, it'd be better to choose an ERP after ascertaining the business requirements, the leader in the segment, costing & experience in the same vertical. For example, “The requirements of a clothing manufacturer can differ from those who are into spinning yarn”. 

Some of the leading ERPs for manufacturing are:  (1) Oracle cloud Enterprise, (2) Odoo , (3) SAP-B1 MS-Dynamics, (4) SAP S/4HANA

An ERP system can help manufacturers in numerous ways as follow: 

- Measure the working time, Set standards for a particular process, and keep a check on delays 

- improve quality control 

- Eliminate repetitive tasks & hence improve work efficiency 

- timely availability of information can save a lot of time for the employees 

- Automating workflows/processes & integration with different machines for data input & processing can make the process quick but also help reduce staff.

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ERP Software - 26 Dec 2023

Thanks for this informative article on how ERP serves an important factor for manufacturing growth.