Enterprise resource planning (ERP)
Reviewed by Dasha ShakovVP Marketing, Proton
Updated
What is ERP?
Enterprise resource planning (ERP) software is the central system a distributor runs on, holding orders, inventory and accounting in one database. It also holds customers, items, prices, purchasing and invoicing, and in most distributors every sale, receipt and payment passes through the ERP.
How it works
The ERP is the system of record for transactions. Distributors connect it to other systems for specialized work, such as a CRM for sales activity, a PIM for product content, a WMS for complex warehouses and an ecommerce site for online ordering.
ERP example
As an order is entered, picked and delivered, the ERP reduces stock, creates the invoice and records what the customer owes in accounts receivable.
Further reading
Often confused
Related terms
- Customer relationship management (CRM)Customer relationship management (CRM) software is a system for tracking customers and prospects: contacts, calls, visits, opportunities and follow-ups.
- Product information management (PIM)Product information management (PIM) is software, and the process around it, for collecting, enriching and publishing product data from one place.
- Warehouse management system (WMS)A warehouse management system (WMS) is software that directs and tracks the work inside a warehouse, from receiving and putaway to picking and shipping.
- Electronic data interchange (EDI)Electronic data interchange (EDI) is the exchange of business documents, such as POs and invoices, between two companies’ systems in a standard format.
