Best ERP Alternatives for Growing Small Businesses in 2024

Before we dive into ERP alternatives, it's essential to understand what an ERP system actually is and why they're commonly recommended for business management. ERP stands for Enterprise Resource Planning. At its core, an ERP system is a suite of integrated applications designed to automate and manage a company's vital functions, from finance and human resources to procurement, inventory, and even customer relationships.

Why are ERP systems often the go-to solution? They offer a centralized repository for all business data, making it easier for departments to collaborate. They also bring efficiency by automating tasks and presenting real-time data for informed decision-making. However, ERP systems come with their drawbacks: they are expensive, can be cumbersome to implement, and often offer more functionalities than a growing business currently needs.

If you're a growing enterprise, you may find that ERP is akin to using a sledgehammer to crack a nut—effective but excessively elaborate for your current requirements.

So why consider an ERP alternative? There are compelling reasons that align specifically with the needs and constraints of growing businesses:

Cost Savings: One of the most immediate benefits is the cost advantage. ERP systems often involve hefty initial investments and ongoing maintenance costs. Alternatives usually offer a more scalable pricing model, allowing you to only pay for what you use.

Ease of Use: ERP systems are feature-rich but can be overwhelming. Alternatives often focus on user experience, making them easier to use and quicker to implement.

Flexibility and Scalability: ERP alternatives are generally more agile, allowing you to customize or add features as your business grows.

Less Resource-Intensive: Full-scale ERP implementations can take a toll on your staff's time and focus. In contrast, ERP alternatives are quicker to deploy and easier to maintain.

Streamlined Features: Let's face it, not all businesses need every feature an ERP system offers. Alternatives let you focus on functionalities that directly impact your bottom line.

By opting for an ERP alternative, you're choosing a path that offers the functionalities you need right now, with the scalability to grow alongside your business.

Implementing an ERP system is not just a matter of installing software; it's a considerable financial undertaking. Initial costs include not just the software purchase but also its implementation, customization, annual fees, and ongoing support and maintenance. And as many companies discover too late, hidden costs like business process change, organizational change management, data migration, and testing can add up quickly. In fact, mid-market to large-scale ERP systems can drain companies of millions of dollars in total cost of ownership (TCO).

To put this into perspective, based on a historical five-year average of projects performed by Excelym, the TCO for NetSuite is $174,500 for the first three years, with a recurring $30,000 annual fee for SaaS. This estimate is based on companies with at least $12 million in annual revenue and a workforce of 50+ employees undergoing a traditional implementation package via a NetSuite partner. Another mid-market ERP solution, Acumatica, has an estimated TCO—based on a Forrester report—of over $2 million for the first three years.

Compare this to ERP alternatives that are tailored for small to mid-sized businesses, and the cost savings become glaringly apparent. This considerable financial burden, coupled with a lengthy and complicated implementation, can adversely affect both your budgets and staff resources, making ERP alternatives an increasingly attractive option for many businesses.

Before diving into the list of top ERP alternatives, it's crucial to establish the criteria that matter most when making a selection:

• Scalability: Will the solution grow with you? You need an option that won't just meet your current needs but will also be a fit as your business expands.

• Ease of Use: A user-friendly interface is crucial, especially if you don’t have a dedicated IT team. Look for intuitive navigation and good customer support.

• Feature Set: What functionalities are non-negotiable for your business? Inventory management, financial reporting, CRM—ensure the features you need are not only available but also efficient.

• Cost: Budget is a big deal for growing businesses. Ensure the pricing model works for you both now and in the foreseeable future.

• Ease of Integration: How well does the solution integrate with your existing systems? You don't want to deal with disparate systems that don't talk to each other.

This evaluation framework will guide you through your selection process, ensuring you choose a solution that is both a strategic and operational fit for your growing enterprise.

There's an adage that says, "If it ain't broke, don't fix it," and this holds especially true for business management systems. If your current setup—be it QuickBooks, Xero, or another foundational system—is serving you reasonably well but showing signs of strain, it might not be time for a full overhaul. Instead, you might benefit from simply extending its capabilities.

In many cases, smaller businesses find that they don't need to replace their existing systems entirely. Rather, they can integrate add-on solutions to bring in more advanced functionalities. The advantage of this approach is twofold:

1. Lower Risk: You are working with a system your team is already familiar with, reducing the learning curve and associated risks of implementing a completely new solution.

2. Cost-Effectiveness: Adding specific functionalities often costs less than investing in an entirely new system, allowing you to allocate resources more effectively.

This is where ERP alternatives like NEX come in. They seamlessly integrate with your existing systems, filling the gaps without requiring a major system upheaval.

Stick with QuickBooks as an ERP Alternative?

If you're already using QuickBooks for your accounting needs, there's no need to rip out your existing system to implement a more complicated, costly ERP solution. Most companies that move to an ERP system for the first time are coming from QuickBooks, and they're often unaware that a simpler, more cost-effective solution exists. NEX integrates seamlessly with QuickBooks, allowing your financial staff to continue using a system they know and trust, while benefiting from advanced features that rival those of a full ERP system.

Now that you're convinced a best of breed approach is the way to go, how do you choose the right one? Here's a step-by-step guide to making an informed decision when it comes to selecting an ERP alternative:

1. Needs Assessment: Identify your must-haves and nice-to-haves. Create a list of essential features you need immediately and functionalities you'll require as you grow.

2. Budget Analysis: Evaluate your financials to determine how much you can afford to spend upfront and on ongoing expenses.

3. Vendor Research: Read reviews, customer testimonials, and perhaps even get referrals. You'll want to gauge the reliability and reputation of the vendor.

4. Demo and Trial: Most vendors offer free demos or trials. Take advantage of these to test the software's usability and features.

5. Ease of Integration: If you’re extending your existing system, consider how easily the new software integrates with it.

6. Customer Support: Good customer service can be a lifesaver. Look for vendors that offer robust support via multiple channels.

7. Community and Resources: A vibrant user community and a wealth of online resources can significantly ease the learning curve.

8. Future-Proofing: Ensure the software is up-to-date with the latest industry trends and is committed to regular updates and new features.

By following this guide, you'll be well-equipped to select an ERP alternative that not only meets your current business needs but also aligns with your growth trajectory.

The market is full of promising ERP alternatives, each with its own unique set of features and benefits. Below, we've narrowed down the top contenders that offer robust functionalities without the complexities of a full-fledged ERP system.

NEX is an innovative software platform that offers a seamless integration with leading financial management applications like QuickBooks and Xero. Designed for small to medium-sized businesses, it fills the gap in areas such as inventory management, order processing, service management, and customer relationship management (CRM), providing rich functionalities often only found in expensive ERP systems.

Features:

• Seamless Integration with QuickBooks and Xero: NEX is designed to work in tandem with accounting software you already use and trust, eliminating the need to overhaul your existing financial systems.

• Comprehensive Inventory Management: Gain control over your stock levels, order fulfillment, and warehousing needs with a robust set of tools.

• Order Management: From quote to delivery, NEX offers end-to-end control over your order processes, ensuring timely deliveries and happy customers.

• Service Management: Efficiently allocate resources, manage appointments, and track service delivery through a unified platform.

• Rich CRM Capabilities: Understand, track, and manage your relationships with customers like never before, with an array of CRM tools that are usually reserved for more expensive systems.

Pros:

• Highly Customizable: NEX is designed to adapt to your business needs, not the other way around. With a range of customization options, you can tailor the system to your specific industry requirements.

• Cost-Effective Scaling: As your business grows, NEX scales with you. You won't find yourself bogged down with features you don't need or locked into an expensive contract.

• Quick to Implement: One of the standout advantages of NEX is the speed of its deployment. Businesses can be fully operational within a fraction of the time it takes to implement a traditional ERP system.

• Exceptional Customer Service: A responsive customer support team ensures that any issues are dealt with promptly, keeping your business operations smooth.

Cons:

• Newer to the market, but rapidly gaining traction

Pricing:
NEX offers flexible pricing plans designed to accommodate businesses of all sizes, from startups to more established enterprises. It provides all the features that matter most, but at a fraction of the cost of full-scale ERP systems.

Why NEX?:

If you've been seeking a solution to enhance your current systems without disrupting your existing operations, NEX offers an ideal fit. It merges seamlessly into your existing ecosystem and brings with it the kind of advanced management capabilities often found only in far more expensive systems. Moreover, its straightforward setup means you can hit the ground running and focus on what matters most: growing your business.

Acctivate is a business software designed primarily for small to medium-sized businesses that need more than just basic inventory management. It's a versatile platform that offers features such as advanced inventory tracking, sales order management, and robust business analytics. The software is particularly strong in sectors like wholesale, where precise inventory management is crucial. While it has a comprehensive suite of tools for various business operations, it is somewhat limited in terms of customization and has been reported to be challenging to set up. Acctivate is positioned as a mid-range solution in terms of pricing, with additional costs for premium features. Overall, it provides a range of features that are well-suited for specific industries but may have limitations when it comes to customization and ease of use.

Features:

• Inventory Management: Acctivate's robust inventory management capabilities are designed to handle the complexity of maintaining multiple stock locations, lot and serial number tracking, and real-time updates.

• Business Analytics: Acctivate comes with a set of solid reporting tools that can help businesses make informed decisions, including sales analytics, cost tracking, and customer behavior analysis.

• Sales Order Management: This feature supports a diverse set of order types, making it adaptable for both B2B and B2C operations.

Pros:

• Solid Reporting Tools: Acctivate shines when it comes to analytics and reporting, providing businesses with valuable insights for better decision-making.

• Industry Specific: Acctivate has features that make it particularly effective for specific industries like wholesale, where detailed inventory management is a must.

Cons:

• Limited Customization: While Acctivate provides a range of features, it does lack in customization options, which can be a disadvantage for businesses with unique requirements.

• Challenging Setup: Users report that the system can be cumbersome to set up initially, creating a potential delay in getting the system up and running.

Pricing:
Acctivate is positioned as a mid-range solution, but keep in mind that there can be additional costs for premium features, making it less cost-effective in the long run.

Bottomline: Acctivate offers a variety of features that are well-suited for specific industries like wholesale. However, its limitations in customization and the complexity of its setup can be significant downsides for businesses. In contrast, NEX is designed to be highly customizable and user-friendly, allowing for a smooth setup process. Moreover, NEX offers competitive pricing without hidden costs for premium features, making it a more cost-effective and adaptable solution for businesses of all types.

Cin7 (formerly known as Orderhive) is a cloud-based inventory management solution that offers a range of features, including order management, warehouse management, and point-of-sale functionalities. It is often used by businesses that require more sophisticated inventory and order processing capabilities, such as e-commerce companies.

Features:

• Order Management: Cin7 excels at handling complex order workflows, making it possible to track orders from multiple channels all in one place.

• Warehouse Management: Their solution provides detailed warehouse management features, allowing for real-time tracking of inventory levels, order status, and shipments.

• Point of Sale: In addition to its other capabilities, Cin7 offers Point of Sale (POS) features, making it versatile for both online and brick-and-mortar sales.

Pros:

• Comprehensive Order Tracking: One of the standout features of Cin7 is its ability to provide comprehensive, real-time tracking of orders, making it particularly suitable for e-commerce businesses.

• Suitable for E-commerce Businesses: Given its strong capabilities in order management and inventory tracking, it is particularly popular among e-commerce companies.

Cons:

• Steeper Learning Curve: Due to its array of features, Cin7 can be overwhelming for some users, leading to a steeper learning curve compared to simpler solutions.

• Customer Service Issues: Some users have reported less-than-stellar customer service experiences, which can be a major drawback when issues arise.

Pricing:
Higher Upfront Costs: Cin7 tends to have higher upfront costs compared to other ERP alternatives. Additionally, variable pricing for added functionalities can make it more expensive in the long run.

Bottomline: While Cin7 offers a range of functionalities that make it appealing, especially to e-commerce businesses, it comes with its own set of challenges. The steeper learning curve and customer service issues can create roadblocks for businesses looking for a seamless solution. Moreover, the higher upfront costs can be a significant barrier for smaller businesses. In contrast, NEX offers a more streamlined, user-friendly experience with competitive pricing and superior customer support, making it a more suitable choice for businesses seeking an ERP alternative without the added complexity and cost.

Zoho is a well-known software company that offers a suite of online productivity tools and SaaS applications, including Zoho CRM, Zoho Books (financial management), and Zoho Inventory, among others. While it's generally known for being a more budget-friendly option compared to bigger ERP systems, it's often used by small to medium-sized businesses for specific functionalities rather than as a comprehensive ERP alternative.

Features:

• Wide Array of Functionalities: Zoho's expansive suite of applications covers most business operations, making it a convenient one-stop shop for many companies.

• Good for Very Small Businesses: Given its modular nature, businesses can pick and choose which functionalities they need, making it flexible for smaller businesses.

Pros:

• Wide Array of Functionalities: Zoho's expansive suite of applications covers most business operations, making it a convenient one-stop shop for many companies.

• Good for Very Small Businesses: Given its modular nature, businesses can pick and choose which functionalities they need, making it flexible for smaller businesses.

Cons:

• Lacks Specialized Features for Specific Industries: While Zoho provides a broad range of general business functionalities, it may lack the in-depth features needed for specialized industries like manufacturing or healthcare.

• Can Get Expensive: While the basic modules are relatively affordable, costs can quickly accumulate as you add more functionalities or users.

Pricing:
Flexible, But Costs Can Accumulate: Zoho operates on a subscription model where you pay for the modules you use. While this is flexible, adding advanced features, additional users, or integrating with other systems can increase the costs over time.

Bottomline: Compared to a more integrated solution like NEX, Zoho's offering can sometimes feel piecemeal—requiring businesses to manage multiple subscriptions and interfaces. In contrast, NEX offers an economical yet comprehensive set of features integrated seamlessly with QuickBooks, making it a compelling ERP alternative for growing businesses.