What is ERP? What does ERP software do?

Definition of ERP

ERP (Enterprise Resource Planning) is the general name for systems that manage a business's processes, such as sales, purchasing, inventory, production, finance, accounting and human resources, in a single software application on a single database.

The core idea of ERP is simple: a piece of information enters the business once, and every related process uses that same information. For example, a sales order becomes the starting point for inventory, shipping, invoice, collection and accounting records. This way, the same data is not entered again and again into different programs.

Which processes does ERP software cover?

ERP systems are modular. Businesses start with the modules they need and add new ones as they grow. Common module groups include:

• Commercial management: customer relationship management (CRM), sales, shipping, purchase requests, supplier relationships and purchasing
• Operations: materials, warehouse and inventory management, production, projects, assets (fixed assets) and foreign trade
• Finance: current accounts, cash and bank, loans, POS and credit cards, cheques and promissory notes, cash and treasury management
• Accounting and tax: general accounting, tax returns, valuation, non-deductible expenses (KKEG) and Social Security Institution (SGK) transactions
• Corporate governance: human resources and payroll, contract, document and workflow management
• Digital processes: e-Transformation applications such as e-Invoice (e-Fatura), e-Archive Invoice (e-Arşiv), e-Waybill (e-İrsaliye) and e-Ledger (e-Defter), plus integrations
• Reporting: financial, fiscal, commercial and management reports

What does ERP bring to a business?

The benefits of ERP depend on how far the business's processes are moved into the system. In general, gains are expected in the following areas:

• Single source of data: Because sales, inventory and finance use the same information, reports are consistent with each other.
• Less repetitive work: The same information is not transferred by hand into different spreadsheets and programs.
• Visibility: Management tracks cash, inventory and sales without waiting for the end of the period.
• Control: Permissions, roles and approval steps are defined, and who did what can be traced.
• Legal compliance: Obligations such as e-Invoice, e-Ledger and tax returns run on the same platform as commercial records.

The difference between a basic accounting program and ERP

Basic accounting programs (known in Turkey as "ön muhasebe" software) usually focus on core transactions such as invoices, current accounts, cash and inventory. ERP, in addition to these transactions, brings processes such as purchase approvals, production, projects, assets, human resources, financial services and management reporting together in the same data structure.

As the number of users, branches and warehouses grows and approval processes become more complex, businesses usually move from a basic accounting program to ERP.

Cloud ERP and on-premise ERP

Cloud ERP (SaaS) is the model in which the software runs on the provider's infrastructure and is used through a subscription. It requires no server investment and can be used from anywhere with internet access. In private cloud models, the infrastructure is dedicated to the business. In an on-premise installation, the software runs on the business's own servers.

At Factorbooks, ERP packages are offered on the public cloud with an annual subscription, while Autonomous Business Management (ABM) packages are offered on a private cloud or as an on-premise installation.

How to get started with Factorbooks ERP

Factorbooks brings commercial, operational, financial, accounting and tax processes together in 47 modules. You can start with the Micro Business, Small Business, Mid-sized Business and Large Business ERP packages and move to Autonomous Business Management (ABM) packages as your needs grow. You can see which package fits you with the package finder or request a live demo.