Buyer’s guide

ERP for small businesses: when you need it and what to choose

Most small businesses start on accounting software and spreadsheets, and that works until it does not. This guide explains the signs you have outgrown your setup, the ERP options that suit smaller organisations and how to keep the project proportionate.

By Christopher Fagan, Managing Partner, PEF Consulting Partners

Do you need ERP yet?

ERP joins finance, stock, orders, purchasing and sometimes production in one system. You probably need it when:

If none of these apply, good accounting software with a few well chosen apps may serve you better for now.

Options that suit smaller organisations

Product Good for Watch out for
Microsoft Dynamics 365 Business Central Distribution, services and light manufacturing, especially Microsoft 365 users Partner quality varies, so scope carefully
Odoo Low cost, modular apps you can add over time Customisation can grow quickly; choose a strong partner
Sage 200 UK businesses wanting stock and order processing from a familiar vendor Installed or hosted rather than built for the cloud
SAP Business One Product businesses wanting an established ERP Hosting and partner add ons add cost
NetSuite Fast growing, multi entity or ecommerce businesses Higher subscription and renewal increases
Acumatica Businesses with many occasional users Smaller UK partner network

What it costs

Expect licences from a few hundred to a few thousand pounds a month, depending on users and modules. Business Central Essentials is £61.50 per user per month, and Odoo Standard is around £18 to £23 per user per month. Implementation for a small, standard scope is often in the tens of thousands of pounds; SAP Business One partners, for example, commonly quote £30,000 to £45,000 for a simple project.

Keeping the project proportionate

Related reading: best ERP software for UK businesses, Business Central pricing, ERP readiness assessment, what is ERP.

Common questions

What is the best ERP for a small business in the UK?

Business Central, Odoo, Sage 200, SAP Business One and NetSuite are the most common choices. The best fit depends on your sector, growth plans and whether you use Microsoft 365.

How much does ERP cost for a small business?

Licences typically run from a few hundred to a few thousand pounds a month, with implementation often in the tens of thousands for a standard scope.

Can a small business implement ERP without consultants?

A simple, standard implementation with a good partner can work without separate advisers. Independent help pays for itself when the scope is unclear, partner proposals differ widely or the project starts to slip.

How long does a small business ERP implementation take?

Often three to six months for a standard scope, and longer with several companies, production or complex integrations.

Unsure whether you need ERP yet? A short readiness check will tell you, and if the answer is not yet, we will say so.

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