(This post was last published on March 11, 2015. We’ve updated it for accuracy and completeness.)
Installing an ERP like Sage is a crucial step for growing online businesses. ERPs are necessary tools to help manage inventory, purchasing and financial reporting. Even though necessary, adding another system to your technology stack complicates your business processes.
Instead of just working out of your eCommerce system like Magento, you now must worry about sharing that same data from Magento to Sage and vice-versa. This often requires you to hand-key online orders, inventory counts and shipping/tracking data between the two. Even during normal selling times, manual data entry can take employees several hours daily, slow down processes, and be error-prone.
When considering implementing an ERP like Sage, it’s important to consider how it will integrate with Magento. Integration eliminates manual data entry to ensure operational efficiency and data integrity across your organization. This article will provide a quick comparison of Sage’s various products and the best way to integrate with Magento.
Sage ERP Solutions for Magento
Already know what version of Sage you’re using? Skip down to next section on how to integrate Sage with Magento.
The first step in implementing Sage is choosing the right software version for your business. Over the years, Sage acquired various software platforms and has various offerings. Here’s a quick overview of their more popular choices.
(Side note: Are you still on Magento 1? Check out important Magento 1 end of life dates here.)
For small businesses:
Sage 50 is desktop accounting software connected to the cloud. It’ll cover the essential finances for your online business – even if you’re just starting out. Sage 50 would be comparable to accounting software like Quickbooks Online.
For medium size businesses:
Sage 100 Cloud: Sage 100 is your next move beyond basic accounting software. It’s great for manufacturing, distribution and service industry processes. You’ll get features you need to automate your finances and accurate reporting, even across your supply chain.
Sage 300 : Sage 300 is cloud-based account software aimed towards manufactures, distributors, and retailers. It’ll help you manage your accounting, mulit-location inventory, operations, and distribution. It also supports multiple companies and languages.
Sage Business Cloud Enterprise Management (formerly X3): Business cloud is Sage’s global Enterprise offering for financial, supply chain and production management, along with business intelligence capabilities.
Benefits of Integrating eCommerce and ERP Systems
Integrating these two crucial systems payoffs for both your productivity and customer experience.
Integration improves your operational efficiency and productivity:
- Eliminates manual data entry with real-time data processing
- Reduces costly data errors caused by manual data entry like mistyping shipping address or SKUs
- Ensures data integrity across entire organization
- Saves times as order processing can improve from several minutes per order to just a few seconds
- Move employees from manual data entry to more important tasks such as getting more products shipped
- Process orders accurately without customer complaints
- Offer and meet shorter online order delivery times
- Offer multiple fulfillment options like buy online, pick up in-store
- Display accurate inventory levels online and avoid overselling
- Run flash sales effectively
- Display accurate product listings and quickly update prices and promotions
With benefits like these, most merchants recognize the importance in investing in an integration solution between Sage and Magento.
Best Practices for Integrating Magento and Sage
Magento and ERP integration projects can be a big undertaking. Picking the right approach and partner to collaborate with is crucial to the project’s success. Mismanaged projects can waste time and money, while never producing a result that just works for your business.
There are two main approaches you can take to integrating Magento and Sage: building a custom solution and using an off-the-shelf solution.
Here’s how they compare:
Custom Magento to Sage Integration
Most merchants turn to custom integration as their first option. These solutions are usually built in-house or by a vendor like your web agency or ERP implementer. We consider custom integration as hardcoded, one-off solutions that tie Magento directly to Sage.
With a robust, open-source platform like Magento, custom integrations are appealing because of the vast number of customizations you might have built into your platform. You may think you need a homegrown integration solution to meet your needs.
Even with heavy customizations needed, you should tread lightly when evaluating this approach. Custom integration is expensive (read: thousands) to build and maintain, and you should only take this approach if you have unconventional requirements or proprietary reasons to do so.
- Highly flexible
- Continue to work with vendor that you know well
- Maintain complete control over software and features
- Custom integration is expensive upfront to implement and maintain over time
- All the risk falls to you (and your implementation partner)
- No support, unless your implementer offers it
- You’ll have to deal with every upgrade to both Sage and Magento
- Hard to scale overtime as adding or removing systems can require starting integration over from scratch
Lastly, it’s important to callout that integration projects require vendors to know BOTH Magento and Sage well. How Magento reads and accepts data is totally different than Sage. For example, an ERP uses product data fundamentally different than Magento.
When evaluating your vendor, be sure to test and understand their knowledge of both your endpoint systems. It’s a serious learning curve to understand how both these systems work. It’s not something you want your vendor learning on the fly during your project. The result will be a buggy solution that you’ll routinely have to find, fix and pay for.
Despite considerable cons to custom integration, this approach might still make sense for some who have unique needs and the ability to support a custom integration in-house. At the end of the day though, do you want your business focused on building and maintaining software or selling products and improving customer experience?
Custom integration will certainly take more time and effort on your part to achieve.
SaaS Magento Integration Applications
On the other side of the aisle, there are SaaS (Software as a Service) middleware integration solutions. These off-the-shelf integration tools connect your systems using pre-built connectors to sync data and automate processes between Magento and Sage. They are often referred to as hub-spoke models or middleware platforms since there’s an operational “hub” that sits between your endpoint systems.
Off-the-shelf solutions leverage pre-built integration templates to connect Magento and Sage. You’ll get out-of-the-box functionality, along with the ability to configure workflows or business logic to your needs.
- Built practice around integrating retail endpoint systems
- Leverage pre-built integration for both Magento and Sage
- Faster to implement
- Third-parties responsibility to host, maintain and upgrade integrations
- Flexibility to add or remove systems as needed
- Lower upfront costs and long-term (subscription-based model)
- Depending on solution, limited features or capabilities out-of-the-box
- Lose control over features available
- Involvement of another third-party into your project
For SaaS applications, you’ll pay a monthly subscription rate that typically ranges from $100 – $1,000, based on the robustness of the solution and complexity of your needs. The monthly subscription rate is for the third-party to host, maintain, and upgrade your connections on their cloud-based platform. In most cases, you’ll also pay a one-time fee to implement your solution, which can be around $2,500 to $10,000.
Today, merchants have all sorts of integration solutions to choose from. You can work with a vendor to build a totally custom connection, but you’ll be responsible for maintaining and support it over time. Or, merchants can evaluate off-the-shelf solutions from companies who’ve built a practice around eCommerce integration. Even with custom and unique needs, merchants can leverage SaaS integration platforms to meet their needs for popular systems like Magento and Sage.
Picking the bets solution requires you to vet offerings based on budget, complexity of operations, plans of future growth, and resources available. In many cases, your eCommerce agency or software consultant might be able to recommend a third-party integration provider.
If you want to learn more about SaaS integration applications, check out nChannel and our solutions for Magento to Sage integration.
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