Top 5 Differences between ERP Software vs. Point of Sale Software

It is normal for many to get confused with ERP and POS software. Both used to look similar, but there are many differences, and with a great understanding of both software, you can know these differences. 

The easiest way you can imagine is to think of ERP software as the brains of the business and POS software as the heart. The difference between ERP and POS software is a big topic for discussion. As both the software serve their own needs, knowing their differences is essential. Here’s what you need to know about POS and erp services and their top 5 differences:

What is POS?

The Point-of-Sale is an important and very much an integral part of the purchase and refers to the place where a customer makes a payment. But the software used in POS is not just a mere cash register as it has come a long way to boost the business by incorporating various other functions. 

Apart from being a digital version of a cash register, POS software automates many business processes and simplifies operations. It can also be a one-stop solution to serve various customer needs. 

POS helps in simplifying the business operation, inventory management, customer management, and also accounts. It integrates the hardware devices like weight scales, payment terminals, printer, and barcode scanner, which acts as a powerful tool in running the business successfully. 

What is ERP?

ERP software has evolved over the years from being a physical client server-based software to cloud-based software that enables web-based access. ERP software, in a simple form, can be said as a bridge that connects every computer system in a big organization. 

Without an ERP system, each department would function with their own systems and software without much integration among various departments. With ERP systems, each department will have a system in place, and it takes only one interface and one application to integrate all the systems. 

ERP collects the necessary data on every activity in the organization and conditions of various divisions and makes the data available for productive use. An erp software development services can assist the business in building awareness by integrating information about finance, HR, and production.

Difference between ERP software and POS software

• Scope and functionality

ERP: An ERP system covers not just the sales part of the business and it takes care of a broader range of functions. ERP software can help to integrate various department functions like manufacturing, human resources, finance, and also supply chain management. The ERP software simplifies the business process and provides a broader picture of the entire business operation. 

POS: The POS software mostly focuses on easy facilitation of the point of sale, payment processing, and managing the inventory. The software is designed for more transactions, and it enhances customer interactions during the purchasing process.

• Data use and Decision making

ERP: The ERP system uses large data for making advanced analytics that helps in decision-making. With the help of ERP software, you can make use of previous data and also current data to get insights into the performance of the business. This helps to optimize the business process and support strategic planning.

POS: The primary purpose of the POS software is to use data to record the sales, manage the inventory and generate receipts. They can also be used for basic reporting, but they are not as robust as ERP software in terms of business intelligence and advanced analytics.

• Automation

ERP: An erp development will incorporate the automation process and simplify the complex business processes. The software can be used to automate many tasks like processing orders, inventory replenishment, efficiency improvement, and workflow management.

POS: The focus of the POS system will be on automating the sale-related works such as price calculation, scanning, and payment processing. Mostly the automation of POS is restricted to the sales realm and not outside it. 

• Business planning

ERP: The ERP software supports business growth by providing the right tools for planning resources, strategic decision-making, and forecasting business for the future. They help the business use the resources in the right way with long-term goals. 

POS: The primary role of the POS system is to facilitate the sale transaction and manage inventory that contributes to revenue generation in day-to-day operations. The features for any long-term strategic planning are much less in POS.

• Integration 

ERP: The ERP software is designed in a way that it can incorporate various functions of different departments. This enables easy data flow in different areas of the business. To get a holistic view of the business operation, get help from erp services that can provide a better ERP solution.

POS: POS is tightly integrated with sales and inventory management, and it proves a standalone solution. They may not have the level of integration that is found in ERP systems for overall business operations.

ERP Vs. POS: What to choose?

What would be better, ERP software or POS software? It will depend on your needs and specific needs of your business. The first thing you have to decide before purchasing a product is to understand your clear requirements. 

The POS software will be a suitable solution for you if you choose to start computerizing the data and transactions of the sales process. ERP software will be of great help if you want to integrate every business operation and grow the business by making decisions based on large data. 

Final thoughts

These differences mentioned can give you a broader picture of the differences between ERP and POS software. Now you do not need to get confused about the main functions of these two software and choose the one based on your preferences. 

POS can be considered a new form of automated cash register. But, ERP software offers solutions to the day-to-day business by integrating various departments. If you need data-driven integration of various functions, then ERP services can handle that task for you. Get in touch with the erp development company and explain your requirements to get the best out of ERP software.