ERP

ERP (Enterprise Resource Planning)

An ERP (Enterprise Resource Planning) system is the central software a company runs its operations on, tying together finance, inventory, purchasing, sales orders, and fulfillment in one database. When an order arrives, the ERP is where it becomes a sales order, gets picked and shipped, and is invoiced. Examples include NetSuite, SAP, and Microsoft Dynamics.

What an ERP does

An ERP is the single source of truth across departments, with modules for accounting, inventory, order management, purchasing, and the warehouse. Because everything shares one database, a posted order updates stock, cost, and the general ledger at once. For distributors, the order management and inventory modules carry the daily load.

How orders reach the ERP

Orders enter the ERP as EDI, as API calls, or by manual keying from PDFs and emails. The integration that maps an incoming order to the ERP's sales-order format is where most order-entry pain lives. A clean EDI or extraction pipeline drops structured orders straight into the ERP with no re-keying.

Related Terms

Sales Order

A sales order is the seller's internal record of a confirmed customer order, created from the buyer's purchase order. It drives picking, packing, shipping, and invoicing. When a retailer's EDI 850 purchase order lands, it becomes a sales order in the supplier's ERP, ideally with no manual re-keying.

Purchase Order (PO)

A purchase order (PO) is a buyer's official offer to purchase goods, listing items, quantities, prices, delivery dates, and ship-to location. It becomes a binding contract once the seller accepts it. In EDI it is the 850 transaction, the document that starts most B2B order flows.

EDI (Electronic Data Interchange)

EDI (Electronic Data Interchange) is the computer-to-computer exchange of business documents like purchase orders and invoices in a standard electronic format. It replaces paper, fax, and email so two trading partners' systems can transact directly, without anyone re-keying the data.

Learn More

ERP-EDI Integration Guide ERP Integration ERP Integrations Directory

Frequently Asked Questions

ERP stands for Enterprise Resource Planning. It is the central system that runs a company's finance, inventory, purchasing, and order operations from one shared database.

Common ERPs in distribution include NetSuite, SAP, Microsoft Dynamics 365 Business Central, Acumatica, Sage, Epicor, and SYSPRO.

An ERP is the broad operational backbone covering finance, inventory, and more. An order management system focuses on the order lifecycle and often feeds orders into the ERP.

Sources: ASCM supply chain terminology

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