How to choose an ERP: a buyer's guide for B2B trading companies

Do you need an ERP yet?

You need an ERP (enterprise resource planning: one system for sales, purchasing, stock and accounting) when the cost of keeping separate tools in step is higher than the cost of replacing them. The point usually arrives gradually, not in one crisis. Knowing how to choose an ERP starts with knowing why you want one.

Common signals:

• Quotations live in Word, orders in Excel and stock in someone’s head, so the same order is typed three times.
• Sales promises deliveries the warehouse can’t make because nobody sees reserved stock.
• Stores and accounts argue about what actually arrived from a supplier.
• Stock reports and the books disagree at every month-end.
• Approvals happen in chat threads and can’t be found during an audit.
• A second company, a second warehouse or a second currency doubled the spreadsheets.

If three or more of these sound familiar, start the process below. For a longer diagnosis, read 9 signs your trading business has outgrown Excel.

ERP isn’t always the answer. If you sell from one location, hold little stock and invoice a handful of customers a month, a good accounting package may still be enough.

How to choose an ERP in eight steps

Follow these steps in order. Don’t skip step 2: it’s what makes every later comparison fair.

1. Agree the reason. Write one paragraph on why you’re doing this and what “better” means in 12 months.
2. Map your current flows. Quote to cash, procure to pay, stock control and month-end, with the real document names your team uses.
3. Write requirements by function. Use the lists below. Mark each one must have, should have or nice to have.
4. Add your local requirements. Tax and the e-invoicing route, the language your documents must print in, your legal entities and your currencies.
5. Agree weights before you see a demo. Use the scoring table in this guide.
6. Build a long list, then shortlist three. Send a short request for information (RFI) to five or six vendors.
7. Run scripted demos with your data. Same script, same data, every vendor.
8. Score, check references and compare five-year cost. Then negotiate.

What should you require, function by function?

Write requirements as things the system must do, in your words. “Supports purchasing” proves nothing. “Receive 40 of 50 ordered units and keep the purchase order open for the other 10” can be tested in a demo.

Sales and CRM

• Companies, contacts and a sales team per account, with each salesperson seeing their own customers.
• A deal pipeline with stages you can rename, and reasons captured on lost deals.
• Field sales activity: visits, outcomes and follow-ups that land on someone’s calendar.
• Credit terms per customer (days and the date they count from) that flow into orders and invoices.

Quotations

• Quotations from your item catalogue, with line and document discounts, tax and shipping.
• Approval rules by amount, and a block on sending a quotation before it’s approved.
• Numbered revisions, so you always know which version the customer received.
• Your letterhead and layouts, including a second language where customers expect it.

Sales orders, fulfilment and invoicing

• Turning an accepted quotation and the customer’s purchase order into a sales order without retyping.
• Reserving stock when an order is confirmed, so sales can’t promise the same units twice.
• Partial deliveries with a delivery note for each, and invoicing only what was delivered.
• Customer receipts applied to several invoices, with receivables aging.

Purchasing and receiving

• Requisitions with approval, requests for quotation and side-by-side comparison of supplier offers.
• Purchase orders that print in the format your suppliers expect, called the local purchase order (LPO) across the Gulf.
• A goods received note (GRN) at the gate, with short, over and rejected quantities recorded with a reason.
• Supplier invoices checked against what was ordered and received. Ask exactly how the vendor’s three-way match works, and what happens to a price difference.
• Supplier payments and payables aging, if you want to pay suppliers from the same system.

Inventory and warehouses

• Stock on hand, reserved and available per item and warehouse.
• Transfers, write-offs with reasons and stock counts that post the variance.
• A costing method you can defend to your auditor: weighted average, FIFO or standard cost.
• Lot, serial or expiry tracking if you sell food, pharmaceuticals or serialised equipment. Many SME systems don’t do this well, so test it.

Accounting and finance

• A chart of accounts per company, with automatic journals from every stock and sales document.
• Accounting periods you can close, with nothing able to post into a closed month.
• Corrections that leave a trail (reversal and re-entry) rather than silent edits.
• The reports your auditor and bank ask for: trial balance, profit and loss, balance sheet and cash flow. Ask to see each one generated, not described.
• Tax reporting that supports your return, and bank reconciliation.

Reporting and day-to-day visibility

• A start-of-day view for each role: what’s late, what’s waiting for approval, what’s due.
• Exports to Excel or CSV for anything you can see on screen.
• Reports that respect permissions, so a salesperson’s report shows only their own numbers.

What should you check if you trade in the UAE or Saudi Arabia?

Generic ERP checklists treat tax and language as configuration. In the UAE and Saudi Arabia, and across the GCC, they often decide the shortlist. Small and medium businesses carry much of the Gulf economy: the UAE Minister of Economy put the number of SMEs at 557,000 at the end of 2022, contributing 63.5% of non-oil GDP, and Saudi Arabia’s Monsha’at counted 1.7 million active commercial registrations at the end of Q2 2025. Many of these businesses are now meeting VAT, e-invoicing and corporate tax rules that spreadsheets were never built for.

VAT

Value added tax (VAT) is 5% in the UAE (since 1 January 2018) and 15% in Saudi Arabia (since 1 July 2020). Bahrain charges 10% and Oman 5%, while Qatar and Kuwait don’t charge VAT. Rates change, so confirm them with the tax authority when you read this.

Require:

• Tax codes per country, with dated rates, so a future rate change can be loaded in advance.
• Input and output VAT posted to separate accounts on every purchase and sales invoice.
• Correct VAT when a document discount applies.
• The VAT reports you need to prepare your return. Ask whether the system files returns or only prepares figures.

E-invoicing mandates

E-invoicing means issuing invoices as structured data that a tax authority’s platform receives or clears, not as PDFs. Both large GCC markets now require it.

Ask every vendor:

1. Does your product generate compliant e-invoices itself, or through a named partner or ASP?
2. Which documents are covered: tax invoices, simplified invoices, credit notes and debit notes?
3. Show me an invoice going through clearance or reporting, end to end, in a test environment.
4. Who is responsible when the authority changes the specification, and how fast do updates ship?
5. Is e-invoicing included in the price, or a separate subscription per invoice or per entity?

Don’t accept a vague promise without a date in the contract. If your ERP won’t issue e-invoices itself, budget for a specialist e-invoicing provider and ask how the two connect.

Arabic data and documents

Arabic matters in three places. Ask which one a vendor means by “Arabic support”.

• Data: Arabic customer, supplier and item names stored and displayed correctly, and found by search even with spelling variants.
• Documents: Arabic that prints with correctly joined letters and right-to-left order. Saudi VAT rules require tax invoice details in Arabic, with other languages allowed alongside.
• Interface: menus and screens in Arabic for staff who prefer it.

Ask the vendor to print a quotation and a tax invoice with an Arabic customer name and Arabic item descriptions, then search for that customer with a different spelling.

Several companies across the UAE and Saudi Arabia

Many Gulf groups run a UAE company and a Saudi subsidiary, sometimes with a free-zone entity as well. Each legal entity needs its own registrations, currency, VAT codes, numbering and books. Group management still wants one view.

Require:

• Separate books per entity in one system, with an easy way to switch between them.
• Access limited to the entities each person works in.
• Financial consolidation into one group currency, with the translation method shown.
• A clear answer on intercompany: how sales between your own companies are recorded and eliminated.

Local procurement documents

Gulf traders buy on an LPO, receive against a supplier’s delivery note, record a GRN and often raise a quick local purchase request for small items. A system that only knows “purchase order” and “receipt” forces your team to translate every day. Ask the vendor to show your document names on screen and in print.

Currencies, including three-decimal ones

If you trade with Kuwait, Bahrain or Oman, your system must handle currencies with three decimal places (KWD, BHD, OMR) without rounding errors. Ask for:

• Any currency per document, with the exchange rate stored on the document.
• Realised exchange gains and losses posted automatically when a foreign-currency invoice is paid.
• What happens when a rate is missing. A system that silently guesses is a risk.

Registrations, addresses and record keeping

• Registrations: the tax registration number (TRN) and trade licence in the UAE; the commercial registration (CR), VAT number and unified number in Saudi Arabia.
• Addresses: the structured Saudi national address (building number, street, district, postal code, additional number), with Arabic fields.
• Retention: UAE corporate tax rules generally require records to be kept for 7 years after the tax period, and Saudi VAT rules for at least 6 years. Confirm the periods that apply to you with your tax adviser, then ask how long the vendor keeps your data and how you get it all back.

What should you ask about deployment, security and data?

Ask for written answers. A good vendor answers these in a page.

If you trade in Saudi Arabia, its Personal Data Protection Law has been fully enforceable since 14 September 2024. Ask how each vendor supports it, and how they handle the data protection rules in every other country you operate in.

How should you approach implementation?

Choose the implementation approach before you choose the vendor, because it changes the cost and the risk. Panorama Consulting’s 2026 ERP Report found that more than a quarter of organisations exceeded their project budgets, most often because they needed additional technology they hadn’t planned for. That is usually a gap that should have surfaced in the demos.

Decide:

• Who implements. The vendor, a certified partner or your own team. Ask for the names and experience of the people, not just the firm.
• Big bang or phased. Going live with everything at once is faster but riskier. A phased start (for example sales and inventory first, then accounting) is common for SMEs.
• The cutover date. The date your opening balances are struck and the new system becomes the book of record. Month-end or quarter-end is easiest.
• Data migration scope. Usually open items and balances only, not years of history.
• Your internal owner. One person with the authority to make process decisions. Without one, every decision waits for a meeting.

For a phase-by-phase plan, use our ERP implementation checklist.

What does an ERP really cost? Total cost of ownership

Compare the total cost of ownership over five years, not the first-year quote. Licence or subscription fees are only one part of the real cost. Build this table for each shortlisted vendor.

Ask each vendor to fill in the same table. Where they leave a line blank, assume the cost is yours.

How do you build a vendor shortlist?

Start wide, cut fast and keep the evaluation identical for every vendor.

1. Long list (5–8 vendors). Mix global suites, regional vendors and newer cloud products. Our ERP comparison hub is one place to start; analyst lists and peers in your trade are others.
2. Request for information. Send your must-have list and your local questions. Ask for yes, no or partial against each line, with a sentence of explanation.
3. Shortlist three. Drop anyone who answers “partial” to a must-have without a credible plan.
4. Scripted demos. Two to three hours each, using the scripts below and your data.
5. Reference calls. Speak to two customers of similar size, in your region and trade, who went live in the past two years.
6. Hands-on trial or sandbox. Let your power users try their daily tasks for a week if the vendor allows it.
7. Proposal and contract. Ask for the five-year cost table, the implementation plan and named people.

Demo scripts: make vendors show your day, not theirs

A vendor’s standard demo shows what the product does well. A scripted demo shows whether it does what you need. Send the scripts and a sample data file a week ahead, and ask every vendor to follow them in the same order.

During each demo, keep a list of every answer that was “we’d configure that” or “that’s in the next release”. Those answers are your real gap list.

Scoring table

Agree the weights with your leadership team before the first demo, so the result isn’t argued after the fact. Score each criterion from 0 to 5, multiply by the weight and divide by 5. The maximum is 100.

Scoring scale: 0 = not available. 1 = only through custom development. 2 = through an add-on or a workaround. 3 = standard, with gaps. 4 = standard and shown with your data. 5 = standard, shown with your data and confirmed by a reference customer.

Adjust the weights to your business. A distributor with five warehouses may weight inventory at 15; a holding company may weight multi-entity at 15. Keep the total at 100.

Red flags in ERP selection

Walk away, or slow down, when you see these:

• The vendor won’t run your script and keeps returning to its standard demo.
• E-invoicing is promised for later, with no date, no partner and no contract commitment.
• “Arabic support” (or support for any second language) turns out to mean only the interface, or only the data, when you need printed documents.
• Every gap is answered with “we can customise that”, with no price.
• Implementation is priced before anyone has seen your processes.
• References are all from other regions or trades, or all went live more than three years ago.
• Financial statements, tax reports or bank reconciliation need a separate product that wasn’t in the quote.
• The contract has no clear exit terms or data export.
• The vendor can’t name the people who will implement your project.
• Pricing depends on modules you don’t need being bundled in.

Where does 1flux fit?

1flux is one of the systems you might shortlist. Here’s how it answers the questions in this guide.