06 March 2023

The Essential Integration of ERP and Ecommerce Platforms for Optimal Sales Channel Management

The Essential Integration of ERP and Ecommerce Platforms for Optimal Sales Channel Management

Integration between ERP (Enterprise Resource Planning ) and the ecommerce platform is necessary for optimized management of all corporate sales channels. The online sale of a company's products/services in a B2B or B2C business model requires perfect synchronization of information and data within the corporate information system.

ERP can integrate all relevant business processes of a company:

  • Accounting
  • Management control
  • Personnel management
  • Purchasing management
  • Warehouse management (WMS)
  • Material requirements planning
  • Production management
  • Project management
  • Sales management
  • Distribution management
  • Plant maintenance management
  • Asset Management

The online sales channel especially B2B, requires continuous alignment of information about products, availability, price lists and orders.

Possible solutions for integrating an ecommerce with an ERP system are:

  • loosely coupled - asynchronous integration for B2C and simple B2B sales sites
  • tightly coupled - synchronous (real-time) integration for highly integrated B2B sites
  • hybrid scenario - asynchronous integration for B2B with partial integration with ERP

Business needs and management processes may require a synchronous or asynchronous solution. Below are descriptions of the different solutions, useful when choosing how to integrate with the ecommerce platform.

Loosely coupled scenario

The loosely coupled scenario constitutes an 'asynchronous integration between ecommerce and ERP. In this solution the ecommerce is autonomous and has total control of processes without having communication or data exchanges with the ERP (which does not have particularly complex logic). This is the most flexible solution and is suitable for ecommerce with high transaction volumes such as in B2C sales models.

In this scenario, the ecommerce is independent of the ERP and this ensures the best response time to customers or prospects at all touch points in the buying process.

The initial upload of master data is done by ERP and is then uploaded to ecommerce. This data step may require initial synchronization of products, availabilities, and price lists via data upload from file or via web service. In this case, an ad hoc warehouse is created with the products intended for online sale, and the ecommerce is able to manage this logistics with its own tools and processes.

After the initial loading, no further communication between ecommerce and ERP is required except for reassortments and loading new batches. The customer's purchasing process is handled exclusively by ecommerce. The order is created on the online store, which can potentially handle all subsequent order fulfillment activities (such as picking, shipping, and invoicing). If required, the order can be partially replicated on the ERP for tax and reporting purposes.

The Rewix ecommerce platform can support the loosely coupled solution. Rewix manages the entire ecommerce active cycle and uses the passive cycle processes for procurement and catalog management.
Rewix then manages the processes of:

  • Quote to Invoice (active cycle)
  • Partner Relation (CRM)
  • Requisition to Pay (passive cycle)
  • Wharehouse Management (order fulfillment)

of the online store.

Through the planned integration procedures, the initial upload includes

  • the loading of the initial catalog with the product assortment
  • the basic information of the product sheets
  • the practiced price list
  • the inventories, only in incremental mode (following stock replenishment)

Products are loaded as physical products to manage lot and stock information. In this mode Rewix manages logistics through its interface and order flow management is totally in-house.

Shipments are managed by Rewix, which integrates the courier(s) system.

The electronic invoice in XML format is issued by Rewix on a specific part(s) and the necessary tax data are transferred to the ERP.

Returns and missing items result in the generation of the credit note within ecommerce.

The ecommerce is independent of the ERP Ensures the best response time to end customers (necessary in B2C models) Especially suitable in case there is no heavy business logic
Orders are created and managed by ecommerce
The ecommerce issues invoices and DDTs

Tightly coupled scenario

At the other extreme in integration scenarios is tightly coupled, also known as synchronous or real-time integration with ERP. In this solution, e-commerce constantly communicates and exchanges data regularly with the ERP to verify information before taking action or confirming status changes. This scenario is inflexible and does not fit in b2c sales models where there are high transaction volumes but is more suitable in b2b sales models where there is a high dependence on the ERP with complex integration logic.

Integration begins with an initial upload of product and customer data for initial synchronization. During the buying process, there are constant and regular calls from e-commerce to ERP, which constantly requests key information such as:

  • product availability
  • the alignment of applicable price lists
  • customer or potential customer information such as credit checks
  • orders and invoices
  • returns and credit notes

A key difference is that no order is created in the e-commerce platform. The order is created directly in the ERP and this takes advantage of all the order management and processing procedures provided by the ERP. Invoicing and delivery is handled directly by the ERP, which provides through calls and data synchronization all information about changes in order status. Invoices are handled directly by the ERP, which then aligns them back into the e-commerce platform.

With synchronous integration, real-time information sharing between ERP and e-commerce is achieved and the complex business logic of ERP built on established business processes is used.

The Rewix e-commerce platform can support the Tightly coupled solution. Rewix in this integration does not handle product and order fulfillment in the logistics and billing processes. Through the API the data source feeds:

  • the product sheets
  • the virtual inventories

Products are loaded as virtual products, thus without actual availability, into a warehouse managed by Rewix. The availabilities are centrally managed by the ERP. When an order is generated in the online store, it is sent via API to the external ERP system. The management of Rewix's logistics and billing processes are completely disabled. From the outside, Rewix receives notifications of order status changes and receives tax documents. When an invoice is requested, it is generated using external APIs and the document is saved in Rewix. The credit note is generated by the external system, which communicates it to Rewix via API.

Integration is Real time Supports complex models by leveraging existing investments in ERP Typically used in B2B models

Hybrid Scenario

The hybrid integration solution falls somewhere in between the previous two solutions by delegating part of the processes to ecommerce and part to ERP. It is the most flexible ecommerce model and the most common in many implementations.

The shopping experience is always managed in ecommerce but not all key information and processes are managed directly by this tool.

After the initial loading of products asynchronously, product availability can be managed by ERP or e-commerce and all other information is selectively kept aligned between the two systems.

For example, through regular calls between the ERP and e-commerce, price and quantity alignments are made, but, on the other hand, as in the flexible synchronous model, the order is generated directly in the e-commerce and then replicated to ERP for further processing with very little response time.

Managing this scenario requires choosing which processes should be synchronous and which should be asynchronous. This combines the rigorous business logic implemented in ERP with the fast and flexible order management typical of e-commerce.

The Rewix e-commerce platform can also handle this hybrid solution. Rewix must be properly configured to manage products as physical or virtual and to select which fulfillment and administration processes to devolve to the ERP.

Synchronous and asynchronous steps are chosen It combines the functionality of Rewix with that of ERP It is the most popular approach

XRoads, il modulo di Rewix per gestire le integrazioni

To manage these various ERP integration solutions, Zero11 developed XRoads the Rewix ESB (Enterprise Service Bus) middleware module that manages all integration processes with third-party tools.

XRoads is capable of synchronizing and exchanging data streams by integrating major data sources automatically.

XRoads is a Java-based enterprise integration middleware (ESB) that is capable of handling data exchanges with web services and flat files (CSV, Excel, DAT) in FTP areas.

XRoads is customizable and can handle scheduled operations to ensure two-way synchronization of quantities, prices, and orders

XRoads is based on the open source Vert.x framework

Different solutions for different integration needs

If you enjoyed this blog post, be sure to check out our other blog posts on a variety of topics related to business process automation, enterprise resource planning (ERP), and ecommerce platforms. And if you have any questions or would like to learn more about our services, please contact us. We're always happy to help!

Thanks for reading! And until next time, keep automating! :)