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Discovering ERP Tiers


As part of the process of selecting and ERP system that will suite your business it is important to determine the tier you belong to so you can be sure you are exploring the correct products. This will assist you in scaling down all the options when it comes to selecting a package. Generally the Tier you fall into is determined by the number of employees you have and the amount of revenue you generate. It goes without saying though that this is not a fool proof method as some companies have quite complex business processes but not very many employees, but as a start we will stick to the basics. ERP software can be categorised into 4 Tiers.

Tier 1 ERP

Tier 1 ERP software is the "Big Daddy" of ERP. It is for the large enterprise, multi-national, multi-site corporations with revenue in excess of $200 million. These sites would be looking at products like SAP, JD Edwards, Baan, Oracle and Peoplesoft. Microsoft Dynamics AX is also borderline Tier 1.

Tier 2 ERP

Customers of Tier 2 software have a revenue ranging from $20 million to $200 million and are usually a few localised sites. Generally there would be less than 100 users, but this is not to say that smaller companies with few users but complex, labour intensive business processes would not benefit from Tier 2 ERP software. Software in this class includes Microsoft Dynamics NAV, Epicor Vantage, Infor's Sytelin and a good few others. Don't be misconceived into assuming that Tier 2 ERP software is not for you as it would be too expensive, it is definitely worth looking into for future growth.

Tier 3 ERP

This software is designed for businesses with under $40 million in revenue. Generally single site with 5 to 30 users. Microsoft GP, Intuative Manufacturing, DBA software and the like fall into this category.

Tier 4 ERP

This tier covers you basic accounting systems. Accpac, Quickbooks, MYOB and the like. This software suites companies with up to $2 million in revenue.