Cloud ERP Software

What Is Cloud ERP Software? | Best Cloud-Based ERP Software in 2023

By Team TranZact | Published on Nov 26, 2022

Companies across the globe prefer cloud ERP software over legacy ERP solutions, and prefer to store and manage their most confidential and essential data on the cloud.

This is because Legacy ERP solutions cannot keep up with dynamic customer demands. Their outdated operating systems lack flexibility, advanced capabilities like cross-functional integration and pose data security challenges. These are some of the primary reasons businesses are switching to cloud-based ERP software.

In this blog, we will walk you through the basics of cloud computing, its importance, features and benefits. And why you should move to a cloud-based ERP tool, if you haven't already.

You will also learn about the security aspect of such software, and read about the best ERP software for manufacturing in India to choose from. Let's begin!

TranZact - Best Inventory Management Software

What Is Cloud ERP Software?

A cloud-based manufacturing ERP software is an Enterprise Resource Planning (ERP) software that lets you access, manage, store and collaborate with all functions of your business, and automate critical business processes on a vendor's secured server.

Similar to legacy ERP software, a cloud ERP system is a SaaS ERP that focuses on managing and automating regular business processes for companies. Except that it is based on the cloud and is not an on-premise hosting.

A cloud-based ERP system is easily accessible to you via the internet and offers you state-of-the-art functionalities required to create a friction-free workflow within organizations.

Such software is hosted on the service provider's computing platform and operates on a secure server. A cloud-based ERP focuses on integrating all essential processes like purchase, sales, inventory, production, accounting, material planning and other functions.

It facilitates varied manufacturing activities like easy purchase planning, real-time monitoring of purchase and sales orders, production planning, testing and more.

The best cloud ERP software is beneficial for an SME business since it eliminates the requirement of hosting a complex ERP system on-premise. This cuts operational costs as businesses would not have to bear added management and maintenance costs.

How Does Cloud ERP Work?

A cloud ERP software offers a package of several enterprise automation modules for businesses to access over the internet. They do not require users to download heavy on-premise ERP packages.

It is completely based online and is created with a combination of expert software technologies, supported by high-speed internet broadband connections. It enables users to appropriately manage inventory, finances, manufacturing processes, purchase and sales.

It assists you in keeping track of your sales history, automates the creation of GST-compliant documents, and also helps you supervise your company's overall performance via reporting dashboards. The ultimate aim of a cloud ERP is to integrate all departments and their processes on a single web platform where they can be performed, monitored and also streamlined with minimal manual effort.

By ensuring the integration of organizational data, a cloud-based ERP system primarily reduces the resources needed to perform different manufacturing activities. This includes tasks like creating invoices, tracking the status of quotations, follow-ups on inventory movement, and more, with an efficient system that automates these processes.

The biggest perk of a cloud ERP is that you can store all company data in a single web-based repository, where each employee with access, can leverage the same without cumbersome manual procedures.

Why Should You Choose a Cloud-Based ERP Software?

Cloud ERP systems for small business can bring many productivity advantages. Most importantly, a cloud-based software does not require a huge upfront investment. Instead, a minimal subscription fee is all you have to pay to get access to the system and get started.

Ease of accessibility is another major advantage of cloud-based ERP systems. Today, physical limitations and organizational boundaries are reducing, with virtual tools ensuring that work can be completed from anywhere. This enables business owners to leverage global talent pools. Therefore, on-premise structures may not always fit in with business requirements.

Moreover, unlike an on-premise setting, a cloud ERP tool allows you to always test and try the solution you are opting for, instead of risking your money and investing in infrastructure and servers right away.

Above everything, a cloud-based ERP software is an alternative that offers better returns and performance in the long run, too, as it eliminates every possibility of human error by automating several time-consuming business processes.

Importance of Cloud ERP for SME Businesses

SMEs are on the lookout to explore new tools to mitigate the risks of paper-based documentation like mismanagement, lost documentation and overlapping activities. They need a centralized manufacturing system that promotes integration, transparency, reduces silos and helps them to reach their true growth potential.

Following factors emphasize on how a cloud-based ERP system is important for SMEs to resolve these challenges:


The growth plan for SMEs is very dynamic with operations and initiatives changing every day, and their scope of growth is also broader. Thus, it’s important that a scalable software is leveraged to match small and medium enterprises' requirements.

A cloud ERP system is built to scale with SMEs and makes it easy for them to proceed with the transition as and when it happens. With no physical limitations, the power of the cloud can be tapped whenever the business seeks to expand. The software can be chosen based on the requirements, metrics and goals of the SME businesses.

Cost-efficient alternative

A cloud ERP system is relatively cost-efficient compared to other alternatives in the market that require businesses to invest in infrastructure and hardware.

Since SMEs are constantly keeping a track of their costs, it’s important for them to keep a tab on the return that software investments generate.

Compared to expensive ERP tools demanding high upfront payments, a cloud-based ERP tool does not burden a small business with unaffordable charges. Moreover, the right cloud ERP provides an SME with high returns in the form of productive workflows, on their investment.

Suits modern business requirements

To deliver the best to consumers, businesses also need to upgrade to the best internal tools. A ledger and excel tools are not always capable to suit modern manufacturing requirements, without causing delays and errors.

Today, businesses are scaling and targeting diverse consumer segments with their products. In addition, there are several stringent compliances that companies have to deal with every day.

In order to keep up with these growth strategies and compliances, a proper online ERP management system is essential, which can support businesses to avoid legal and financial issues. A cloud-based ERP is also the best solution to help you manage your end-to-end manufacturing processes with near-zero human errors and duplication.

Key Features of Cloud ERP Software

A cloud-based ERP system comes with the following features, needed to transform your business:

Sales management

A cloud-based ERP system comes with a sales management module, enabling you to have an overview of all sales transactions at one place. It should allow you to create GST-compliant documents, track the status of sales orders and deliveries.

It will also help you monitor all these processes in real time via a dashboard so you can quickly spot any discrepancies and rectify them without delays.

Production management

An efficient cloud-based ERP system empowers you to manage all production stages with the help of multilevel bill of material, while ensuring you keep a close look at the processes via available reports and data.

Purchase management

The entire purchase management process requires your team to do a lot of back and forth with vendors, management, and staff. A cloud-based ERP offers you the potential to automate this with the help of digitization features.

With this tool, you can monitor the status of these transactions in real time and simplify the process of reminders and follow-ups.

Inventory management

Inventory management is a key function for manufacturing businesses. It’s important that the ERP system can detect inventory errors in time to avoid disruption to production cycles.

A cloud ERP monitors unavailability of raw materials and creates live alerts to order raw materials when required, to control losses.

Benefits of Cloud ERP Software

Following are a few benefits of a cloud-based ERP system that you simply cannot ignore:

  1. Quick implementation is one of the most significant benefits of cloud-based ERP software. Unlike a legacy ERP system, you wouldn't have to wait for weeks to get proper IT support or select the appropriate hardware.

  2. Configurability is another advantage that comes with cloud-based software. They are flexible and can be adjusted per the needs of different businesses.

  3. Cloud-based systems are also immune to losses such as hardware failures. Since recovering from such damages will cost businesses a lot of money, it's best to be safer.

Is Cloud ERP Secure?

Amid a discussion about cloud ERP, it's crucial to answer questions related to the safety of a SME’s business data. Cloud-based systems are indeed safer, as they are centrally managed over high-end, secure web platforms.

Cloud systems are known to deploy the best industry security practices to protect your business from any security threats and data breach. Most platforms also have an internal team that dedicatedly focused on ensuring a secure system for your business, along with ensuring compliance with advanced encryption technologies.

Cloud ERP software is equipped with security features including HTTPS protocols, access controls, digitized infrastructure, and web data protection tools. In addition to these, cloud-based ERPs also offer internet endpoint security to users.

Moreover, cloud-based ERPs keep your enterprise data secure by leveraging high-grade firewall protections, multilevel encryption, and multilevel authentication systems. Unlike on-site ERP systems, cloud-based ERPs constantly upgrade themselves with the latest security updates, quickly fix system vulnerabilities and prevent hackers from leveraging them.

Best Cloud-Based ERP Software In India

When you’re choosing the right software for your business, you must thoroughly review and choose the one that fits your business requirements.

We have identified the below cloud-Based ERP software used by Indian businesses for your reference:


TranZact is an intuitive and easy to use cloud-based business automation tool, digitizing end-to-end operations for SME manufacturing businesses. It offers all solutions that an automated ERP system offers, but it also offers several advanced features that make it significantly more powerful than an ERP.

It automates all activities within sales, purchase, quotations, inventory, material planning and production modules. In addition, it offers Tally integration, to enable and manage easy accounting data outflow, business intelligence and reporting dashboards for data-driven insights and top-notch customer support.

It also offers other important features such as inventory barcoding, vendor mapping, Google Sheets integration and Aftership Integration for increased business convenience.


This cloud-based ERP software offers an inclusive system with modules that manage activities across departments like finance, inventory, supply chain management, and more. The major drawback of this alternative is that it does not offer ease of integration and a free trial to test the software for its users.


EPPS offers both cloud-based and on-premise deployments that can help simplify complex processes for businesses. The software offers automation in internal business processes. However, their pricing is quote based.


ERPNext is an open-source platform and is created to manage processes like production, procurement, and finances and offers both cloud-based and on-premise hosting.

One of the major challenges of this software is that you will need to invest in additional workforce to manage on-premise hostings. Also, the software is complex when it comes to approvals and permissions.

Tech Cloud ERP

Tech Cloud ERP is a cloud-based ERP solution that incorporates modules such as sales, customer relationship management, warehousing, and inventory, which is explicitly created to cater to the needs of mid-sized and large businesses.

However, this software is not very scalable for large enterprises and doesn’t offer a free trial.

Get Started with TranZact - The Best Cloud-based ERP Software for Manufacturers

Complex ERP functionalities may hinder ease of use, and struggle to meet the demands of a growing SME. It’s important to adopt an ERP tool that is simple, is flexible for SME needs and understands the industry that you operate in.

TranZact is a trusted cloud-based tool offering ERP solutions. It is very easy to use and specially designed to cater to the needs of SME manufacturing businesses. It offers a free sign up for all users, wherein users can explore the software for an unlimited free period. They can choose to upgrade to advanced features only when they’re ready!

Automate Your Manufacturing Processes With Cloud ERP

Cloud ERP solutions can empower you to manage your regular business operations in an extraordinary way. A cloud ERP acts as a one stop digitization tool to help you streamline core processes.

It processes large amounts of enterprise data for an SME and organizes key workflows, making it easier for manufacturing business owners to monitor performance and identify bottlenecks. Real-time production, transactions and inventory insights accelerates manufacturing and delivery functions for an SME, and provides value-driven control.

TranZact's cloud-based ERP solutions help your teams to process documents in just a few clicks, automate all functions from sales inquiry to dispatch and offer rewarding customer experiences!

FAQs on Cloud ERP Software

1. Why is Cloud ERP better?

A cloud-based ERP helps you to save costs and maximize revenue by eliminating the need for added resources and equipment. It effectively automates repetitive processes to ensure your teams have time to focus on important activities. It's more scalable and flexible, which is the most important requirement for SME businesses today.

2. What is the cost of ERP software?

Cloud ERP systems are relatively cheaper as opposed to legacy ERP systems. There are free trial options available in the market too.

3. When should you implement ERP software for your business?

If you have a business that's scaling consistently and managing your daily operations appears to be a hurdle, that’s a sign for you to switch to a cloud-based ERP soon.

4. What are the common types of ERP?

There are three major types of ERPs:


It’s an ERP system that is hosted on the company's infrastructure under its own surveillance. Anything that goes wrong with such ERP hardware and software is entirely the company's responsibility.


In this scenario, the ERP deployment is partially on-premise and partially on the cloud.


A cloud-based ERP is accessible via the internet and is hosted over the vendor's server.

5. What is the difference between cloud ERP and on-premise ERP?

A Cloud-based ERP is different from an on-premise ERP based on the hosting structure. A cloud ERP is maintained on the vendor’s servers and is accessible via the internet. On-premise ERP, on the other hand, is maintained over the company's own infrastructure with the help of hardware and maintenance support.

6. How to choose the right ERP software?

While choosing an ERP for your business, ensure that it is cloud-based. Also, don't forget to look for features that will help you simplify complex business processes like inventory and purchase management. Your ERP software should support integration and transparency amidst all business functions!

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TranZact is a team of IIT & IIM graduates who have developed a GST compliant, cloud-based, inventory management software for SME manufacturers. It digitizes your entire business operations, right from customer inquiry to dispatch. This also streamlines your Inventory, Purchase, Sales & Quotation management processes in a hassle-free user-friendly manner. The software is free to signup and gets implemented within a week.