If you’re wondering when to swap accounting software for an ERP, this post is for you.

Xero, QuickBooks, and their add-ons are fantastic tools.... until they aren’t.

Most finance leads in fast-growing startups hit a point where the software that once made life easier starts to slow everything down. Reporting gets messy. Data lives in too many places. Inventory’s a mess. Your CEO wants numbers you can’t get fast enough.

At some point, the question isn’t if you need an ERP. It’s when.

This post will walk you through what an ERP system actually is, how to know when you're ready, and what I’ve learned from helping founders and finance leaders swap accounting software for an ERP the right way.

What's an ERP Anyway?

Let’s start with basics.

ERP = Enterprise Resource Planning. It’s a fancy name for a central system that ties together your finance, ops, supply chain, HR, and reporting.

Think of it as your finance system, inventory tracker, BI tool, and project planner all rolled into one. It replaces your growing web of disconnected tools and becomes a single source of truth.

But be warned; swapping accounting software for an ERP isn’t a small job.
ERP systems are complex, expensive, and take 6–12 months to implement properly.

So before you dive in, you need to be sure the business is ready.

How to Tell if You've Outgrown Your Accounting Software

So how do you know when it's time to level up from your accounting software to a full-blown ERP system?

Here are some tell-tale signs:

1. Reporting is Broken

Let’s be honest: the moment you have to download five CSVs just to get a gross margin report by product, you’ve outgrown your system.

The number one reason startups swap accounting software for an ERP is reporting. If you:

• Manually build monthly board packs in Excel (although try to use tools like Fathom / Spotlight for as long as possible first)
• Struggle to report by product, region, channel, or team
• Find that your ops and finance numbers constantly disagree

Then it’s time to upgrade.

ERPs allow for fast, drillable, customisable reports with clear segmentation and real-time data. That alone can save you hours and build trust in the numbers.

2. Your Data is Scattered (And It's Slowing You Down)

If your finance team is constantly chasing numbers across systems, you’re wasting time and introducing risk.

Customer data in Shopify. Invoices in Xero. Forecasts in Google Sheets. Stock levels in a WMS bolt-on that barely talks to anything else.

You’ve got data silos. And every one of them adds friction.

ERPs bring these data sets together. Clean. Aligned. In one place. If you’ve gone through a merger, added new business lines, or are scaling internationally then this kind of control is essential.

3. Manual Errors Are Becoming a Problem

Manual processes = mistakes.

If your month-end is filled with copy-paste errors, reconciling manually, or fixing broken formulas then you’re not alone.

Finance teams hit a ceiling when their tech stack can’t support automation. An ERP brings:

• Automated matching
• Built-in approvals
• Real-time dashboards
• Clear workflows

It doesn’t reduce headcount but it frees you up for value-add work like cash flow planning, analysis, and commercial partnering.

4. Inventory is a Nightmare

For product businesses, inventory is often the trigger point.

When you’re tracking stock across warehouses, marketplaces, and suppliers using spreadsheets (or a patchy plug-in) then things go wrong. Orders get missed. Stockouts happen. Gross margin fluctuates and no one can explain why.

Modern ERPs with WMS features solve this. You get:

• Real-time inventory tracking
• Integrated order management
• Margin by SKU and channel
• Automated reordering rules

If your ops and finance teams are constantly clashing on what’s actually in stock then this is your fix.

5. You’re Scaling, and Your Systems Aren’t

Maybe you’ve just closed a round. Or opened in a second country. Or hired 20 new people.

Whatever the reason, your business has changed. And Xero just isn’t cutting it anymore.

When I help founders swap accounting software for an ERP, this is usually the moment they’ve hit:

• Multi-entity consolidation is manual
• Foreign currency is error-prone
• Departmental reporting is unclear
• Audit-readiness is a nightmare

You don’t need a huge team to need an ERP. You just need enough complexity to make your current setup a liability.

What to Know Before You Switch

Swapping accounting software for an ERP isn’t just a tech decision, rather it’s a business transformation project.

Here’s what to get clear on before you start:

• Have a strong internal lead and someone who will own the migration end-to-end
• Clean your data and don’t import garbage
• Define what success looks like.  What will this ERP enable that you can’t do today?
• Choose wisely: NetSuite, Odoo, SAP, and others all have pros and cons
• Budget for more than money as you’ll need people, patience, and lots of time!

Done well, an ERP won’t just replace your accounting system, it will level up your entire finance function.

If you’re a finance leader in a startup and you’re starting to feel like the numbers just aren’t flowing right then it might be time to swap accounting software for an ERP.

But don’t rush. Make sure the business case is clear. Build the right internal team. And be realistic about the work involved.

Want to become a confident, strategic finance leader in a startup within the next 12 months? 

Here’s your plan:

1. Subscribe to my YouTube channel for weekly practical tips and real talk about startup finance leadership.
2. Read my book Financial Leadership Fundamentals to get clear on what’s expected of you and how to show up as a leader.
3. Join the Financial Leadership Fundamentals course to fast-track your growth with structure, support, and strategy that works in the real world.