Back end system defined:

To define back end systems we must understand the business terms: front end and back end in general retail.

Front end is defined by departments or employees who have direct customer contact. These are call center, customer service, and marketing reps.

Back end then applies to those who work in the warehouse and fulfill orders, but do not deal with buyers.

Back end systems are used for all phases not connected to the customer.

They are used to keep track of orders, dropship supplies, and inventory. These are corporate programs that maintain communication between the warehouse, dropship order fillers, and customer service employees.

Types of back end systems:

E-commerce: For online sellers, these systems help manage inventory, customer, and shipment tracking; build and support custom-made web sites; increase search engine optimization (SEO); and handle email.

CRM: Communication is provided to call centers and customer service employees

Order management: Keeping track of all products as well as items needed to fulfill orders plus all sales transactions.

Pricing engine: Keeps prices at competitive levels, offers free shipping, discounts on items, and all other pricing concerns.

Purchasing: Handles all functions when purchasing inventory, etc.

Inventory: Keeps track of all items in the warehouse.

Choosing a back end system

Though it may seem tempting to choose the system that sounds most appealing, there are steps you must take:

Organize the project: This means selecting the people who will make decisions and represent all operating functions. This person or group must be well disciplined, well organized, and can keep the system running on schedule and within budget.

Define your business needs: Every company has unique needs and requires a special system to meet them. Business functions are sorted according to importance - the most critical needs first. Many businesses need to hook up with other systems so this must be considered as well.

Compare multiple vendors: Just like hiring a contractor to build your home, you need to compare the services of several vendors. Give each one a detailed document of all your business requirements and get back in writing what each will do for you. Choose the one who will come closest to fulfilling your needs. Also get references of other companies they have served in the past.

Find out their ROI: Return on investment, or the amount of savings and benefits you can expect from using their system. How long will it take you to recoup the money spent on their system?

To the reader:

This article is a basic guide to back end systems. Those working in management who need to choose a back end system are given pointers on how to do so. Choosing a system is not an easy task and each must seek the assistance of those who have expertise in running a business.