Retail ERP: what shops need, costs and how to choose

What a retail ERP does for a shop

A retail ERP is one system that connects the till, the stock in every shop, purchasing and the accounts, so a sale at the counter reduces stock, records VAT and reaches the ledger without re-keying. To run one well you need a till that records the VAT rate on every line, stock held per location, and a daily cash-up that reconciles to the bank.

Small retailers usually start with a standalone till app and a separate bookkeeping package. That works until there is a second shop, a few hundred stock lines, or a VAT return that takes days because sales, refunds and stock costs live in different places. A retail ERP replaces the hand-offs between those tools with one set of records.

This guide explains what UK retailers should require from retail ERP software, the VAT rules that shape the till, how to compare systems and what they cost. One section at the end covers Skyline Nexus ERP.

POS, accounting software or retail ERP: which do you need?

The three are often confused, and the right answer depends on how many shops and stock lines you have, and on whether anyone needs margin and stock figures during the month rather than after the year-end count.

• A till (POS) app on its own: enough for one shop with a simple range, if you are content to send daily totals to your bookkeeper and count stock by hand.
• Accounting software plus a till: suits a single shop where the till exports a daily summary and stock is valued once a year at the count.
• A retail ERP: needed when you have more than one location, stock that moves between shops, purchase orders to suppliers, or managers who need margin and stock reports by shop.
• A retail ERP with an online shop: if you also sell online, check whether the web shop is part of the same system or connected through an integration, and who maintains that link.

Requirements checklist for retail ERP software

Score every system against the same list. The first six items matter to almost every shop; the last two depend on your format and customers.

• A till screen that is fast for cashiers, works with a barcode scanner and records the payment method on every sale.
• Cash registers opened with a float and closed with a counted total, with a register report per cashier.
• Stock per shop and warehouse, with transfers between them and reports for stock value, stock movement, slow-moving and dead stock.
• VAT per line at the correct rate, refunds that reverse VAT and stock, and a VAT report for each return period.
• Purchasing: supplier orders, goods received, supplier bills and returns to suppliers.
• Sales posted to the ledger automatically, so profit and loss and the balance sheet are current without month-end re-keying.
• User roles: who may give discounts, change prices, refund or see purchase prices, and which shop each user can work in.
• Optional: weighing-scale barcodes for loose goods, quotations and invoices for trade customers, and customer records for marketing.

VAT rules that shape a UK retail system

UK VAT has a 20% standard rate, a 5% reduced rate and a 0% zero rate, and many shops sell at more than one rate, so the till must store the rate on each line. Registration is compulsory once taxable turnover for the last 12 months goes over GBP 90,000, or is expected to go over it in the next 30 days.

Retailers have two simplifications. A retailer only has to issue a VAT invoice if the customer asks for one, and for a supply of GBP 250 or less including VAT a simplified invoice is enough: your name, address and VAT number, the time of supply, a description, and for each rate the total including VAT and the rate charged. HMRC also offers three standard VAT retail schemes, Point of Sale, Apportionment and Direct Calculation, which let you work out VAT once per return instead of sale by sale. A business with turnover above GBP 130 million must agree a bespoke scheme, and retail schemes cannot be used with the Flat Rate Scheme.

Making Tax Digital for VAT applies to VAT-registered businesses: specified records must be kept in functional compatible software, and data must move between programs by digital link, so till totals typed into a spreadsheet by hand do not meet the rules. Looking further ahead, the government has announced mandatory e-invoicing for VAT invoices from 2029, with a roadmap to follow; check how it will affect the invoices you issue to trade customers.

Stock control in retail: counts, shrinkage and dead stock

Stock is usually a retailer's largest asset, and the gap between what the system says and what is on the shelf is where margin disappears. A retail ERP should let you count one category or one shop at a time, post the differences as adjustments with a reason, and show the value written off each month.

Valuation matters too. Under FIFO (first in, first out) each sale is costed at the oldest purchase price still in stock, which keeps the stock value close to recent prices. IAS 2 and FRS 102 permit FIFO or weighted average cost; LIFO is not permitted under either.

Review slow-moving and dead stock every month. Cash tied up in lines that have not sold for six months is cash you cannot spend on lines that do sell, and the earlier you mark down, the more you recover. A simple routine keeps the figures honest:

• Cycle-count high-value and high-theft lines weekly.
• Count each shop fully at least once a year, at the year-end if possible.
• Record every transfer between shops with a status, so stock in transit is not lost between two counts.
• Investigate any adjustment above an agreed value before it is posted.

Cash-up and till control

Every till should end the day with a cash-up: the opening float plus cash sales, minus cash refunds and payouts, equals the expected cash, which the cashier then counts. Card takings are checked against the settlement the card acquirer pays into the bank, usually a day or two later and net of fees, so the system should hold card sales in a clearing account until the money arrives.

Small differences are normal; patterns are not. A system that shows cash differences per cashier and per register over several weeks is one of the most practical controls against theft and error a shop has, and it costs nothing once the till and the ledger share the same records.

Worked example: one week in a two-shop retailer

A homeware retailer has shops in Leeds and York. All its goods are standard-rated at 20%, so the VAT inside a VAT-inclusive price is one sixth of it.

Without one system, each figure below comes from a different place: till reports, a bank statement, a count sheet and a spreadsheet. With a retail ERP they come from the same records, and the week's VAT is already in the VAT report.

• Leeds takings: GBP 12,000 including VAT, of which cash GBP 1,840 and card GBP 10,160.
• Leeds VAT: 12,000 / 6 = GBP 2,000, so net sales are GBP 10,000.
• Leeds posting: Dr Cash 1,840 / Dr Card clearing 10,160 / Cr Sales 10,000 / Cr VAT output 2,000 (debits 12,000 = credits 12,000).
• York takings: GBP 6,000 including VAT; VAT GBP 1,000; net sales GBP 5,000.
• Both shops: net sales GBP 15,000; cost of goods sold at FIFO GBP 9,000; gross margin GBP 6,000, which is 40%.
• Leeds cash-up: float GBP 150 + cash sales 1,840 = expected 1,990; counted 1,975; shortage GBP 15, recorded against the register.
• York count: system 240 candles, shelf 232; 8 units at a cost of GBP 6.50 = GBP 52 of shrinkage, posted as a stock adjustment.
• Week result: margin 6,000 less shrinkage 52 and cash shortage 15 = GBP 5,933 before overheads.

How to choose retail ERP software

Demos look alike; the differences show up when you test your own busiest day. Ask every vendor the same questions, and use a free trial with your own products and prices rather than the demo data.

Free or free-download retail ERP products exist, usually as open-source software you host yourself or as a basic till app with paid add-ons. They can suit a single shop with technical help on hand; count hosting, support and set-up time before treating them as free.

• How fast is a ten-item sale with two barcode misreads and a card payment?
• Can a manager see today's sales and stock by shop from the back office, while a cashier sees only their own shop?
• What happens at the till if the internet connection drops?
• How are refunds and exchanges handled, and do they reverse VAT and stock correctly?
• Which reports show slow-moving stock, shrinkage and margin by category?
• What does each extra till, user or shop cost, and what is the price after any introductory offer?
• How do you send VAT figures to HMRC under Making Tax Digital?
• How do you export all your data if you leave?

What retail ERP costs

Retail ERP pricing is usually per user, per till or per location, with modules such as stock, purchasing or multi-store charged separately. Compare the cost of the first 12 paid months at the price you will pay after any offer ends, and add card-terminal fees, hardware such as scanners, receipt printers and cash drawers, and set-up time. A VAT-registered retailer can normally reclaim the VAT on its software subscription.

For reference, Skyline Nexus ERP Solo costs GBP 15 a month plus VAT (GBP 18 including VAT at 20%) for one user and one business location, with POS, inventory, purchasing, accounting and VAT reports in the plan. A retailer with several cashiers on their own logins, or more than one shop, needs a larger plan such as Core; prices are on the pricing page.

Every plan starts with a free first month. Under the launch offer, valid until 31 January 2027, Solo costs GBP 7.50 a month for the first 3 months on monthly billing, so the first 12 paid months cost 3 x 7.50 + 9 x 15 = GBP 157.50 instead of GBP 180; on annual billing, GBP 150 covers 15 months. Prices were checked on 3 October 2026; confirm them on the pricing page.

Skyline Nexus ERP for retail

Skyline Nexus ERP includes a POS with cash registers and a Register Report, drafts, quotations, discounts and weighing-scale integration for loose goods. Each business location has its own invoice numbering for POS sales, its own simplified-invoice layout and its own payment methods, each with a default account. Stock is held per location, with reports for location stock, stock valuation, stock movement, stock ageing, dead and slow-moving items and physical stock verification, and stock transfers between shops carry a status of pending, in transit or completed.

Cost of sales uses FIFO, so each sale consumes the oldest purchase lot. With auto-posting switched on, every final sale and sales return posts to the general ledger in the background, with output VAT computed per line on the same basis as the tax report; returns are credit notes that reverse revenue, VAT and cost of sales. Roles control discounts, price edits and who can see purchase prices, each user can be limited to their own shop, and bank statements are imported as CSV or XLSX files for bank reconciliation.

VAT reports and a prefilled VAT return form give you the figures, which you submit through MTD bridging software or your accountant's MTD software while direct MTD filing is being rolled out. Start the free first month on Solo at GBP 15 a month plus VAT with your own products, or book a demo if you run several shops.