The right ERP deployment model can make or break your distribution operation.
Understand the real differences in cost, security, scalability, and control — so you can choose with confidence.
Each deployment model offers distinct advantages. The right choice depends on your business size, IT resources, growth plans, and operational requirements.
Cloud ERP
Hosted and managed by the vendor in secure data centers. Access from anywhere with an internet connection.
Best For
Growing distributors, multi-location operations, and businesses without dedicated IT staff.
On-Premise ERP
Installed on your own servers in your own data center. Full control over hardware, software, and data.
Best For
Enterprises with dedicated IT teams, strict data sovereignty requirements, or existing data center investments.
Hybrid ERP
Combines cloud and on-premise components. Run core operations locally while leveraging cloud for specific functions.
Best For
Organizations transitioning from legacy systems, or those with mixed requirements across locations.
A side-by-side look at how cloud and on-premise ERP differ across the factors that matter most to wholesale distributors.
| Factor | Cloud ERP | On-Premise ERP |
|---|---|---|
| Upfront Cost | Low — subscription starts immediately No hardware or infrastructure investment |
High — servers, licenses, setup $50K–$500K+ depending on scale |
| Ongoing Cost | Monthly/annual subscription Predictable, includes updates and support |
Maintenance, IT staff, upgrades 15-22% of license cost annually + IT labor |
| Implementation Time | Weeks to months No infrastructure to build |
Months to years Hardware procurement, installation, configuration |
| IT Requirements | Minimal — vendor manages infrastructure Focus on business configuration, not servers |
Significant — dedicated IT team Server admins, DBAs, security specialists |
| Updates & Upgrades | Automatic — included in subscription Always on the latest version |
Manual — requires planning and downtime Major upgrades can be complex projects |
| Security | Vendor-managed, enterprise-grade SOC 2, encryption, 24/7 monitoring |
Your responsibility Depends on your IT security capabilities |
| Data Location | Vendor data centers (region options)May have data residency options | Your premises Full control over physical location |
| Scalability | Elastic — add users/capacity instantly Scale up or down as needed |
Limited by hardware Scaling requires new infrastructure |
| Remote Access | Built-in — any device, anywhere Mobile apps, web access standard |
Requires VPN/configuration Additional setup for remote workers |
| Customization | Configuration-based Deep customization may be limited |
Unlimited (with development) Can modify source code if needed |
| Disaster Recovery | Included — automatic backups, failover Geo-redundant by default |
Your responsibility Requires separate DR planning and investment |
| Internet Dependency | Required for all operations Offline modes vary by vendor |
Can operate on local network No internet required for core functions |
Illustrative example for a mid-sized wholesale distributor
*Illustrative figures. Actual costs vary based on vendor, scope, and organizational factors. Request a personalized TCO analysis.
Use these guidelines to match your operational reality with the right deployment model.
Choose Cloud ERP If…
Choose On-Premise ERP If…
Ximple ERP supports both cloud and on-premise deployment for wholesale distributors across industries.
High-volume POS, promotions, and B2B eCommerce
Compliance, FEFO, and age verification
Complex pricing, project quoting, and rebates
Seasonal inventory, warranties, and service
Multi-location inventory and contractor pricing
VMI, kitting, and complex fulfillment
High SKU counts and weight-based pricing
Route sales, equipment, and consumables
Yes. Leading cloud ERP providers invest heavily in security — often more than most businesses can afford independently. Look for providers with SOC 2 Type II certification, data encryption at rest and in transit, multi-factor authentication, and 24/7 security monitoring. For most distributors, cloud security exceeds what they could achieve on-premise with limited IT resources.
Yes, though the complexity varies by vendor. Some ERP systems are designed for both deployment models with clear migration paths. Others require significant re-implementation. With Ximple, the same core platform runs in both environments, making migration straightforward when you’re ready.
Cloud ERP updates are typically applied automatically by the vendor — often during off-hours to minimize disruption. This means you’re always on the latest version with current security patches. Most vendors provide advance notice of major updates and allow some scheduling flexibility for larger changes.
Cloud ERP implementations are typically faster than on-premise — often 2-4 months for a mid-sized distributor versus 6-18 months for on-premise. The exact timeline depends on scope, data migration complexity, integrations, and organizational readiness. Cloud eliminates hardware procurement and infrastructure setup time.
Modern cloud ERP systems are designed to work efficiently over standard business internet connections. For most distributors, a reliable 25-50 Mbps connection is sufficient. However, if you have unreliable internet or locations with poor connectivity, discuss offline capabilities and failover options with your vendor.
Yes. Ximple ERP is available as both cloud (SaaS) and on-premise deployment. The same modern platform, features, and user experience are available in both models. This gives you flexibility to start with one approach and migrate later, or run hybrid configurations across locations.
Many cloud ERP providers offer data residency options — allowing you to specify the geographic region where your data is stored. For industries with specific compliance requirements (HIPAA, SOX, etc.), verify that your cloud vendor has the necessary certifications and compliance controls. On-premise provides maximum control for highly regulated environments.
Our team can help you evaluate your options based on your specific business requirements, IT resources, and growth plans. Get a personalized recommendation — no pressure, no obligation.
Guides and tools to help you evaluate and plan your ERP deployment.
eBook
A comprehensive guide to selecting, evaluating, and implementing ERP for distribution businesses.
Tool
Estimate your 5-year TCO for cloud vs. on-premise deployment based on your specific situation.
Template
A ready-to-use RFP template with questions specific to wholesale distribution requirements.
Tell us about your business, and we’ll help you determine the best ERP deployment model for your needs.
Cloud ERP for wholesale distributors. Modern UX, reliable operations, and scalable performance.
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