Most retailers don’t realize they’re losing 3-7% of annual revenue to operational inefficiencies until it’s too late.
Your QuickBooks setup might handle basic accounting, but it can’t tell you that Product X is selling faster online than in-store, or that your return rates spike during specific promotional periods.
Here’s what’s costing you money: manually updating inventory across channels (leading to overselling), delayed financial reporting that misses cash flow issues, and customer service teams who can’t access purchase history during returns.
Business Central in retail eliminates these revenue leaks by providing real-time inventory synchronization, automated financial consolidation, and unified customer data.
Let’s take a closer look at Business Central (BC) as a unified retail ERP. Read on to learn more!
- Centralized management of e-commerce, POS, finance, supply chain, and inventory.
- Real-time stock visibility, SKU-level tracking, and automated replenishment.
- AI-driven demand forecasting and streamlined vendor workflows for seasonal planning.
- Consistent promotions & pricing rules across online and in-store channels.
- Unified customer data enabling loyalty programs, returns, and personalized engagement.
- Native integration with Teams, Excel, and Power BI for reporting and approvals.
- Omnichannel extensions including Shopify, LS Retail, and Avalara connectors.
- AI & Copilot features for forecasting accuracy, anomaly detection, and campaigns.
- Scalable Azure infrastructure supporting peak retail traffic and compliance.
- Faster deployment, reduced IT costs, and measurable improvements in accuracy & ROI.
Business Central in Retail as a Unified ERP
Microsoft Dynamics 365 Business Central is a cloud-native ERP solution that helps small and mid-sized retailers manage every part of their operations.
The platform connects e-commerce, POS, inventory, supply chain, and finance within one system. This integration supports faster decisions and reduces errors caused by disconnected tools.
Retail Challenges Solved With Business Central
Retailers deal with shifting demand, high competition, and increasing service expectations. Business Central in retail addresses these challenges.
Real-Time Inventory Management
Disjointed systems often cause overselling, inaccurate stock counts, and lost sales. Business Central improves inventory and stock management in retail through:
- Centralized stock visibility: Provides accurate availability across e-commerce platforms, stores, and warehouses
- SKU and location tracking: Ensures updates reflect real quantities in each location
- Automated replenishment: Creates purchase orders once stock reaches reorder levels
Managing Demand Fluctuations and Seasonal Spikes
Retail demand often shifts during holidays or events. Worse? Manual planning makes retailers prone to stockouts or excess.
Business Central supports accurate demand forecasting in retail with:
- AI-based forecasting: Predicts demand using historical and current sales data
- Purchase planning worksheets: Aligns procurement with predicted requirements
- Automated vendor workflows: Streamlines procurement and reduces lead times
Handling Complex Pricing and Promotions
Inconsistent promotions across physical and digital channels damage revenue and trust. Business Central resolves this with these features:
- Campaign pricing engine: Manages promotions across every sales channel
- Centralized price lists: Applies uniform pricing rules in POS and e-commerce
- Integrated tax compliance: Maintains accurate pricing for multi-region sales and minimizes risks with built-in tax calculations
This localized approach means our clients can confidently stock for regional and seasonal variations that are critical to retail success.
Delivering Better Customer Experience and Returns
Customers expect smooth service across online and offline channels. Business Central helps you build loyalty with:
- Unified customer profiles: Provide a complete view of shopping history for personalization
- Automated return workflows: Simplify the return process and shorten resolution times
- Personalized engagement: Enable loyalty programs and targeted offers for better retention
Industry Challenges and Business Central Solutions
The table below highlights how Business Central in retail aligns with real-world issues.
| Challenge | Example | Business Central Feature | Outcome |
| Inventory chaos across channels | A fashion brand oversells on Amazon and Shopify because stock counts differ across platforms | Item availability tracking, SKU management, Shopify connector | Accurate stock updates across channels prevent overselling and delayed orders |
| Disjointed customer experience | An electronics retailer cannot personalize offers consistently between the POS and web store | Unified customer profiles, segmentation tools | Personalized campaigns increase repeat purchases and improve loyalty engagement |
| Procurement delays | A manufacturer faces stockouts as purchase orders depend on manual updates | Demand forecasting, purchase planning worksheets, automated PO workflows | Faster procurement cycles with reduced risk of stockouts |
| Complex promotions | A grocery chain struggles to manage regional discounts and seasonal campaigns | Campaign pricing engine, centralized price lists | Consistent pricing across channels improves accuracy and campaign success |
| Manual approvals reduce efficiency | Retail teams spend hours every month on invoice approvals and reconciliations | Workflow automation, cost accounting, Power Automate integration | Approvals become faster, and managers gain visibility into expenses |
| Fragmented tech stack | Multi-store brands use separate systems for POS, e-commerce, and finance | Native integrations with Shopify, LS Retail, Avalara, and AppSource extensions | Unified ecosystem eliminates silos and provides retail supply chain visibility |
Why Choose Business Central for Retail and E-Commerce
Retailers today need to build a custom ERP that supports rapid growth, unifies channels, and adapts to changing customer expectations.
Here’s why Business Central in retail stands out.
Cloud-Native and Scalable on Azure
Business Central is hosted on Microsoft Azure, which provides built-in security, compliance, and elasticity.
Retailers no longer need heavy infrastructure to handle seasonal peaks. For example, an apparel retailer scaling during Black Friday can process a surge in orders without downtime or additional hardware.
This scalability supports long-term retail operations efficiency, as businesses can expand to new stores or regions while relying on the same platform.
Azure also ensures that sensitive customer and financial data remains secure across geographies, which reduces common challenges in retail ERP adoption around compliance and reliability.
Seamless Integration With Microsoft Tools
Retail teams already depend on Microsoft applications for daily work. Business Central integrates directly with these tools, which simplifies workflows and helps teams make faster, better-informed decisions.
To see how this works in practice:
- A finance manager can export sales data into Excel, reconcile accounts, and sync updates back into BC within minutes
- Store managers approve procurement requests through MS Teams, which keeps purchasing aligned with live demand
- Executives monitor real-time financial reporting for retailers using embedded Power BI dashboards that track profitability, cash flow, and inventory turnover
Retail and E-Commerce Extensions
Retailers that operate across channels often face mismatched data and customer experiences. BC addresses this with extensions designed for omnichannel retail management:
- Shopify connector keeps e-commerce orders, inventory, and customer data in sync, eliminating manual reconciliation
- LS Retail connects POS systems to Business Central, helping retailers run promotions and loyalty programs consistently across multiple stores
- Avalara integration simplifies tax compliance across states and countries, making expansion smoother for global retailers
AI and Copilot for Retail Forecasting and Insights
Retailers need accurate forecasts and actionable insights to stay competitive. These AI tools in BC deliver both:
- Demand forecasting in retail uses historical and live sales data to recommend purchase quantities, reducing both stockouts and dead stock
- Anomaly detection highlights unusual patterns, such as sudden stock drops in a store, allowing quick corrective action
- Copilot in BC assists in marketing by drafting follow-up messages for abandoned carts and tailored offers for specific customer segments
Faster ROI and Lower Cost of Ownership
Legacy systems often create barriers to adoption through long implementations and high IT costs. Business Central changes this model.
Retailers can deploy within weeks, start automating workflows, and benefit from built-in reporting much sooner than traditional ERP platforms allow. Since the solution is cloud-native, there are no expenses for servers, upgrades, or manual maintenance. Microsoft also delivers updates regularly, ensuring the system remains current without added overhead. It results in faster ROI, reduced operating costs, and a more predictable path to scale your business.
• Investment payback in under six months, consistent with our retail client experiences
• 12.5% productivity improvements for finance and operations teams
• Three-year ROI that validates choosing the right ERP implementation partner
Key Functionalities of Business Central for Retail
Running retail operations means balancing stock, channels, customers, and finances, all at once. Business Central in retail brings these moving parts together with features designed for everyday efficiency and long-term growth.
Let’s take a closer look at these.
Inventory and Warehouse Management
via Microsoft
BC provides retailers with connected tools that make inventory and stock management in retail both accurate and proactive. These tools include:
- Lot, serial, and expiration tracking: Monitors product traceability and shelf life, which is critical for industries like food, pharma, and electronics.
- Flexible costing and valuation methods: Supports FIFO, LIFO, average, and standard costing so retailers can manage margins accurately and align with accounting practices.
- Cycle counting and reconciliation: Enables periodic checks of selected items or locations and highlights discrepancies between physical and system counts for correction.
Omnichannel E-commerce Integration
Business Central facilitates smooth omnichannel retail management by connecting online platforms and in-store systems into one environment. Here’s how:
- E-commerce integrations: Connects directly with Shopify, Magento, and WooCommerce for smooth order and catalog management
- Unified promotions and payments: Applies discounts, gift cards, and payment methods consistently across every channel
- Consolidated sales and inventory view: Provides a single dashboard for managers to monitor transactions and stock levels
- LS Retail integration: Expands POS functionality for chain stores, restaurants, and specialty retailers
Customer and Loyalty Management
Disconnected customer data prevents retailers from building relationships. BC supports customer loyalty and personalization through:
- Predictive behavior insights: Anticipates churn risks or upsell opportunities by analyzing past purchases and engagement patterns
- Dynamic customer segments: Groups shoppers into categories like high-value buyers or cart-abandoners for precise outreach
- Tiered loyalty programs: Supports point-based or status-based rewards, giving repeat customers incentives that match their activity
Financial and Tax Compliance
Retailers face constant reporting and compliance requirements across geographies. BC addresses this with:
- Multi-currency transactions: Handles payments, purchases, and accounting in multiple currencies while tracking exchange rate differences
- Reporting in alternate currencies: Produces financial statements in both local and reporting currencies without manual conversion
- Customizable financial dashboards: Displays key metrics like margins, cash flow, and profitability tailored by department, location, or project
- Multi-company consolidation: Combines financial data from multiple entities, simplifying intercompany transactions and unified reporting
Supply Chain Optimization
via Microsoft
Seasonal demand and vendor delays disrupt operations if not managed proactively. Business Central enhances retail supply chain visibility with:
- Demand forecasting: Uses sales patterns to guide procurement decisions and anticipate stock needs
- Purchase planning worksheets: Aligns inventory levels with demand forecasts for more accurate ordering
- Vendor lead-time tracking: Monitors supplier timelines to improve reliability and reduce delays
Reporting and Retail Analytics
Static reporting cannot keep pace with retail demands.
via Microsoft Learn
Business Central helps teams manage operations and plan growth strategically with these features:
- Embedded Power BI dashboards: Visualizes KPIs like fulfillment rates, inventory turnover, and gross margin in real time
- Predictive analytics: Identifies trends and forecasts outcomes to guide sales, inventory, and staffing decisions
- Customizable reports: Lets teams tailor views and drill into data by store, product line, or region for actionable insights
A fashion retailer with 40+ stores and a Shopify e-commerce channel struggled with stock mismatches, high return rates, and long reconciliation cycles.
Business Central implementation in retail resolved these challenges through Shopify integration, warehouse automation, centralized customer data, and automated financial postings.
The Impact:
- Order accuracy improved to 98.5%
- Stockouts fell from 14% to 4%
- Reconciliation time dropped by 85%
- Repeat purchase rate rose from 22% to 40%
Work with Aegis Softtech to implement Business Central for retail. Our team helps retailers unify e-commerce, POS, and finance to scale confidently and deliver measurable results.
Best Practices for Business Central Implementation in Retail
You can follow these proven best practices to overcome common challenges in retail ERP adoption faster.
Define KPIs and Track Them in Power BI
You’ll have transaction data flowing through the system, but no quick way to see which products have the highest margins after shipping costs, or how store performance compares across locations.
Define these core retail KPIs during setup:
- Inventory turnover by product and location: See how fast your products are selling at each location, so you know what’s flying off the shelves and what’s sitting too long
- Gross margins, including all fulfillment costs: Keep track of profits after all fulfillment costs, so you can spot which products or stores are making money
- Customer acquisition cost by channel: Know how much it costs to bring in a new customer for each channel to make smarter marketing decisions
- Return rates by product category: Track the percentage of items customers send back by category to catch issues with quality, fit, or expectations early
Business Central’s built-in Power BI integration pulls this data into automated dashboards without manual exports. Then, it automatically creates visual dashboards that update every hour.
Automate Retail Workflows With Power Automate
Manual processes waste time and slow down teams.
Connecting Business Central in retail with Power Automate replaces routine tasks with automated workflows.
For example, purchase order approvals can be routed automatically, low-stock alerts can be triggered for procurement teams, and customer notifications can be sent instantly. These workflows improve responsiveness and support stronger customer loyalty and personalization while enhancing overall retail operations efficiency.
Establish Multi-Channel Pricing Rules Early
Different customer segments expect different pricing: wholesale buyers get volume discounts, loyalty members receive exclusive offers, and online shoppers see dynamic pricing based on inventory levels.
Business Central’s pricing engine handles these scenarios when configured properly from the start:
- Customer price groups: Segment wholesale, retail, and VIP customers with automatic discount application
- Item discount groups: Apply category-specific promotions across seasonal merchandise or slow-moving inventory
- Geographic pricing rules: Adjust prices by region to match local competition without manual intervention
- Channel-specific pricing: Set different prices for online versus in-store to account for shipping costs or convenience factors
- Promotional pricing schedules: Automate flash sales, holiday discounts, and clearance events with start and end dates
Early planning prevents the common trap where retailers discover pricing inconsistencies only after customer complaints damage their brand reputation.
Involve Store Managers in ERP Adoption
Store managers often resist Business Central implementation because they’re excluded from the planning process, then expected to abandon familiar POS systems overnight.
The disconnect leads to continued workarounds like paper logs or personal spreadsheets because the new system doesn’t match their proven daily workflows.
Involve store managers during the blueprint phase to promote smoother adoption. Having them demonstrate current processes for returns, inventory counts, and customer complaints helps configure Business Central to mirror these workflows rather than forcing entirely new approaches on experienced staff.
Pilot programs at select locations build internal advocates. Store managers who successfully adopt the system become your most effective trainers, providing peer-to-peer guidance that carries more weight than corporate mandates during company-wide rollout.
Plan Scalability on Azure Infrastructure
Most retailers underestimate growth and face performance bottlenecks during peak seasons when Business Central struggles with traffic spikes.
Systems that handle 50 concurrent users smoothly can crash during Black Friday when real-time inventory updates become critical.
Planning for scalability means thinking beyond current operational needs:
- Size for peak volumes: Base your Azure environment on Black Friday traffic patterns, not average daily usage
- Configure auto-scaling rules: Set automatic resource additions when CPU usage exceeds defined thresholds
- Partition transaction data: Organize tables by date ranges to prevent year-end processing delays
- Archive historical records: Move older data to separate storage maintaining optimal system performance
Future Trends for the Retail Industry With Business Central
Retail is shifting toward smarter, connected, and more responsive systems. Here’s how Business Central in retail is shaping that future.
AI-Driven Forecasting and Personalization
Forecasting in retail has traditionally relied on static sales history, which often misses rapid shifts in customer demand.
Business Central changes this with AI and Copilot, which use real-time data alongside historical trends to improve demand forecasting in retail. It implies that retailers can plan more confidently for seasonal peaks or sudden spikes in product categories.
At the same time, these AI-driven insights extend into the customer journey. Unified profiles combined with predictive analytics allow retailers to personalize offers, design smarter loyalty campaigns, and deliver recommendations that reflect actual buying patterns.
For example, SPAR ICS reached around 90% prediction accuracy in inventory demand.
Achieving customer loyalty and personalization through modern forecasting leads to more resilient operations and consistent revenue streams.
AR/VR Integration
Virtual try-ons and immersive product visualizations are reducing returns and improving the customer experience. Real estate tools, furniture brands, and fashion labels use augmented reality (AR) so shoppers can preview how a couch might look in their living room or what sunglasses look like on their face using their phone.
When AR is connected with the ERP backend (stock availability, pricing, return policies), you know what’s available, what can be shipped, and what might be returned, all before the sale happens.
That level of visibility helps smooth out operations and reduce surprises in returns or backorders.
Voice Commerce
Voice commands (via devices like Alexa or Google Assistant) are becoming a channel no retailer can ignore. When this connects to your retail ERP, orders placed using voice can trigger inventory checks, stock reservations, and fulfillment workflows automatically.
Combining voice commerce with BC means faster turnaround for simple reorder tasks, easier reordering for loyal customers, and fewer errors. It lets you lean into new buying behavior without fragmenting your backend systems.
Fraud Detection
Transactions that look “normal” sometimes hide odd patterns like fake accounts, unusual order volumes, or returns abuse. Business Central’s AI-driven features and partner integrations monitor real-time data to flag suspicious transactions.
For example, Pets at Home built an AI agent to assist their fraud detection team; they cut down investigation time significantly.
Early detection means fewer chargebacks, lower losses, and a safer environment for honest customers.
Omnichannel Growth and IoT in Retail ERP
Omnichannel has already become a baseline expectation, with customers moving between e-commerce and physical stores seamlessly. BC supports this through integrations with Shopify, LS Retail, and Avalara, creating the foundation for omnichannel retail management.
What’s next is the integration of IoT technology into the ERP for the retail industry.
Sensors in warehouses and retail outlets can feed live data directly into BC, improving inventory and stock management in retail. Managers gain accurate, real-time visibility into stock movements, shelf performance, and supply chain bottlenecks.
The continuous stream of data strengthens retail supply chain visibility and enables quicker decisions, from replenishment to promotions.
Why Partner With Aegis Softtech for Retail ERP Success
Adopting Business Central in retail works best when you have a partner who understands how retail operations run and what challenges matter most.
That’s where we come in.
Our approach is hands-on from the start. We work with you on fit-gap analysis, set up connectors, and manage integrations such as Shopify, LS Retail, and Avalara. Then, we guide your teams through role-based training so managers, finance staff, and store associates can adapt to new workflows quickly.
Additionally, our experience includes retail ERP projects covering e-commerce rollouts, POS integrations, warehouse automation, and loyalty programs.
Beyond deployment, we provide continuous support so your Business Central implementation in retail scales with your business and sustains long-term efficiency.
Our client, Rajiv Doshi, shares: “Working with Aegis Softtech on our Microsoft Dynamics 365 Business Central implementation has been a great experience. Their deep industry knowledge and dedication to delivering results on time gave us confidence in their work.”
FAQs
1. How to use a retail customer template in Business Central?
Retailers can set up customer templates in Business Central to predefine payment terms, discount rules, posting groups, and other details. This standardization speeds up new customer record creation and ensures consistency across POS and e-commerce channels.
2. How does Business Central support seasonal promotions in retail?
Business Central centralizes pricing rules so discounts and campaigns are applied consistently across online and in-store channels.
Using its campaign pricing engine, price lists, and Avalara tax integration, retailers can launch holiday or festival promotions without running into mismatched prices or compliance errors.
3. Can Business Central integrate with third-party e-commerce platforms beyond Shopify?
Yes. Beyond its native Shopify connector, Business Central supports Magento, WooCommerce, Amazon, and Flipkart integrations. Many retailers also extend functionality through LS Retail for POS or AppSource extensions, ensuring omnichannel coverage.
4. Does Business Central provide mobile access for store associates?
Yes. The role-tailored client and mobile app allow associates to check stock, manage returns, and view customer profiles directly from their devices.
5. How does Business Central help retailers reduce returns?
Returns are reduced through accurate order processing and centralized customer visibility.
Automated inventory sync across channels prevents overselling, while unified profiles help associates quickly match orders during in-store returns. In one retail case, incorrect dispatches dropped from 12% to under 2% after Business Central rollout.
