When I first wrote about Tailor as the only headless ERP platform, I focused on the technical capabilities that set it apart from traditional, monolithic ERPs like SAP or NetSuite: an API-first approach that empowers every company with flexibility and data best practices.

But over the past couple of years, as we’ve worked with business owners and operators to rethink what a modern ERP should be, one thing has become clear: many businesses and leadership teams still don’t grasp how wide the gap is between most mission-critical technology and most ERP tools.

Monolithic ERP: The business cost of inflexibility

ERP software has been around for decades, and it takes up a significant portion of most companies’ software budgets — I’ve seen the ERP budget line item represent 30% of all software expenses in some cases. Yet despite the significant investment it represents, ERP hasn’t evolved at the pace of other business technologies. While the best tech companies have embraced API-first, composable architectures, ERP has remained rigid and inflexible.

Businesses that still rely on monolithic (I’ll explain this term later) ERPs are struggling. Implementing an ERP system or upgrade is a massive, expensive, and often disruptive undertaking.

• Ulta Beauty launched a $180 million ERP implementation in 2021 that wrapped up in the summer of 2024. After migrating stores to the new system, Ulta employees faced significant challenges in purchasing, store allocation, and other operational areas. Ulta employees were managing both the old and new systems at the same time, which led to store inventory allocation disruptions that ultimately contributed to a decline in sales in Q2 of 2024.
• Hershey saw an almost 25% sales decline in one product segment after their multiyear SAP ERP implementation stretched into 2024. (Hershey also requested an accelerated ERP implementation with SAP in 1999 that led to a failure to deliver $100 million worth of product because orders weren’t compatible with the new ERP system).
• After switching to SAP, Lamb Weston struggled with reduced visibility and fulfillment challenges hurt net sales by $135 million in 2024.
• Gartner predicts that 70% of enterprise ERP initiatives will fail to meet their original business goals by 2027.

So why do companies keep going down this path? Because monolithic ERP systems demand an all-or-nothing approach, forcing businesses to replace everything at once instead of adapting incrementally. This is exactly why a composable approach is the future.

A Composable approach to business operations

Companies like Uber, Amazon and Shopify have leaned into composable strategies, giving them the agility to scale and innovate — they’ve been able to adapt to new market environments without slowing or halting operations.

For those who are less technically minded or unfamiliar with these engineering terms, the difference between these two kinds of technologies can be difficult to fully grasp — as can their resulting business and operational implications.

The easiest way to define composable software is to explain what it is not. Composable software is the opposite of monolithic software.

What is a monolithic ERP?

Traditional ERP systems like SAP and NetSuite are monolithic and tightly coupled, meaning all business functions — accounting, inventory, sales, HR — are bundled together in a single system. This setup works if you never need to change anything. But the moment you want to customize, integrate new tools or rapidly expand operation, monolithic ERP becomes a nightmare.

The pitfalls of monolithic ERP systems:

• All-or-nothing architecture: You’re forced to use the entire system, even if only parts are relevant to your business. Need a more powerful inventory solution but want to keep your order management as-is? Too bad — you’ll likely need to pay for an entire suite of features when it comes to enterprise ERP tools.
• Difficult customization: Changing one function often requires modifying the entire system because monolithic software is tightly coupled. It’s like unraveling the yarn of a whole sweater just to add a new button.
• Integration headaches: External tools (like Shopify, QuickBooks, or CRM platforms) are hard to connect, forcing companies into manual workarounds like downloading data via spreadsheets and uploading into other tools.

Definition: Monolithic ERP

A monolithic ERP is a traditional, all-in-one software tool where all business functions (such as accounting, inventory, sales and HR) are tightly integrated into a single platform. Examples include SAP and NetSuite. While this approach can provide a unified system, it comes with significant downsides, such as all-or-nothing adoption of an entire suite of tools and limited integration with external tools (such as Shopify or QuickBooks).

What is composable software?

A composable software platform solves this problem by decoupling different functions into modular, API-first components. What does this mean? Imagine that instead of buying one giant ERP app that manages everything (manufacturing, inventory, purchasing, supply chain, different sales channels), you bought individual apps — or modules — for your different business functions and needs. But here’s the key difference, these modules all talk perfectly to each other and you can manage all of them from the same interface/screen.

Instead of being locked into an all-in-one system, businesses can pick and choose the tools that best suit their needs. Operators can tailor their software according to their specific use cases or problems they need to solve — rather than changing their operations to accommodate an ERP system’s workflows.

Our team often points to Shopify as an example of this kind of flexible, API-first capability. Many commerce tools promise customization via access to an API — but ultimately fall short by providing APIs as an afterthought and failing to fully integrate them with their own product development (rendering API access almost useless for their customers). While traditional commerce systems sold a tightly coupled frontend and backend, Shopify became the de facto headless commerce platform by providing a new level of operational flexibility with a composable and API-first architecture.

Shopify’s composable approach:

• Cart & Checkout: Want to build a native store experience in your mobile app? Shopify’s composable approach allows businesses to use its cart and checkout via Shopify’s API. This eliminates the need to create or manage another database for mobile app carts and purchases, freeing up businesses and developers to focus on excellent front-end experiences.
• Customer Support: Shopify’s API enables third-party customer support tools to dynamically access order and customer data. Companies can choose the support tools that suit them best while accessing relevant customer information in real time via API.
• Shipping & Logistics: Instead of building proprietary shipping solutions, businesses can integrate Shopify’s API with carriers like FedEx and enable flexible shipping, tracking, and returns management without developing custom infrastructure.
• Returns & Order Management: Businesses can integrate specialized solutions for return management instead of relying on built-in platform tools. API-driven connectivity across the modern commerce stack ensures that return data syncs with customer orders and warehouse systems.
• Ecosystem & Extensibility: Because modern commerce tech stacks are composable, businesses can pick and choose their solutions rather than being locked into a single platform’s native tools. Unlike older monolithic platforms, Shopify’s API-first model allows businesses to choose from an entire ecosystem of apps and integrations with third-party software.
• Composable Frontend & CMS: Businesses are no longer restricted to built-in templates — they can create unique storefronts while leveraging Shopify’s backend capabilities. Headless CMS platforms can be integrated seamlessly, allowing for richer, content-driven commerce experiences.

Many first-time ERP buyers we’ve encountered expect the same flexibility they get from Shopify, only to face a harsh reality. I often hear: “What do you mean I can’t change just one thing? Why can’t we use Shopify to take orders and use SAP's accounting.”

Definition: Composable ERP

Composable ERP is a modular, API-first software platform that allows businesses to use and customize only the functionalities they need (such as inventory, finance, order management or CRM). Unlike traditional monolithic ERPs, composable ERP systems are built from independent — yet seamlessly connected and compatible — components. Composable ERP enables flexibility and integration with tools like Shopify and QuickBooks via API-driven architecture while also providing scalability and resilience against disruptions.

What’s the difference between composable ERP and app integrations?

You might wonder, “How is this different from my other apps (for accounting, inventory management, ordering processing, etc.) that integrate with my other primary systems like Shopify and QuickBooks?”

The key difference: Composable software isn’t just about integrating apps — it’s about designing your entire system to be modular, flexible, reliable and scalable from the ground up.

App Integrations = Adding on to an existing structure	Composable Software = An efficient system That Works for You
When you connect Shopify, QuickBooks, or an inventory tool, you’re stacking integrations on top of separate systems. This works in the short term, but over time: Data syncing becomes messy. Workflows hit automation limitations. If one system changes (like a Shopify API update), integrations break.	Instead of patching together multiple apps, a composable ERP is built from independent, interchangeable modules that naturally connect. Choose only the modules you need (inventory, finance, order management, etc.). Maintain a central source of truth, rather than fragmented data across multiple apps. Automate processes seamlessly without syncing issues

Think of traditional integrations like using power adapters to connect different devices — you can make it work, but you run the risk of everything going down or overloading the system. Composable software is like Legos — designed to fit together perfectly from the start so you can tear apart and rebuild wherever you need to without starting from scratch.

Monolithic ERP vs. Headless ERP

A helpful metaphor for how monolithic ERP systems differ from composable or headless ERPs is a food court vs. a standalone restaurant.

Monolithic ERP is like a traditional, standalone restaurant, where the kitchen prepares every dish from a single menu. If you want to upgrade your equipment, add new dishes or change how one part of the menu is prepared, you need to overhaul the entire kitchen. This slows down the entire operation with disruptions.

Composable software, like a headless ERP, is more like a food court:

• Modules = different food court vendors. Each food vendor specializes in a specific cuisine or dish like sushi, burgers, pizza.
• APIs = shared infrastructure. These vendors operate independently but share common infrastructure like seating, utilities, restrooms, and payment systems.

With a food court:

• You can add or remove vendors (modules) without affecting the others.
• If one vendor is too busy or fails, the rest of the food court keeps running.
• Customers (users) can mix and match meals (customize workflows between modules) based on their preferences.

Composable software like headless ERP isn’t about forcing businesses into a single system. It’s about enabling them to build the system that works best for them at any given stage of growth. Instead of being forced into an all-in-one system, businesses can mix and match the best tools for each function.

• Flexibility: Choose the modules you need (inventory, accounting, CRM, etc.), swap them out when necessary, and integrate with best-of-breed tools.
• Easy Integration: API-driven architecture ensures smooth connections with external platforms like Shopify, QuickBooks or any specialized software.
• Scalability: Businesses can start with only the essentials and expand their system as they grow, without massive overhauls or risks of a large-scale implementation.

Growing brands: Where lack of flexibility & reliability is painful

For growing businesses, the need for a composable approach is often urgent. Without it, companies end up:

• Adopting temporary fixes that don’t scale.
• Getting locked into inflexible monolithic ERPs that require costly migrations later.
• Bouncing between ERP-adjacent solutions that lack an accessible source of truth.

Retailers or companies selling via multiple channels (omnichannel) in particular have voiced the unique pains of balancing growth and their operational systems:

• Our systems fail at critical times: Our patchwork solution of apps that integrate with Shopify, Quickbooks, our Airtable database, inventory management tools and other apps lead to slow load times and lag during peak order volume (Black Friday, promotional periods, etc.)
• I can’t figure out our product margin: Our inflexible inventory accounting doesn’t support freight, landed costs or past due invoices, so we never have clear and nuanced picture of our inventory costs.
• I’m constantly overstocked or out of stock: We want to account for seasonality with our forecasting or wrangle our unpredictable B2B orders with smarter replenishment dates. But our sales order process can’t map to our ERP’s product structure.
• We’re constantly canceling orders or over-selling: Our inventory management tool integrates with our online store and other marketplaces in theory. But the data takes too long to sync so we end up selling inventory that doesn’t exist.

A final note

Some of our favorite customers are those who have been burned by a bad ERP implementation. They’ve experienced the growing pains that led to exploring legacy ERPs and know firsthand that a more flexible, scalable system isn’t just nice to have. It’s necessary to stay afloat in an increasingly complex retail landscape.

That’s why we built Tailor as the only headless, API-first ERP. With Tailor, companies can:

• Start small, solving critical operational problems first. You can launch a Tailor module within the first week of your implementation.
• Add or swap out modules without disrupting the entire system.
• Avoid downtime by gradually integrating new tools alongside existing processes.

Curious about how Tailor’s headless ERP helps you take control of retail operations in weeks (instead of months)? Book a demo with our team.

Quick Answers and Frequently Asked Questions (FAQ)

What’s the difference between composable and headless?

Composable and headless are closely related concepts. Headless refers to decoupling a system’s frontend (user interface) from its backend (core functions and data). For example, a business could use a headless content management system to deploy custom experiences across its mobile app and website without being constrained by templates, plugin functionality, etc. Composable, on the other hand, goes beyond decoupling the frontend by breaking down the entire system into modular, API-first components that can be inserted, adjusted and replaced as needed.

How can I evaluate if an ERP solution is composable?

There are several definitions of what makes software truly composable. Gartner’s four, core principles for composability (orchestration, discovery, modularity, autonomy) provide a helpful framework but are a bit abstract. That’s why we recommend evaluating headless ERP vendors based on one main criterion: whether they have an API-first approach. Look for public API documents and good developer support — you should have access to the vendor’s developers or a sales engineer with working programming knowledge. If a vendor charges an additional fee for using APIs, that’s a red flag.