Key Takeaways
- Tally is excellent for accounting and GST, but limited for multi-department operations.
- Odoo offers broad, modular ERP features at SME-friendly cost and can be customised.
- Custom ERP fits unique workflows exactly and avoids per-user licence fees, but needs a strong development partner.
For most Indian SMEs, the ERP decision comes down to three options: stay with Tally (perhaps with add-ons), move to Odoo, or build a custom ERP. Each is the right answer for some businesses. Here is how to decide.
Tally: the accounting backbone
Tally is trusted by accountants across India, handles GST, e-invoicing and statutory reports well, and is quick to learn. Its limits appear when you need workflows across departments: approvals, CRM, production planning, dealer portals, mobile apps for field teams or advanced dashboards.
Odoo: modular, open-source ERP
Odoo covers accounting, inventory, sales, purchase, manufacturing, CRM, HR, website and e-commerce in one platform. The Community edition is free; Enterprise adds features and support with per-user pricing. It has an Indian localisation for GST and can be customised in Python. Many businesses hire specialists to tailor it; see our hire Odoo developer service.
Custom ERP: built around your business
A custom ERP is designed specifically for your processes. You own the code, pay no per-user licences and can integrate deeply with your other systems. The trade-off is higher upfront development cost and dependence on a capable development partner.
Comparison table
| Criteria | Tally | Odoo | Custom ERP |
|---|---|---|---|
| Best for | Accounting, small teams | Multi-department SMEs | Unique or complex workflows |
| GST & e-invoice | Strong | Good (localisation/connectors) | Built to need |
| Modules | Accounting, inventory | 50+ apps | Exactly what you need |
| Customisation | Limited (TDL) | High | Unlimited |
| Licence cost | Low | Free (Community) / per user (Enterprise) | None |
| Upfront cost | Lowest | Medium | Highest |
| Mobile & web access | Limited | Yes | Yes |
| Ownership of code | No | Open source | Yes |
Which should you choose?
- Stay with Tally if you are mainly an accounting-driven business with under 10–15 users and simple inventory.
- Choose Odoo if you need several departments connected quickly, standard processes fit you 70–80%, and you want a proven platform.
- Choose custom ERP if your processes are your competitive advantage, you need deep integrations, or you expect many users and want to avoid licence costs.
Can you combine them?
Yes. Many companies run Odoo or a custom ERP for operations and push accounting entries to Tally for their CA during a transition. Over time, most consolidate into one system to avoid duplication.
Decision checklist
- How many users in 3 years?
- How unique are your core processes?
- Which integrations are must-haves (e-commerce, payment, machines)?
- What is your 3-year budget, not just year one?
- Do you want to own the code?
For a deeper look at the enterprise options, read custom ERP vs SAP/Odoo for SMEs.
Planning a ERP Development project?
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Explore ERP DevelopmentGet a Free QuoteRelated reading: Custom ERP vs SAP/Odoo · GST-Ready ERP Features
Frequently Asked Questions
Is Odoo better than Tally?
Odoo is a broader ERP covering many departments, while Tally is focused on accounting and inventory. For multi-department operations Odoo is usually better; for pure accounting Tally remains very strong.
Is Odoo free in India?
Odoo Community edition is open source and free to use; you pay for implementation and hosting. Odoo Enterprise has per-user subscription fees.
When is custom ERP better than Odoo?
When your workflows are highly specific, you need deep integrations, or you expect a large number of users and want to avoid recurring licence costs.
Can Tally data be migrated to Odoo or custom ERP?
Yes. Masters, opening balances and transactions can be exported from Tally and imported into Odoo or a custom ERP after cleaning and mapping.
