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Prerequisites include installing Visual Studio with .NET Framework and ASP.NET MVC, along with SQL Server and SQL Server Management Studio (SSMS).
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Step 1: Extract the source code files and locate the database file (CloudERPv1) or use the provided script if attachment fails.
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Step 2: Open SQL Server Management Studio as administrator, right-click databases, select 'Attach', browse to the database file path, and attach it.
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Step 3: Configure the database owner in the database properties under the files section by browsing and selecting the appropriate user.
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Step 4: Open the CloudERP.sln solution file inside Visual Studio.
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Step 5: Update the connection strings in the web.config file to match your local SQL Server instance name (e.g., local/SQLEXPRESS).
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Step 6: Run the application and log in using credentials found within the database users folder.