It depends on the Client's demands. In most cases, it is a good idea to run an ERP system in a high-availability server environment in order to being available all the time.
In addition, it is worth considering whether the system can only be accessed locally, from an internal network, or from anywhere (via Internet). A hybrid version of these is not excluded either, when some parts of the ERP system can be accessed by anyone on the Internet (eg the webshop for customers), while some parts can only be accessed from the Client's internal network.
If the system is only accessible from an internal network, it is worth running the server locally, at one of the premises of the company.
If it needs to be available to anyone, you may want to rent a VPS or server unit space in a server room with dedicated internet bandwidth.