Introduction
Used by tens of thousands of small and midsize businesses all over the world, the SAP Business One application offers an affordable way to manage an entire business – from sales and customer relationships to financials and operations – from one, single location. Sold exclusively through SAP partners, it helps companies streamline processes, act on timely information, and drive profitable growth. Since every business is different, SAP Business One is designed with flexibility in mind and can be deployed either on-premise or in the cloud, and can be accessed from any time and place using the mobile app.
Budget and ROI
To be able to budget for an ERP, it is important to identify what is expected from the ERP towards business operations and growth. This helps in differentiating the essential from the non-essential features. At the same time, it is crucial to make allowance for future costs and increasing organizational resilience to ensure long-term results.
A few points to consider:
- Were labour cost reductions achieved through reallocation of surplus resources, or has it reduced the role of employees leading to ample free time?
- Have there been any tangible improvements since the start of the implementation?
- Has the supply chain been streamlined with better quality, reduced prices, and enhanced inventory management?
Factors that influence the Cost of Implementing an ERP
Here are some factors that companies need to consider while figuring out the ERP that is the best fit for them:
1. Functional requirements
It is important to identify the software that offers a holistic solution for your specific business needs. If there is a system already in place for tracking resources, finances, inventory, or any other aspects of business, an additional cost will be incurred in transferring information to the new ERP.
SAP Business One is capable of integrating various ERP systems offering an agile framework for your business. Click here to find out if it is right for you.
2. On-Premise or On-Cloud Options
One of the most important decisions to make during the installation of SAP Business One is to determine whether to keep everything in-house (On-Premise) or to access it on-demand (Cloud).
As per your business targets and requirements, if you choose an on-premise solution, you can install the ERP locally on the servers using the hardware of your company. This means that you would require a dedicated IT staff to manage the solution without relying on a 3rd-party data centre.
Whereas, for a cloud implementation, the ERP application of your company and all associated data will be centrally managed by the solution vendor, who would provide you the access to it for a monthly subscription cost.
3. SAP License Types & Number of users:-
SAP Business One (SAP B1) offers several different user type licenses that can be broken down into two broad categories – “SAP B1 Professional” and “SAP B1 Limited”.
SAP B1 Professional enables complete access for all the modules in SAP Business One, whereas SAP B1 Limited provides the user with daily access to specific modules as per their job function and requirements.
In addition, the estimated number of users is going to be the most significant factor when estimating your budget. This will help to identify the optimal license type.
4. Add-ons
Add-ons prove to be useful in customizing the package without upgrading to a higher pricing model. Based on the business requirement, an organization can incorporate customized add-ons for various functions including Production, Quality, Export, Sales, CRM, etc.
Click here to learn more about SAP Business One Add-Ons.
5. Customization of functionalities
Customizations are an absolute necessity for any non-standard SAP Business One functionalities and reporting. While there is no ceiling to the customization costs, it can be budget-friendly if planned properly and utilized to generate long-term revenue source for an organization
6. Costing Model
All ERPs have a one-time purchase cost and a recurring subscription cost. The latter is payable monthly. While there are multiple payment options to choose from, annual subscriptions are a good way to save costs as they usually come at a discount.
SAP Business One has flexible licensing models including both One-time Licenses and Licenses as a subscription, along with the optional AMC (Annual Maintenance Contract) costs.
7. Annual Maintenance Costs
Annual Maintenance is necessary for smooth functioning. This is usually charged as a percentage of the software cost and varies from 15%-22% based on the company.
8. Post-implementation Support
It is crucial to have support on hand post-implementation to walk employees through protocols. Having on-call support also makes the transition smoother, ensuring a comprehensive understanding of how to use the software.
The length and type of support can be chosen based on the knowledge level of employees and the business requirement.
What makes SAP Business One so Cost-Effective?
A significant consideration for all SMEs looking to implement an ERP is the budget. SAP Business One comes in handy here as it provides a range of solutions – both customized and standardized at an unbelievably low price right without requiring complex installations.
Features such as statement generation and closed-loop reporting ensure that the Financial Controller has the necessary information at all times. End-to-end visibility and improved accounting help boost sales and allow access to clear, real-time reports with actionable insights. This streamlines the supply chain and enables businesses to take advantage of economies of scale where possible.
Additionally, SAP Business One is incredibly versatile, capable of growing and scaling your enterprise. With the ability to regulate complex functionalities as needed, SAP Business One is a solution with the long-term vision your enterprise aspires to build.
There are several options for purchasing SAP Business One based on the license. These packages can be upgraded at any point. As an SME, you could begin the journey with the starter pack designed for startups and small businesses and includes accounting, sales orders, item management, and purchasing. You could eventually upgrade should the necessity arise.
About Akshay Software Technologies Limited
Founded in 1987 and based in Mumbai, India, Akshay Software Technologies Limited is one of the leading SAP Business One Silver Partners that provides SAP Business One ERP Consulting, Implementation, Support, and License resale. With the experience and the expertise to successfully power the digital transformations of SMEs across various industries, Akshay Software is committed to helping businesses leverage the opportunities of the future.