The pricing policy when purchasing an ERP system is a very opaque matter. The word "purchase" alone is wrong at this point, as it is more of a buying process. In order to avoid over- and underestimations, we will illustrate here what the Compile costs for an ERP system such as SAP Business One. However, the various factors that ultimately influence the price of an ERP solution are so variable that it is impossible to determine a single "true" price.
In general, a distinction is made between internal and external cost factors that are incurred by the company when purchasing an ERP system.
Internal cost factors when purchasing an ERP system
This refers to the costs that are incurred during an ERP implementation in the company itself. These costs are often forgotten and are also difficult to calculate. On the one hand, the entire ERP project some of the employees must take on project management alongside (or instead of) their day-to-day work. On the other hand, the future Users trained in the system become. This naturally reduces productivity in the company itself. These are costs that are difficult to predict and are not included in the ERP providers' prices.
External cost factors when purchasing an ERP system
The external factors relate to the ERP providers. Important cost items here are, for example, the possible purchase of hardware, user licences, data migration and system customisation. It often happens that maintenance and support are not yet included in this price calculation by the provider. However, these are particularly important as they allow the follow-up costs of the ERP project to be estimated for the coming years. Here is an overview of the three main external costs:
1. user number
The costs for a user are incurred per user of the software. The price per user varies depending on the ERP system. The size and popularity of the system often influence the price. For example, the user price for a small industry solution can be much lower than a licence from a software giant. Licence costs are also influenced by the number of modules used by the company.
2. module scope
Many business processes can be mapped using the software's simple standard modules. However, other modules are required for some more complex work steps, which incur additional costs. For smaller companies, a functional scope of around 30 applications is usually sufficient; for larger companies, it is often several hundred.
3. adjustments
It is almost always necessary to adapt the chosen ERP system to the company's structures. Although there are many specific Add-onsbut they still often need to be individualised. This need for customisation often only becomes clear during the implementation process. The costs are therefore difficult to estimate.
As a result, it is sometimes advisable to leave processes that are not optimised anyway behind and simply adapt to the system. Providers often have good, tried-and-tested suggestions for many work steps. Of course, this also means getting used to the system at the beginning and the corresponding time expenditure. But new processes Nevertheless, they usually result in the efficient working that the company hopes for from the introduction of an ERP system. In the end, this is also more favourable in terms of costs than the - often price-intensive - adaptations.
These three main cost factors result in the following recommended steps for companies:
- Calculate the number of users through a precise analysis.
- Project planning, including specifications, limits the scope of functions in the ERP system to the most important.
- State the company's target cost framework from the outset. This allows the possibilities to be calculated right at the start and cost-related outliers to be recognised and weighed up.
Three tips on how you can better estimate internal costs:
1. include references in your selection
The experience of other companies in the same or similar sectors can be very useful for you when purchasing an ERP system. On the one hand, you can get some initial ideas for selecting a provider and, on the other, you can estimate how long an ERP project can take. These companies may also have tips on how to put together a project team or how long the familiarisation phase for users will take.
2. seek advice from the provider
If you have already shortlisted an ERP provider, ask what their views are on implementation and employee training. You can also obtain the opinions of their references here.
3. involve your employees
Through the Selection procedure and ERP implementation, by the time the ERP system is introduced to the users, you will already be familiar with its processes. Therefore, do not underestimate the time it takes to familiarise yourself with the system. It is best to involve employees from different departments during the project.
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