ERP Pricing Investigation - PowerPoint Presentation

Slide1

ERP Pricing Investigation

Doug

Hunter

July 2014Slide2

Software Licensing – Typical OptionsTypes of User LicenseConcurrent or names/Log-onBasic to limited access to modules/functionalityFor Sales & Internal v ExternalDevice usersPlatformDeveloperPackage/Module License – most ERP have 30 to 35 modulesFixed price per module

Variable price driven by business “metric” to match scale

Server based pricing – all modules on a server or blade of a server

Technology LicenseIntegration to external systemsSystem adminOperating system

2014, Doug Hunter. All rights reserved.Slide3

SAGESAGE 300 (Accpac) – typically 5 to 10 users – max 100One User License only One Package cost for ModulesSAGE X3 – typically 10 to 100 users – a few in Africa with 1000There are several user licenses - concurrent - Full user + Operational userBase Modules as a starter ERP – one price is charged for this

N

o

Volume License – users license quantities effectively vary the volumePOS for retail can be users of number of tillsISV solutions also have user and module pricesCloud is an option but seldom taken up in Africa – more focus in USThey aim to be cheaper “by a long way”, simpler and faster than SAPAim to be the vendor of choice for large company subsidiaries in AfricaSlide4

Microsoft DynamicsMS License OptionsServer License – one is required per Server – or even per Server BladeUser Licenses - a range of Client Access Licenses (CALs) per named/log-on user who can then use any device on that serverDevice CAL – one per device where any users can use it (concurrent)Level of User License – each one adds more functionality to the lower one. Self-serve CAL –for one person to perform self service actions (expenses, payroll .)

Task CAL – similar to Self-serve but includes approvals as well

Functional – per person allowing access to business processes (multiple modules)

Enterprise – allows full access to all ERP functions and approvals User License Mix – can bundle license different CALs – MS push EnterpriseSecurity Roles (Bundles) – this refers to purchasing licenses by job function and gives the appropriate access a bundle of modules (EG.

M/C operator v accountant).

Additional Modules (Warehousing, eCommerce, Public Sector) are licensed and paid for via Activation KeysExternal Users – require appropriate CAL – can be periodically reassigned

External

Application licenses

– such as mobile APPs and approvals

etc

– are covered without additional cost by a

CALSlide5

Microsoft DynamicsOther MS License OptionsVolume License - is available through the Enterprise Agreement (EA) for more than 250 users. This includes options like on-premise or cloud delivery plus basic and optional support servicesBusiness Value License (BVL) – similar to Microsoft EA but purchased directly from a VAR who may offer a different range of services and support than Microsoft.Service Provide License Agreement (SPLA) – this applies to partenrs offering hosted services. Licenses are charged as subscription licenses (SALs) instead of CALs and thers is no server license. The partner can add additional services like and EA and the subscription and license agreements only appy for the period of subscription.Slide6

MicrosoftSlide7

EpicorEpicor License OptionsConcurrent User Based Licenses  Named User Based License - named/log-on userEpicor has multiple licensing types Depend on the application or technology used. Some of the most frequently used:

Data Collection Users

- These licenses (otherwise known as MES licenses) allow shop floor or handheld devices to connect to the

Epicor application with a limited user interface.  They are concurrent user licenses.Office Users - have access to the modules that you have purchased through Epicor.  These are concurrent licensesEpicor Mobile Access Users – While Office User licenses can be used to access the Epicor ERP web-client from a workstation, Epicor requires an EMA license to login from a mobile device such as an

iPad.  These are concurrent licenses. 

Time and Expense Management Users - These licenses are separate from Office User licenses that allow employees to record time sheet entries and approvals, and manage expenses.  These are concurrent licenses.Slide8

SAPSAP Business OneStarter Pack (for 5 users) preconfigured with limited functions over the full B1 – go live in 1 to 3 days.Licensing in User basedB1 is offered in Country Versions and is offered On-Demand – but this is actually locally hosted not public cloudFor additional cost Business One comes in a HANA powered version and with Analytics on HANAManufacturing is an additionally purchasable option (3rd Party solution)Slide9

SAPSAP All-in-One, ERP and Business SuiteFast Start License - an initial license for Base ERP – including 5 Users Rapid Deployment Solutions (RDS) - There are a range of Rapid Deployment Solutions for different industries and industryUser Licenses – there are many options and costs grouped into three categories and these are always named users (not concurrent).Professional – users fulfilling operational-related roles supported by the software.Employee – users accessing self-services such as time, expenses, bookingDeveloper - users accessing the development tools to make add-ons (customisation)

Package or “Engine” Licenses

Enterprise Foundation” package – this comes at a fixed cost plus for 15 users

to ERPEnterprise Extension” packages – a combination of User and Package licenses Industry portfolio packages – these are prices according to industry “metrics” Line-of-business portfolio packages- these are prices according to industry “metrics” Database Licensing – for SQL, DB2, Oracle etc and HANA !!Analytics Licenses – in addition

+ a combination of User + Package

licensesMobile licensesMobile Platform – to use the SAP Mobile Platform for development of own mobile apps, there is a package licenseFull use or Run-time – to have unlimited access to SAP and third party mobile applications or limit to a number of mobile users per application Slide10

Pricing StrategiesValue pricing - User price plus price per module are fixed – discount after a purchase valueIndustry Bundles – to cover an industry, or business process range, a group of useful modules - standard ERP + special industry modules (EG, WM, TM, APS, Utility billing, etc)Special launch pricing – marketing to get new solutions traction in the market – offer a low price for a sales that combines ERP and the new solution (EG. Espresso) for the price of ERP alone for a limited introductory period – to new customers onlyUpgrade based pricing – upgrade now to Syspro 7 and you get Workflow free – for a limited promo period or to a target customer group

Contract

pricing for a group globally

– gives a volume/value discount to small subsidiaries which they would not normally get and keeps them in the familyTime based – offer unlimited access/use of certain functionality for a limited period of time – if not live by the end of the period then customer has to repurchase. This can backfire as not everything is implemented on time due to customer capacity to execute.Deal filling – do not discount the price any further but rather add other non-requested modules/users/access to add value to the purchase but not price. This can work with inexperienced IT buyers but still backfire – if the customer does not see value in the “free” additions, this may make the deal but leaves a sour taste of being conned.

Free purchase with maintenance

– Here the vendor declares the price for the software but charges the customer nil for buying it. They do however charge software maintenance in full per year for the declared price. Frequent Oracle strategy in Africa.Slide11

THANK YOU!Doug Hunter