ERP Solutions

Upfront Costs Versus Total Costs

If you’re thinking about implementing an Enterprise Resource Planning (ERP) solution, the cost may play a big part in your decision.  Larger organizations with more money to burn may not need to count their beans so tightly.  However, if you’re a smaller shop, counting beans may be a necessity to your survival in this turbulent economy.  Before you jet out and buy your brand spanking new ERP solution, consider not only the upfront costs but all the other costs that come along with implementing and running an ERP solution.

There is literally no rhyme or reason to ERP pricing because it is all over the map, so to speak.  While you go about checking out all the different ERP vendors, you’ll find that ERP pricing can be from thousands of dollars to hundreds of thousands of dollars to millions of dollars.  When out there shopping the ERP market and doing your ERP pricing tasks, think about your specific business needs.  Large fortune 500 organizations are probably going to need an ERP solution that’ll cost them millions of dollars.  This is because they may need lots of functionality, detailed customizations, implementation support, data integration and migration support, and training services.  When ERP pricing, you may find that mid-size organizations spend somewhere in the hundreds of thousands of dollars range for their ERP solution.  This is because mid-size organizations may need an ERP solution with less robust functionality, less customizations, and less implementation support.  Then, there’s the smaller organizations who will probably need much less than the large or mid-size organizations.  When ERP pricing ERP solutions for small organizations, you may find that ERP vendors offer solutions with less functionality.  Smaller ERP solutions may offer little to no customizations and easy implementation procedures or steps.

Besides doing your ERP pricing tasks, you need to consider the total costs and not just the upfront cost of the ERP solution.  For example, larger ERP solutions take longer to implement requiring more time and resources.  A large ERP implementation could take years.  Small implementations only take ten months on average to implement.  However, for smaller shops this may be a very pricy endeavor.  Think about future upgrade costs.  We sometimes forget just how pricey upgrades can be.  Consider hardware costs because you will most likely need new or more hardware to support your new ERP solution.  Lastly, you may want support services.  Heck, we all want support services.

Written by :

kristine H