Web-based ERP software or software as a service (SaaS) have been growing in popularity over the last ten years and have clearly passed the early adopter category. They are now a serious alternative to on-premise ERP software solutions that have dominated and continue the lead the ERP marketplace worldwide. The number of companies using ERP applications or ERP modules that are web-based have been growing rapidly each year and now more than 50 percent of companies in North America are using one or more web based solutions or ERP modules that are software on demand application. The popularity has also demand has accelerated the development of new enterprise tools and innovation and Cloud based companies capitalizing on the affordability, ease and potential that hosted enterprise solutions can deliver. ERP modules catering to sub sector of full enterprise systems are flooding the marketplace such as work collaboration applications as companies across the globe scramble in this stressed business environment to find technologies to cut costs and maintain profitability.

The attractive benefits of web-based ERP software and Saas based applications are low capital outlays to get going and in many cases a much easier and faster uptime process. It also generally requires far less IT resources to take in a web based enterprise system or ERP module such as a CRM, customer relationship management application. These drivers a big wins for businesses and the investment in these systems are well worth their rewards. The global user base for cloud applications in general have catapulted to new heights particularly with small and medium sized businesses (SMB). For many SMBs the affordable web based applications with their on demand pricing structures have enabled them to compete effectively with larger competitors.

Particularly during the sluggish economy the number one driver for growth above total cost of product and ease of use has been the attractive pay as you go pricing model. Analysts agree that the growth rate of SaaS applications and web based ERP solutions over the past couple of years has been attributed to the affordability of the pay for service. As companies become more familiar with online applications, the pricing model will only be one of the key drivers for growth in number of hosted ERP users, products and vendors that will be forthcoming. The popularity of these enterprise applications and online solutions forcing traditional on premise ERP giants to relook at the way they are doing business and develop web based applications or ERP modules on their own to compete with the wave of new entrants in the market and maintain market share. Over the ten years it is projected that one third of business applications, not only ERP applications will be a web based or cloud application.

Although there are many powerful SaaS applications available on the market today, there are only a few full ERP software solutions available and those that are have a fledgling user base. SaaS based solutions are mostly catering ERP modules or subsets of a full ERP system such as customer service management of CRM or sales automation. Businesses looking for a single enterprise-wide solution today will most likely go with an on-premise solution but that is by no means indicative of will be the favored choice even 3 years down the road.