SAP Business One is an ERP system and software designed to help small and medium-sized businesses manage their finances, streamline their operations, and gain better visibility into their business processes. It offers a wide range of features for financial management sales, inventory management, customer relationship management (CRM), sales force automation, human resources management, project management, customer management purchasing, supply chain, purchasing control, and more. As such, SAP Business One is an invaluable resource for businesses looking to improve their operations and remain competitive in the marketplace.
As with any business solution, SAP Business One pricing can vary depending on the specific needs of the business. It is crucial for businesses to have a clear understanding of the different pricing and cost factors involved in implementing and maintaining SAP Business One to make an informed decision. In this article, we will explore the various costs associated with SAP Business One, including license costs, cloud costs, implementation costs, training costs, and other costs, to help businesses evaluate and plan their investment in this powerful new ERP software first.
What is SAP Business One license?
SAP Business One license is a permission granted by SAP to use their enterprise resource planning (ERP) software for small and medium-sized businesses. A license is required to legally operate SAP Business One, and it enables the user to access and use the software's various modules and functionalities.
SAP Business One pricing depends on several factors such as the number of users, the modules required, and the type of license (such as a professional license or limited user license). Additionally, there are different licensing options available, such as perpetual or subscription.
SAP Business One Licensing Model
SAP Business One offers several licensing models that cater to the needs of small and medium-sized businesses. Here are some of the key licensing models for SAP Business One:
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Professional license: This user license offers full functionality to users, including access to all modules and features of SAP Business One. The professional license is typically used by employees who require unlimited access to every one of SAP businesses including sales, financial management, customer management, inventory control, purchasing, and much more.
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Limited license: This user license offers limited functionality to users, restricting access to certain modules or features of SAP Business One. The limited licenses are typically used by employees who only require access to specific modules or features such as customer management, financial management, CRM, inventory control or business intelligence analytics or customer management purchasing or financial management sales.
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Starter package license: This license is designed for small businesses that require basic financial and operational management functions. The starter package license is limited to five users and includes only the most essential modules and features.
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Indirect access license: This license is required for third-party systems that need to access or use SAP Business One data. The indirect access license is typically used by vendors, partners, or other third parties who need to access SAP Business One data.
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Perpetual vs. Subscription Licensing: SAP Business One offers both perpetual and subscription licensing options. Perpetual licensing requires an upfront payment for the license, while subscription licensing requires ongoing payments.
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Named user Licensing: SAP Business One also offers named user licensing, which means that each user who needs access to the software requires a separate license.
What is the pricing for SAP Business One?
SAP Business One pricing can vary depending on the licensing model chosen.
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For the perpetual licensing model, you can purchase the Professional User License, the Limited User License and the Starter Package license types.
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For the cloud-hosted subscription model, the pricing tiers include SAP Cloud Multi-Tenant Professional user, Limited user and the Starter users.
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The SAP Cloud Single-Tenant Professional is priced at the cost of the environment plus usually a markup of 30% to 40% to manage the environment.
Additional costs for implementation, training, and maintenance should also be considered.
SAP Business One Perpetual License Pricing Model
The SAP Business One price for the perpetual model or a one-time SAP Business One price include:
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Professional licenses price: about $3,200 each. The professional user license provides unlimited access to SAP Business One's features and the software development kit.
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Limited licenses price: $1,650 each. The limited user licenses have limited access to a specific professional area of the software.
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Starter licenses price: $1,350 each. The cost-effective starter package is limited to a maximum of five users.
When purchasing SAP Business One, each package includes one license, so if you need multiple licenses, you will need to multiply the SAP software license cost by the number of users. It's important to note that you can upgrade your package at any time.
What is the difference between SAP cloud and SAP on-premise costs?
SAP Business One is an enterprise resource planning (ERP) software designed for small businesses and medium-sized companies. It is available in both on-premise and cloud-based versions. The main cost differences between SAP Business One on cloud and on the local server are as follows:
SAP Cloud vs On-premise Costs
SAP Business One on local servers requires a large upfront investment for purchasing hardware, software licenses, and IT personnel to manage the system. On the other hand, SAP software on cloud is typically offered as a subscription service, with a pay-as-you-go pricing model.
SAP Deployment costs
SAP Business One on-premise is installed and maintained on the customer's own servers, while SAP software on cloud is deployed and maintained on SAP's cloud infrastructure. It usually costs less to implement SAP Business One software on the cloud than on premise.
SAP Scalability costs
SAP Business One on cloud offers more scalability than on-premise, as the customer can easily add or remove users and adjust resources to meet changing business needs. The ERP cost to scale small businesses on the cloud is less than implementing the ERP on a local company's servers.
SAP Accessibility costs
SAP Business One on cloud is accessible from any device with an internet connection, making it easier for remote teams to collaborate and access the system. On-premise versions may require remote access solutions or VPNs to enable remote access which limits access to users.
SAP Maintenance costs
With SAP Business One on cloud, SAP is responsible for the maintenance and upgrades of the system, but when the implementation of SAP is on the local server, the customer is responsible for maintaining and upgrading the system. If you implement SAP on your server, you will pay an annual maintenance for the use of the software and carry all the costs associated with maintaining your local server. On the cloud, the cost of the maintenance is usually included in the price. It is definitely cost effective to implement SAP on the cloud.
SAP Business One Cloud Costs
When it comes to SAP Business One on cloud, the pricing can vary depending on several factors such as the hosting option, the resources used, and the level of support required.
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Hosting Options: There are three main types of cloud hosting options: public, private, and hybrid. Public cloud hosting is when the system is hosted on a shared infrastructure owned by a third-party provider such as AWS, Google Cloud, or Microsoft Azure. Private cloud hosting is when the infrastructure is owned and maintained by the organization itself, while hybrid cloud hosting is a combination of both public and private clouds. Each hosting option has its own cost structure, and the organization needs to weigh the benefits and drawbacks of each option before making a decision.
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Resources Used: The resources used in the cloud, such as storage, bandwidth, and computing power, can affect the cost of SAP Business One on cloud. The more resources required, the higher the cost. The organization needs to analyze its requirements carefully to determine the appropriate level of resources needed for the system to function optimally.
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Level of Support: The level of support required for SAP Business One on cloud can also affect the cost. Organizations may opt for a basic support package, which may be sufficient for their needs, or they may require a more comprehensive support package that includes 24/7 monitoring and project management.
SAP Business One Cloud Pricing Subscription Model
SAP Business One can be hosted in the Cloud using either a multi-tenant or single-tenant environment, offering businesses infrastructure flexibility. The SAP Business One price for each model tier is as follows:
1) Multi-Tenant Cloud Pricing:
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Usually, there is a cost per database of about $300 to $500 per company.
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SAP Partner Hosted Professional User: $185 per user per month,
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SAP Partners Hosted Limited User: $145 per limited user license per month,
2) Single-Tenant Cloud Pricing
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Usually, you pay for your own environment which is calculated by most partners as the cost of the provider AWS or Azure plus 30% to 40%.
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SAP Partner Hosted Professional User: $140 per user per month
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SAP Partners Hosted Limited User: $100 per user per month, or
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The maintenance costs of your perpetual licenses if you owned them.
The SAP Cloud Hosted subscription model offers a flexible pricing structure, allowing businesses to pay for SAP Business One monthly with little upfront investment. After COVID, we have seen most companies moving to the cloud subscription pricing model.
SAP Business One Cloud Express Edition PaaS model
SAP Business One Cloud Express Edition is a cloud-based version of the popular business management software that is designed for small and medium-sized enterprises (SMEs). This solution is delivered through a platform as a service (PaaS) model, which means that the infrastructure, software, and support services are provided by SAP and the cloud provider.
The PaaS model of SAP Business One Cloud Express Edition allows SMEs to avoid the upfront costs associated with purchasing hardware and software licenses. Instead, they pay a monthly subscription fee that covers the cost of the infrastructure, software, maintenance and support, and professional services only. This subscription model provides SMEs with access to a powerful business management system without the need for a large upfront investment.
SAP Business One Implementation Costs
SAP Business One implementation costs refer to the expenses involved in setting up and deploying the SAP Business One software for your business. The ERP implementation costs can vary depending on various factors such as the complexity of your business processes, customer relationships, customization requirements, data migration, and the ERP implementation option you choose. Examples of implementation costs for different scenarios are as follows:
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The standard or express implementation with no customization for small businesses costs around $2,500-$5,000
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A small business with simple business processes and minimal customization may spend around $10,000-$20,000 as an implementation cost.
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A mid-sized business with complex business processes and significant customization requirements may spend around $50,000-$100,000 on implementation costs.
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A large enterprise with extensive customization requirements and multiple locations may spend upwards of $100,000 on implementation costs.
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Working with an experienced partner or consultant that provides SAP implementation services can help ensure a successful implementation while minimizing costs.
SAP Business One Maintenance Costs
The annual maintenance cost for SAP Business One for perpetual license is typically calculated as a percentage of the software's initial purchase price, usually around 20% of the license cost per year. This fee provides businesses with access to technical support, bug fixes, and software upgrades for the duration of the maintenance contract.
There are usually no maintenance costs associated with subscription model licenses. The monthly cost of hosting the license usually includes the maintenance costs.
SAP Business One Training Costs
Once the SAP Business One software has been deployed, the next step is to train users on how to use the system. Training costs refer to the expenses associated with providing the necessary training to ensure that the organization's staff can use the system effectively. Here are some factors that can affect the training costs for SAP Business One:
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Training Options: Organizations have several options when it comes to training users on SAP Business One, including online training, on-site training, self-paced training, and more. Each option has its own cost implications, and the organization needs to consider which option best suits its budget and requirements.
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Number of Users: The number of users who require training can also affect the training costs. The more users who require training, the higher the cost. It's important to ensure that all users who will be using SAP ERP are adequately trained to avoid any issues or mistakes that could impact the organization's operations.
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Level of Expertise: The level of expertise required for training can also affect the training costs. If the organization requires training on advanced features of SAP Business One, the costs can be higher. However, if the training is focused on basic features and functionalities, the costs may be lower.
Other costs for SAP Business One
Apart from licensing, cloud, the implementation cost, and training costs, there are other costs that organizations need to consider when using SAP Business One. These costs can include maintenance, support, upgrades, addons and more. Here are some factors that can affect the other costs associated with SAP Business One:
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Options for Managing Other Costs: Organizations have several options when it comes to managing the other costs associated with SAP Business One, including managing the costs in-house, outsourcing the costs to an SAP partner, or using third-party providers.
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Size of Business: The size of the business can also affect the other costs associated with SAP ERP software. A larger business with financial employees, more users, and more complex requirements may require more support and maintenance, leading to higher costs.
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IT Infrastructure: The organization's IT infrastructure can also impact the other costs associated with SAP Business One. For example, if the organization's infrastructure is outdated or not compatible with SAP Business One, it may require additional costs to upgrade or replace the infrastructure.
Is SAP Business One affordable?
Yes, SAP Business One is affordable and offers pricing models that cater to businesses of all sizes and budgets. SAP Business One price options include perpetual licenses, cloud subscriptions, and a PaaS model. Additionally, the platform offers various features and functionalities that can help businesses streamline their operations, increase productivity, and enhance their overall efficiency, making it a wise investment for organizations looking to improve their bottom line. From marketing to sales, to inventory control and financial management, you will be in control of your small business or multinational enterprise.
Finance your SAP Business One solution
To help finance the implementation and ongoing maintenance costs of SAP Business One, businesses can consider the following options:
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Financing from SAP Partners: SAP partners can provide financing options for SAP Business One implementation and maintenance costs. These financing options can include leasing, rental, and financing plans.
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Third-Party Financing: Businesses can also consider third-party financing options from banks and other financial institutions.
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Government Grants and Funding: Some governments and agencies offer grants and funding for businesses to implement technology solutions that can help improve their operations and competitiveness.
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Internal Financing: Businesses can also consider financing SAP Business One implementation and maintenance costs internally.
Conclusion
In conclusion, SAP Business One is a powerful and comprehensive ERP solution that can help organizations streamline their operations and improve efficiency. However, when considering SAP Business One price and implementation cost, it's crucial to consider all the costs associated with the system, including licensing, cloud, implementation, training, and other costs.
SAP Business One pricing and costs can vary depending on numerous factors: the size of the business, the specific business intelligence requirements of the organization, customer management and the options selected for managing the costs. By understanding the different pricing and cost factors involved, organizations can make informed decisions about implementing SAP Business One.
How H&CO can help
If you are looking to implement SAP Business One, H&CO can provide you with the support and expertise necessary to ensure a successful implementation. With over 5,000 implementations and over 30 years of experience helping multinational companies with SAP implementation, our team of international consultants can provide you with the insight and guidance you need to navigate the complexities of international business operations.
Whether you need help with implementation, training, customization, or ongoing support, our SAP consultants are here to help. Contact us today to schedule a consultation at one of our SAP offices in the United States, Mexico, Guatemala, Nicaragua, El Salvador, Honduras, Costa Rica, Panama, Colombia, Chile, Argentina, Peru, Brazil, Spain, and India.
We are ready for a successful engagement on this side of the world!
