ERP Pricing and Calculating your Return on Investment

Are you thinking about taking the plunge into an ERP system? Well, congratulations. ERP software, or enterprise resource planning software is the biggest thing to hit the manufacturing world and it’s easy to see why. With ERP systems, you can easily organize, manage and implement your entire business from finances to human resources, from logistics to project management, with one system. Your ERP system will literally become your hardest working employee. However, he will come at a price. ERP price will depend on a variety of factors but, for the most part, you can expect to pay around $10,000 per user per year for a large business ERP system. Of course, small businesses can expect to pay a lot less.
 

So what needs to be factored in when looking at ERP pricing?
 

The Four Factors of ERP Pricing

First of all, you need to look at the cost of the software. This will be based on your company's size among many other things. The ERP software is the database and system that will be installed on your company. It is the most important factor in pricing but it is certainly not the only factor.

The other three factors include the hardware, the training and the additional professional services you will need such as customization.
 

Calculating your Return on Investment

Essentially, when it comes to ERP pricing and determining if the system is wrht your while, you are going to need to look at the return on investment. And, to do this, you will need to look at three different factors:
 

• Implementation of the program: implementation of the ERP system is more than just installation. It involves training your staff to use the program and making it benefit everyone. You will need to factor in the time and effort spent on training in order to determine if it is worth your while
• Future goals: second of all, you will need to see what your future goals for the company are. If you are planning on expanding your business, then ERP systems can most certainly help you do this.
• The Organizational Factor- on average, you need to look at how much time your staff spends each day on organization and redundant chores that will be easily handled and managed through the ERP software. In most instances, you can stand to save several hours each week by using an ERP system as your backbone.

Need Help? 

All three of these factors can be fairly hard to understand off the bat which is why it’s so important to use an ERP vendor who can help you make the calculations and see how much you stand to make versus how much you can expect to pay. They will maticulously go through the different systems with you to make sure you have a firm grasp before you start. To get started on the ERP pricing calculations, simply fill out the form on this page. You can be well on your way to making the calculations and pricing an EPR system for a more systematic future.