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8 min read

SAP vs. Competition: Making the Right ERP Choice for Your Unique Business

You have a growing business and your existing systems may no longer be up to the task of managing all the complex elements of your day-to-day operations. Perhaps you’re a manufacturer and you need more robust warehouse management to make sure everything is in the right place and can be easily tracked. Or maybe you don’t have access to all the detailed, customized reports you need to ensure that you’re making the most informed business decisions possible. 

At this point, you may think, “Maybe it’s time to implement an ERP solution that can adapt and grow with my business. But where do I start? There are so many options and everyone claims their solution is the best. It’s dizzying and I could use some help.” 

If this sounds like you, we’re here to help. We’ve created this overview of some of the most popular ERP solutions and how they compare to one industry-standard solution that has served as a benchmark in the small-to-medium-size business sector for the last two decades – SAP Business One. With more than one million end-users from over 65,000 SMBs across 170 countries, this ERP solution is a great place to start when assessing options for your business. 

 

SAP Business One vs. NetSuite ERP 

Deployment options should be front and center when evaluating these two popular ERP systems. Business One is most often deployed on-premises, meaning that the system is installed on your servers and remains on-site. This enables your team to choose the hardware and perform ongoing maintenance the way you want. You have total control. Alternatively, you do have the option of installing Business One in the cloud, usually with your solution partner hosting. Even with the cloud version, you still maintain control over the timing of updates. By contrast, NetSuite ERP is hosted exclusively in the cloud, accessed through a web browser or mobile device without special software. If you don’t like hassling over updates and backups, NetSuite takes care of these tasks automatically. However, you relinquish control over when these occur and any related downtimes. 

The licensing/cost models are quite different between the two systems. For its on-premises version, SAP Business One involves a perpetual licensing model in which you purchase your licenses and retain them forever. The cloud version employs a subscription model for licensing in which you pay a monthly fee. Typically, the initial investment for on-premises implementation is higher but eventually pays off over the long term. NetSuite uses a monthly subscription model with a monthly base fee, a per-user fee and additional costs for add-on modules. If you have a large company, this model could be quite costly over time. There are many other fees associated with both approaches that are dependent on your company’s unique requirements. We urge you to explore the details on each company’s site so that you can assess which system and model works best for your business. 

Implementation of the two systems is quite different given the contrasting deployment options available. Business One users usually rely on a trusted SAP Business One partner to perform this service, and the system does allow for a seamless migration of your existing data into the system. NetSuite offers the option of a fixed-price model that is effective for standard industries and smaller companies that don't have a lot of complex data. Larger companies with more complex data and in need of more extensive customization must pay the time and materials rate to complete their implementations. 

Summation 

Both SAP Business One and NetSuite ERP offer robust business automation solutions that will fulfill the needs of SMBs in a wide variety of industries. If customization and control are essential to the way your company conducts business, we think Business One may be a better choice. Conversely, if your preference is to keep all of your systems in the cloud and to avoid potential headaches of installation and managing updates, NetSuite might work better for you. Again, be sure to do your research on both products and consult experts in the field to help you make the most informed choice. 

 

SAP Business One vs. Sage X3

Scalability is a key consideration when comparing these two systems. SAP Business One is designed for small-to-medium-sized companies, so users will need to add SAP's HANA database in order to effectively handle enterprise-level processes. Sage X3 is designed to manage the data requirements and number of users (up to 2000) of mid-market businesses with healthy growth potential.

Different ERP platforms provide features and functionality that stand out (or not) with respect to “verticals” or specific industries. So, when researching potential ERP solutions for your business, consider how each option has performed historically in your industry. SAP Business One is akin to a “utility player,” in baseball parlance – it offers the flexibility and range of a full-featured solution to fit various small-to-midsize businesses and industries such as consumer products, retail, light manufacturing, wholesale distribution and professional services, just to name a few. However, if your company employs highly complex manufacturing and/or distribution processes, Sage X3 may work better for you. It has features geared explicitly towards tracking products all the way through the supply chain and, thus, is well suited to address the needs of construction, discrete manufacturing, chemical companies, and food & beverage.

Deployment options are somewhat similar between the two products. Both solutions can run in the cloud or be installed on-premises. Both also offer on-premises licensing and a subscription-based model for cloud versions with pricing based on the number of users. In terms of price, both ERP solutions are priced similarly, whether cloud-based or on-premises. Visit each product’s site or contact a trusted business partner to drill down further into the relative costs for your business. 

Summation 

It’s critical for you to evaluate which of these two options better serves your unique industry and the anticipated growth trajectory of your business. Primary considerations must include features, security, scalability, licensing structure and total costs of ownership over the long haul. If you’re forecasting rapid growth well into the future, you may find the core SAP Business One ERP solution doesn’t quite scale to your projections, unless the robust HANA database is appended. Also, if your business operates in an industry that relies on complex manufacturing processes, Sage X3 may be a better fit. Conversely, if advanced analytics and reporting are at the top of your list of requirements, SAP Business One (with the HANA database added) is likely to better serve your purposes. 

 

SAP Business One vs. Quickbooks + Fishbowl 

Many small businesses start out with Quickbooks to manage their financial data and accounting. It’s the industry standard for getting up and running and keeping costs to a minimum. But what happens when your business grows beyond the capabilities of Quickbooks and you realize that you require a more robust ERP system? Let’s take a quick look at how the combination of Quickbooks + Fishbowl ERP stacks up to SAP Business One

Quickbooks + Fishbowl is targeted to smaller businesses such as small manufacturers, retailers and e-commerce businesses. It’s relatively inexpensive to integrate Fishbowl, with a starting price of $1,500 for a single-user license and $500/year for a QuickBooks single-user license. When integrated, inventory, purchase orders and sales order tracking are conducted in Fishbowl, while bill-paying is managed in QuickBooks. Fishbowl's affordability, flexibility and warehouse tracking are deemed strengths while its e-commerce, inventory management and inventory forecasting are considered weaknesses. Overall reporting capabilities are limited in number and in degree of customization. Inventory management is basic, offering only basic stock control and inventory reporting. While Fishbowl’s CRM module augments the limited functionality of that in Quickbooks, it’s still quite limited, lacking any marketing automation features. Language support is limited to only English, Spanish and French. Also, despite the supposed seamless integration between the two platforms, glitches are known to occur when moving data between them, which may result in data entry errors and duplication of effort. 

As expected, given the difference in the target markets for these two solutions, SAP Business One out-performs Quickbooks + Fishbowl in most metrics. Of course, it’s also more expensive to implement, with a single-user license costing $3,499 and significantly higher expenses for implementation. SAP Business One can also be licensed as a monthly subscription. Business One’s reporting, CRM and inventory management capabilities are much more robust, both in terms of scope, customization and automation options. Business One offers English, Spanish, French, German, Italian and Brazilian Portuguese language support. Also, since everything resides on one platform, you’ll never have to worry about data errors and redundancies that can plague users when two separate platforms are involved.  

Summation 

The takeaway from this comparative evaluation is pretty straightforward – SAP Business One delivers more power, functionality and breadth than Quickbooks + Fishbowl. However, when putting these two systems side by side, a cost/benefit analysis is essential. If your business involves complex processes and requires more sophisticated reporting, Business One is likely a better fit and warrants the additional investment, which will likely pay dividends down the road. If you don’t see your business growing to the point that a full-blown ERP solution is required, it may not be justified to make the increased investment that Business One would require. We encourage you to assess your growth path, especially regarding number of users, data complexity, reporting and specific industry requirements before making a final choice. 

 

SAP Business One vs. Microsoft Dynamics 365 

SAP Business One and Microsoft Dynamics 365 are both highly reputable ERP platforms for SMBs. Both offer an extensive array of modules and integrations to help you construct a comprehensive solution that will fit your unique industry and business. Not surprisingly, MS Dynamics 365 integrates with a slew of other Microsoft products, and over 750 add-ons are currently available. Business One doesn’t match MS Dynamics 365’s number of add-ons but does integrate with a broad range of third-party applications to help adapt the system to a specific industry. Business One does, in fact, lean more toward specific verticals, especially those in manufacturing, distribution, consumer products, professional services, wholesale and retail.

Keep in mind that Microsoft Dynamics 365 actually consists of two ERP products – Business Central, which is geared toward SMBs, and Dynamics 365 for Finance and Operations, which is suited to larger enterprises. So even though Microsoft positions Business Central as a fully scalable solution for companies of any size, the truth is that if a company outgrows Business Central, they’ll need to upgrade to Dynamics 365 and learn a new system. 

Deployment options are a bit like mirror images of one another: Dynamics 365 Business Central typically runs in the cloud on Microsoft servers but can be implemented on-premises. As we’ve noted in previous synopses, Business One is more often implemented on-premises but can run in the cloud. Pricing for Dynamics 365 Business Central's licenses is per user per month and increases with each add-on integrations. Business One’s price structure and perpetual licenses are based on deployment preference, license type and the number of users. On-premises software involves a one-time fee plus an annual upgrade fee. The cloud-based solution requires a monthly subscription fee. Be sure to visit each product’s site for more details on pricing. 

Reporting is quite powerful in both systems as both offer customizable real-time reports that support multiple departments and help management make well-informed decisions. In addition, both ERP packages use AI to help automate business functions and offer predictive analysis. 

Summation 

For most SMBs, both SAP Business One and MS Dynamics 365 offer compelling reasons to drill down more deeply to determine which option provides a better fit. Considering that scalability, reporting and the wealth of add-on options are all strengths, unless you’re operating in a vertical that is favored by Business One users, choosing between the two could be challenging. We encourage you to work with a business partner to help determine which product offers the better fit.

 

Conclusion 

We hope that you’ve found this quick comparative evaluation between SAP Business One vs. NetSuite, Sage X3, QuickBooks + Fishbowl and Microsoft Dynamics 365, useful. As you’ve noticed from these synopses, it’s “different strokes for different folks,” so to speak. If you’re just starting out with relatively simple needs and don’t foresee much growth into the future, you might be in line for QuickBooks by itself or with Fishbowl ERP added. If you’re growing into a larger company that has highly complex data and enterprise-level requirements, you might be taking a closer look at Sage X3 or SAP Business One with the HANA database added on. For just about everything in between, Business One, NetSuite and MS Dynamics 365 may warrant a closer look. 

Once you’ve visited each product’s site and looked at their pricing, scalability, modules, features, add-ons, deployment option and more, the next step should be to contact a reputable business partner who can conduct a needs analysis and make a recommendation based on the unique requirements of your business. 

Article reposted with permission from Michell Consulting Group

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