The ERP market can be a confusing place.
There are so many variables when selecting a system, it can be hard to find answers to the important questions you have about ERP cost, deployment methods, or even the time it takes to choose a system.
We’ve gathered and analyzed data from almost three thousand projects that were active in the past year in our 2020 ERP project report to answer all your questions. Specifically, we’ve looked at cost per user, project timeframes, budgets, and hosting preferences.
Our ERP research provides a comprehensive overview of what selecting enterprise software looks like in 2020.
Quick jump to:
- How much ERP costs
- How many people in a company use an ERP?
- How long does it take to select ERP?
- Do companies want an on-premise or cloud-based ERP?
- Why do companies implement ERP?
Here is a summary of some of our key findings:
1. The average budget per user for an ERP project is $9,000.
The most common question asked about ERP has to be: how much does ERP cost?
Well, according to our research from the past five years, you can expect to spend about $9,000 on each user of your system. This is the average budget per user across businesses of all sizes over a five year period, but you’ll find this number varies depending on business size and the number of users.
This is an increase from our 2019 ERP project report data where the budget was $7,200 per user.
2. On average, 27% of employees use a company’s ERP system.
If you’re implementing a system, you need to know who is going to need to use it.
Our ERP report data found that 27% of employees are users of their system, again this varies due to business size, but combined with the above cost information, this can help you create some accurate budget estimations relative to your organization size.
As companies grow in size, our ERP research shows that the percentage of employees actively using their system decreases.
3. On average, companies spend 17 weeks selecting ERP.
The process of selecting an ERP may seem long, but most companies spent only 17 weeks choosing their system.
Typically, larger companies spend longer selecting their ERP, likely due to a larger number of stakeholders in the business that must be consulted during the selection process.
4. Over 92% of companies were considering a cloud-based solution.
The rise of cloud-based software has been the subject of much debate, and our data supports that it has begun to dominate the ERP market.
The preference for cloud-based systems vs on-premise ERP has shifted with less than 10% of businesses specifically searching for an on-premise solution. Whereas, more than 50% of businesses were looking exclusively at cloud-based solutions.
Interestingly, a significant portion of companies don’t list a preference for a cloud or on-premise solution which could indicate the hosting method of the system has less significance to a large number of businesses now.
5. The top reason for implementing an ERP is to support growth.
A significant number of companies are growing, as evidenced by this year's report, and looking for software to grow with them.
It is positive to hear that businesses are using ERP to support their business growth.
Our 2020 ERP report found that increasing efficiency, and gaining greater functionality made up 48.3% of the reasons for implementing a new ERP system. This year, this reduced to approximately 35% of the reasons for implementing a new system.
Read more interesting statistics and gain a full overview of the ERP market by downloading the full Software Path 2020 ERP Software Project Report.