The real cost of an open-source ERP: servers, installation, maintenance
“Open source means free” is only half true. ERPNext has no licence fee per user, but making it usable every day in a shop still costs something, in money or in time.
This article gives no figures, because server and service prices vary by place and over time. Instead it lists the items you need to estimate, so you can ask the right people for prices and compare them.
Getting started
| Item | What it covers |
|---|---|
| Installation | building the server, installing ERPNext, setting up the domain, security certificate and backups |
| Business setup | company, warehouses, item groups, tax templates, print formats, role permissions |
| Data migration | lists of items, customers and suppliers, and the opening stock |
| Training | the time users need to get used to it, often underestimated |
Setup and migration depend heavily on how tidy your current data is. An item list with consistent codes cuts this part down considerably.
Every month
| Item | What it covers |
|---|---|
| Server | rent for an online server, or power and connection costs for one on site |
| Backups | storage for copies kept away from the server |
| Monitoring | someone who notices when the system slows down or stops |
| Support | a support contract if outsourced, or working hours of someone in the shop |
Over time
| Item | What it covers |
|---|---|
| Version upgrades | testing on a copy, then upgrading the live system |
| Customisations | each one adds work to future updates |
| Growth | more warehouses, shops or users: usually no extra licence fee, but more setup work and possibly a bigger server |
Estimating for your own shop
- Write down how the shop works today: who enters what, where and when.
- For each item above, decide who does it: yourselves or someone you hire. If yourselves, note the hours; if hired, ask for a quote.
- Add up the first year and the following years separately. The first year is usually much larger.
- Compare with what the current way costs, including costs few people count: hours spent reconciling spreadsheets, sales lost to stock-outs, stock left too long.
If step 4 shows the current cost is still small, you may not need to switch yet. The article “When not to use ERPNext yet” in the basics group says more about this.
About M&C ERP for small shops
M&C ERP is built on ERPNext. Information for small shops in Japan is in preparation. If you would like to hear about it, register through the inquiry form on this site.