What's the Street Price of SAP?

Mengoxon asks: "Many software/hardware companies for enterprise solutions (BAAN, Oracle, PeopleSoft, ...) offer informative websites, but one thing that is always missing is the price. Whether they are afraid to let the competition know (they know anyway) or whether they don't want to shock potential purchaser 'Our suggested retail price is $800.000' or whether they first want to understand your company to do some price descrimination. I don't want to tell all my company details just to find that the price of something is way out of my league anyway and I don't want to be hassled by sales personnel while I am still in 'consideration stage'. Some companies want your general contact information BEFORE they pass out informational materials, like whitepapers! Is there any website out there where IT people can openly exchange and find out price information and evaluations of enterprise solutions before they get caught in the machinery of an enterprise solutions sales department? I know that the price of a solution is dependent on the size of the solution but if a sales person can work out the price from a few facts about the customer, then any sane IT person can probably compare an offer to another company and relate it to his own situation!"

Comments

Time and Materials...

[gus goose]

I have worked for SAP "partners" in the UK, and I am fully aware of their strategies.

The bottom line is that SAP and most other large packages are very stable in the sense that there is not much new developpment. Their strength is in their perceived stability.

The drawback is that the model is not very flexible. SAP would never admit it, but their modules are based on "best practices", and very few businesses actually have bast practices.

Thus, to get SAP installed, it needs about 50% customisation of the code, and 50% customisation of the business. Neither of these are cheap.

Now, SAP really makes it's money on the installation, and not on the actual software. For an installation, they get to throw a number of consultants, and a number of ABAB programmers at the client, all substantially marked up. They talk in riddles alternating between MBA style management consulting, and at very basic ABAB concepts. Neither of these are in the real reach of the customer, and the customer is bent / masaged / coerced to fit the SAP mould.

Although I am biased, and am rather cynical, I believe that the above holds an element of truth.

The short answer to your question is that SAP will not tell you the proce of the product because:

1. The software is licensed on a scale related to the customer's size, support requirements and status.
2. SAP will have a licensing structure which is often significantly discounted, but not all discounts are equal. They do not want their customers to be able to easily price shop.
3. The bulk of the money comes in through implementation through customisation / consultancy. This is, if SAP is successful, performed on a time and materials basis, and thus the costs rapidly escalate.
4. Competition is quite fierce with people like Oracle, and price quoting is a bad thing if your business sales pitch is based on reputation and goodwill, not a "good bargain".
5. SAP will drain every penny they can get, and the price is really an Arm and a Leg (literally if you count the staff turnover generated by job redundancy and change stress, as well as scape-goatism).

Basically, be prepared to pay more than you bargained for, whatever you are quoted.