SAP Business One vs NetSuite [ERP Comparison for SMEs]
As you’re evaluating ERP solutions, chances are SAP Business One and NetSuite will both make it onto your list at some point. And for good reason – they’re two of the leaders in the small to mid-size ERP space. Both are comprehensive ERP solutions designed to support growing companies across a range of industries, from distribution to services, manufacturing and more.
In your research, you’ve likely come across conflicting information. So, we’re breaking down the big differences between the two solutions to help you cut through the noise and make an objective assessment for your business.
Deployment methods and licensing
This is the number one difference you’ll hear about in comparisons of SAP Business One and NetSuite – cloud versus on-premise. But it’s more a matter of public versus private cloud.
NetSuite is a cloud-based ERP solution with over 24,000 customers. Their multi-tenant cloud platform offers easy access to your ERP system through a web browser. You don’t own your ERP software and your data is available to you with a monthly base platform fee, plus a fee for each user.
While traditionally recognized as an on-premise ERP solution, SAP Business One offers cloud deployment options as well. The most popular option is a private cloud solution – you get the advantages of public cloud, with the additional control of an on-premise system. This best of both worlds approach lends itself well to a hybrid cloud ERP solution that gives you maximum flexibility to accommodate the needs of your users.
Control over system upgrades
Because NetSuite is a public cloud solution, customers have minimal control over system upgrades. They’re deployed to customers on a pre-determined schedule with a small amount of flexibility in the maintenance window. Depending on your perspective, this could be a positive or a negative. On the plus side, you’re always running the latest version of the software, giving you access to bug fixes and new features. On the flip side, this approach increases the chance of breaking customizations or integrations. You can easily mitigate the risk by working closely with your NetSuite implementation partner to create a plan for updating and testing integrations in advance of the upgrade timeline.
Whether you run SAP Business One on-premise or in a private cloud, you have total control over the timing of your upgrades. You can coordinate upgrades of your ERP system and any customizations or integrations to avoid disruption to the business. Keep in mind that while you can opt out of upgrades and stay on an older version, you won’t have access to new functionality. And you can typically expect more effort on major version upgrades compared to incremental updates.
System customization and integration
For smaller businesses with relatively simple business processes, standard functionality in either ERP system will likely do the trick. But some companies find they need to tailor the solution to accommodate unique workflows or requirements. And while your ERP system houses your core business data, there are cases where integrating with other applications makes sense. In either of these cases, it’s important to understand how much flexibility you have and the limitations of different approaches.
NetSuite is built around a suite of products that can be added for additional functionality. You also have access to the SuiteApp ecosystem of solutions that can be easily integrated to extend functionality. NetSuite uses point-and-click app customization that allows customers to tailor their system on their own. For example, you can quickly configure processes, the user interface and reports. Their SuiteCloud Platform offers additional flexibility to create extensions and integrations where truly custom solutions are required.
While SAP Business One includes most core features in the base platform, they also offer a robust ecosystem of certified add-on solutions for industry-specific needs. In cases where you need to create custom workflows or integrate with best-of-breed applications, SAP Business One offers maximum flexibility.
Regardless of the solution you choose, when it comes to customizing your ERP solution or integrating with other systems, we recommend working with a qualified ERP partner. Unless you have the in-house expertise, a partner with ERP development experience is your best bet to ensure a seamless solution.
NetSuite implementations can take a couple different forms. The SuiteSuccess model provides a fixed price implementation that’s designed based on industry needs and best practices. This gets you up and running quickly, while keeping costs low. This approach can work well for many companies, particularly if they have simple, standardized processes. If you have more complex needs and require significant customization or integration, you'll likely be a candidate for a more traditional time and materials implementation.
SAP Business One projects can be implemented in a comparable timeframe. But they’re typically priced based on time and materials, which introduces greater cost variation. The benefit of this implementation approach is an ERP solution that’s more tailored to your business needs. You can also mitigate costs by finding an implementation partner that uses a hybrid approach. They charge a fixed price for system design, then time and materials for the implementation. This gives you better visibility into the implementation cost and mitigates scope creep.
Ability to migrate your data to another ERP system
When selecting your ERP solution, you should always understand your exit options. You should only need to migrate to another solution if you outgrow your solution, or if it simply doesn’t meet your needs as expected. (This is an unfortunate situation that does happen sometimes – you can avoid it by selecting the right ERP system the first time.)
While you can absolutely get your data out of NetSuite, it won’t necessarily come in a relational format. You’ll likely end up with a series of spreadsheets that you'll need to parse through before migrating into a new system.
If your SAP Business One system is hosted in a private cloud, you can obtain a copy of the ERP database or get copies of the full virtual machines (i.e. the servers) that are running your ERP system. This makes it easy to move your existing solution to another private cloud provider (or on-premise) with minimal fuss. But if you're moving to a new system altogether, you'll be exporting into spreadsheets for data migration, same as you would with NetSuite.
The reality is that if you're switching to a new ERP system, you'll be importing data via spreadsheets anyway. So, having a copy of your database may not be all that important. The point here is to always read the fine print in your contract so you understand how you will obtain your data if you decide to move to another ERP system in the future.
Which ERP system is the better choice – SAP Business One or NetSuite?
We’re big believers in the right solution for the right customer. What does that mean? There’s no one single ERP solution that will be best fit for every company. At the end of the day, the best ERP solution for your company is the one that meets your needs and helps you achieve your objectives.
As a Canadian partner for both SAP Business One and NetSuite, we know the ins and outs of both solutions. We can help you determine which one is the best fit for your company.