Table of Contents
Introduction
In the past seven years, AlphaBOLD has helped many companies navigate the complex world of ERP systems, especially with our NetSuite practice, which implements, optimizes, and supports the leading cloud ERP solution. One of the most crucial selection criteria for businesses considering adopting a new ERP system like NetSuite is the investment required.
The initial investment in an ERP system includes the license cost, which can vary significantly based on modules and user count, and expenses of implementation and subsequent support services, which can be substantial. Understanding the NetSuite implementation cost is essential, as successfully deploying NetSuite requires careful planning, configuration, customization, and training — all of which contribute to the total cost of ownership.
This article aims to break down the key elements influencing NetSuite implementation costs and license fees, providing a clearer picture of what businesses can expect when embarking on the journey of NetSuite implementation. We’ll explore the various pricing models and factors that drive implementation costs and offer insights into how to budget effectively for your NetSuite project.
By understanding the overall investment, you can better align your IT strategy with your business goals, ensuring that the deployment of NetSuite contributes effectively to your organizational growth and operational efficiency.
NetSuite Licensing Costs
When initiating your journey with NetSuite, the primary expense to evaluate is the licensing cost, which is calculated based on the following:
- Edition (Starter, Standard/Mid-Market, Enterprise)
- Service Tier (Standard, Premium, Enterprise, Ultimate)
- Subscription vs SuiteSuccess
- Add-On Modules
- Number of Users
Edition:
This determines the base cost of a NetSuite license, and it’s determined by the company’s size and how it plans to use NetSuite.
| Edition | Description | General Focus | Base Price |
|---|---|---|---|
|
Starter |
Entry-level solution |
Small businesses with basic needs |
$1,000 and up per month |
|
Standard / Mid-Market |
Comprehensive ERP |
Growing businesses with more complex needs |
$2,500 and up per month |
|
Enterprise |
Scalable for large organizations |
Large businesses with high transaction volumes and complex operations |
$5,000 and up per month |
Service Tier:
Four service tiers are based on the number of users, storage needed, and monthly transaction volume. The license price will increase from the base price with a higher Service Tier.
| Service Tier | Max Number of Users | Storage Space Unit | Monthly Transaction Volume Limit |
|---|---|---|---|
|
Standard |
100 |
100 GB |
200,000 |
|
Premium |
1,000 |
1,000 GB |
2,000,000 |
|
Enterprise |
2,000 |
2,000 GB |
10,000,000 |
|
Ultimate |
4,000 |
4,000 GB |
50,000,000 |
Pricing Model:
In addition to Edition and Service Tier, companies must decide whether to adopt SuiteSuccess, which includes industry-specific bundles suitable for companies willing to adapt to most NetSuite out-of-box processes.
Choosing SuiteSuccess will likely result in a higher license cost but may reduce NetSuite implementation cost, customization, and support costs. Many AlphaBOLD consultants have experience with the SuiteSuccess methodology and would be happy to provide an unbiased analysis of the pros and cons of each pricing model for your company and your specific system needs.
Current SuiteSuccess offerings include the following verticals/industries, but new editions, variations, and updates are frequently rolled out.
- Starter – Financial Management
- Apparel, Footwear, and Accessories
- Food & Beverage
- Manufacturing
- Not-For Profit
- Professional Services
- Retail
- Software
- Wholesale Distribution
Add-On Modules:
Adding any functional modules listed below will result in additional license costs ranging from $499 to $1,999 per module.
Financial Management
- Advanced Financials, SuiteBilling, Revenue Management, Payment Automation, Bill Capture, Multi-Book Accounting, OneWorld, Dunning Letters, Fixed Assets Management, Electronic Bank Payments
Enterprise Performance Management (EPM)
- Planning & Budgeting, Account Reconciliation
Customer Relationship Management (CRM)
- Contract Renewals, Incentive Compensation, CPQ (Configure, Price, Quote)
Business Intelligence: Analytics Warehouse
Field Service Management
Inventory and Order Management
- Advanced Inventory Management, Smart Count, Advanced Order Management, Grid Order Management
eCommerce
- SuiteCommerce, SuiteCommerce Advanced, SuiteCommerce InStore, SuiteCommerce MyAccount, NetSuite Connector, NetSuite Pay
Human Resources
- Payroll, SuitePeople HR, SuitePeople Performance Management, SuitePeople Workforce Management
Professional Services Automation
- SuiteProjects, Project Management, OpenAir
Supply Chain Management
- Procurement, SuiteProcurement, Warehouse Management System (WMS), Ship Central, Demand Planning, Quality Management, Work in Process (WIP) and Routings, Work Orders and Assemblies, Advanced Manufacturing
Number of Users:
Finally, license cost is calculated based on all the criteria and choices made above and the number of users, including full-service or self-service users. When evaluating the NetSuite Implementation Cost, businesses must consider how user count impacts overall pricing.
Determining Final License Price:
NetSuite, or a solution provider, will use the most current “pricing calculator” to develop a total license price and then typically apply a discount rate on the list price. Factoring in the NetSuite Implementation Cost alongside licensing expenses ensures a comprehensive understanding of the total investment required. Some sample ranges are as follows:
| Edition | Service Tier | Pricing Model | Add-On Modules | Users | Annual List Price Range |
|---|---|---|---|---|---|
|
Starter |
Standard |
SuiteSuccess Starter |
None |
12 |
$25,000 – $50,000 |
|
Standard |
Standard |
Subscription |
Some Financial Management (FM) modules |
40 |
$75,000 – $125,000 |
|
Standard |
Premium |
Subscription |
FM + Some Inventory and Order Management modules |
75 |
$100,000 – $200,000 |
|
Standard |
Premium |
Subscription |
FM + CRM modules |
150 |
$150,000 – $300,000 |
|
Enterprise |
Enterprise |
SuiteSuccess Manufacturing |
FM, HR, Project Management, Manufacturing, Inventory and Order Management |
800 |
$250,000 – $500,000 |
|
Enterprise |
Ultimate |
Subscription |
Full suite of FM, HR, CRM, EPM, Inventory, Order, and Project Management, Manufacturing and eCommerce |
1500 |
$500,000 and Up |
Here is a sample quote for standard NetSuite implementation cost with some add-on modules for a mid-size company with relatively high transaction needs.
- Standard Edition
- Premium Service Tier
- Regular Subscription Model (non-SuiteSuccess)
- Add-On Modules: Advanced Financials, Fixed Assets, OneWorld, Procurement, Project Management
- 25 full users, 25 self-serve users
Total License Cost:
List Price $115,000, Discounted Price $80,500
Notice that a 30% discount was applied to the list price; this is only an example, and the actual discount rate may be higher or lower, as it is determined after negotiation with NetSuite or through a Solution Provider. AlphaBOLD has extensive experience helping customers obtain NetSuite’s best possible discount rate.
Further Reading: NetSuite ERP Guide: Costs, ROI & Implementation Insights
NetSuite Implementation Costs
Another major part of the overall NetSuite investment to consider is the NetSuite implementation cost. This includes the cost of hiring a consultant or implementation partner to configure and customize NetSuite to meet a company’s business needs.
The NetSuite implementation costs can vary widely depending on the modules to be enabled and configured, the complexity of business processes, the level of customization required, etc. The following table provides an average range of implementation costs for NetSuite and some of its popular modules utilizing most of the out-of-the-box functionalities:
| Edition / Module | Implementation Cost Range |
|---|---|
|
SuiteSuccess Starter |
$5,000 – $30,000 |
|
SuiteSuccess for Not-For Profit |
$20,000 – $50,000 |
|
SuiteSuccess for Manufacturing |
$30,000 – $80,000 |
|
Financial Management (FM) |
$50,000 – $100,000 |
|
FM + OneWorld + CRM + HR + Fixed Assets |
$50,000 – $100,000 |
|
FM + Order Management + Revenue Management + Contract Renewal |
$75,000 – $150,000 |
|
FM + Procurement + Demand Planning + Work Orders and Assemblies + Project Management + SuiteAnalytics |
$100,000 – $200,000 |
|
FM + OneWorld + CRM + HR + Payroll + Inventory + Order Management + SuiteCommerce |
$150,000 – $300,000 |
NetSuite Data Migration and Customization
A crucial aspect of NetSuite implementation is the cost of customization. Although NetSuite has extensive out-of-the-box features, they might not fully align with your unique business requirements. Tailoring NetSuite to fit your specific needs and workflow can be essential. The cost for such customizations can differ significantly, primarily influenced by the complexity and scope of the adjustments needed.
Also, companies often need to import historical data from legacy systems and set up integration with 3rd-party solutions. Here are some examples of cost ranges for customizing popular NetSuite modules:
| Module | Customization Cost Range |
|---|---|
|
General Ledger: customized by adding custom segments for tracking specific business units, projects, or cost centers. |
$10,000 – $50,000 |
|
Accounts Receivable/Payable: Clients might customize workflows for approvals, payment processing, or dunning to align with their internal procedures. |
$10,000 – $50,000 |
|
Item Management: Custom fields might be added to track specific product attributes, certifications, or regulatory information. |
$10,000 – $50,000 |
|
Inventory Tracking: Customizations can involve setting up specific inventory valuation methods, implementing cycle counting procedures, or integrating with warehouse management systems (WMS). |
$15,000 – $80,000 |
|
Sales Force Automation: Custom fields, workflows, and reports are frequently added to track sales opportunities, manage customer interactions, and analyze sales performance. |
$15,000 – $100,000 |
|
Customer Support: Clients often customize case management workflows, knowledge bases, and customer portals to provide efficient and personalized support. |
$20,000 – $50,000 |
|
Procurement: Customizations can include automating purchase order approvals, integrating with supplier portals, or managing vendor performance. |
$20,000 – $60,000 |
|
Warehouse Management: Common customizations include integration with WMS systems, custom picking and packing strategies, and optimized warehouse layouts. |
$20,000 – $100,000 |
|
Data Migration: Import of essential base data, including chart of accounts, customers, vendors, items, employees, subsidiaries, locations or departments, etc., and all or part of the open transactions in the legacy system, including sales orders, purchase orders, invoices, payments, credit memos, journal entries, etc. |
$20,000 – $100,000 |
|
Integration using SuiteApp Connector: NetSuite Salesforce and Shopify connectors can be configured to provide point-to-point two-way data exchange. |
$15,000 – $150,000 |
NetSuite Training Costs
The fourth cost to consider when implementing NetSuite is the NetSuite ERP implementation cost associated with training. Ensuring employees are adequately trained to use NetSuite to maximize its benefits is important. Training costs can vary depending on the training method, the number of users, and the level of training required, all of which contribute to the overall NetSuite cost.
The best way for users to be trained to use NetSuite is to be involved in an implementation or optimization project. Should additional training be needed, the following table provides a general range of additional training costs for each NetSuite module and functional track. Understanding NetSuite pricing and how training fits into the total investment can help businesses budget effectively.
| Module / Function | Training Cost Range |
|---|---|
|
Financial Management |
$3,000 – $10,000 |
|
CRM |
$2,000 – $15,000 |
|
Other Add-On Modules (each) |
$2,000 – $20,000 |
|
Time / Expense and Report User |
$1,000 – $5,000 |
|
Accountant / Controller |
$3,000 – $12000 |
|
Inventory / Supply Chain Manager |
$2,000 – $8,000 |
|
Customer Support Manager |
$2,000 – $8,000 |
|
Reporting and Analytics Manager |
$2,000 – $20,000 |
|
Sales Representative / Manager |
$1,000 – $5,000 |
|
NetSuite Administrator |
$5,000 – $50,000 |
Maximize Your NetSuite ROI with AlphaBOLD
Maximize your investment by understanding the NetSuite implementation cost. AlphaBOLD's consultants can help optimize processes, reduce costs, and enhance efficiency.
Click HereNetSuite Ongoing Support Costs
The final cost to consider when implementing NetSuite is the cost of ongoing maintenance and support. This includes the cost of software updates, bug fixes, and ongoing technical support. The cost of ongoing maintenance and support can vary depending on the support required and your organization’s size. The following table provides a general range of ongoing maintenance and support costs for each NetSuite module:
| Module | Support Cost Range |
|---|---|
|
Basic Customer Support by NetSuite |
$1,000 – $2,000 |
|
Enhanced Customer Support by NetSuite |
$2,000 – $5,000 |
|
Advanced Customer Support by NetSuite |
$3,000 – $10,000 |
|
Managed Services – Basic (manage users and roles assignments, new user onboarding and training, manage sandbox, interact with NS Support) |
$2,000 – $5,000 |
|
Managed Services – Enhanced (+ work on forms and reports, manage new release process, diagnose and resolve business and technical issues) |
$3,000 – $8,000 |
|
Managed Services – Advanced (+ Initiate and Manage Optimization and Customization projects, support integrations and third-party solutions) |
$5,000 – $15,000 |
|
Standard Support Package – Monthly or quarterly package with the dedicated support team, no predefined scope, service level agreement (SLA) based on severity, commitment to use a certain number of hours, and may incur a small monthly charge for access to support portal |
Varies with minimal monthly charge |
|
Premium Support Package – Standard Support Services with a higher number of hours committed but potentially lower hourly rate and tighter SLA |
Varies with minimal monthly charge |
|
Support Bucket of Hours – Commitment to several hours of services for a quarter or other period; rate varies based on the number of hours committed, may have SLA and access to support portal as in support packages |
Varies by number of hours committed
and used |
|
Ad Hoc Support Package – Time and Material with no minimum hours committed, may have dedicated support team, SLA, and access to support portal as in support packages |
Varies by hours used |
Additional Potential NetSuite Cost
- Usage – NetSuite will charge you or make you upgrade to the next Service Tier if your transaction volume goes beyond the limits for your current tier or limits for the modules.
- Third-Party Solutions – NetSuite partners offer many specialized solutions integrated with NetSuite and provide functionalities that NetSuite does not offer, but there will be license and support expenses for these applications.
- Integrations and Customizations – More integrations with non-NetSuite systems or customizations to NetSuite will incur more initial development costs and higher support costs.
Further Reading: Beyond the Price Tag: Uncovering NetSuite’s Hidden Costs
Total Cost of Ownership (TCO) for NetSuite
Calculating NetSuite’s Total Cost of Ownership (TCO) involves several components. Here’s a step-by-step approach to help you estimate the first-year TCO for a sample mid-size company with 500+ employees, above-average usage of NetSuite functionalities and features, plus a moderate amount of customizations.
Note: Please remember that these numbers are just to help you understand how to calculate your TCO. Feel free to omit or add any costs relevant to your business needs.
- Licensing Costs: Standard Edition + Premium Service Tier with 80 users: List Price $120,000, discounted price $84,000
- Implementation: FM + Procurement + Demand Planning + Work Orders and Assemblies + Project Management + SuiteAnalytics: $60,000
- Data Migration and Customization: Basic data migration, integration with Salesforce CRM, procure-to-pay workflow customization: $45,000
- Training: Accounting and operation users training: $18,000
- Managed Services: Enhanced NetSuite Administrator services with $5,000 a month for six months (after go-live): $30,000
Total Estimated TCO - First Year
- Licenses: $84,000
- Implementation: $60,000
- Data Migration and Customization: $45,000
- Training: $18,000
- Managed Services: $30,000 (six months)
- Total First-Year Cost: $237,000
Actual costs will vary based on specific business requirements, the extent of customization, and other factors.
Optimize Your NetSuite Implementation with AlphaBOLD
AlphaBOLD helps you ensure a smooth and cost-effective NetSuite deployment to streamline your business operations.
Click HereConclusion
A consulting firm like AlphaBOLD can help companies control NetSuite costs by thoroughly assessing needs to select the right editions and modules, optimizing implementation to minimize customizations and leverage standard by strategically managing the NetSuite implementation cost, AlphaBOLD ensures businesses maximize their return on investment while keeping expenses predictable.
AlphaBOLD also offers ongoing support and managed services, and we will provide guidance along the way to ensure continued efficiency and cost-effectiveness in utilizing NetSuite. We’d be more than happy to accompany you through your journey with NetSuite!
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