As a leading NetSuite Solution Provider, we are often asked questions related to NetSuite pricing and licensing.
- How would you describe the NetSuite pricing & licensing model?
- How much does NetSuite cost per user?
- How can I save money on NetSuite pricing given their licensing model?
Therefore we bundled (and updated for 2019) all of our best content together to create "The Ultimate NetSuite Pricing Guide".
This guide is designed for business leaders considering NetSuite ERP solutions. Our goal is to arm you with the necessary information on how to get the most out of your NetSuite evaluation and purchase experience.
And ultimately to help NetSuite buyers avoid saying: "if only I had known..."
Table of Contents
- NetSuite Pricing: How to Save Big on NetSuite Cost
- NetSuite Pricing: NetSuite CRM & ERP Pricing Model Explained
- NetSuite Pricing: Overview of NetSuite's Price per User
- NetSuite Pricing: NetSuite E-commerce Pricing Explained
Chapter 1: How to Save Big on NetSuite Cost
Licensing NetSuite can be confusing for first time buyers. It's unlike many other large software ecosystems where you can only license software from the software vendor. Examples of this approach include vendors like Salesforce or Oracle. With this arrangement licenses are facilitated through corporate sales reps and professional services are usually performed by authorized partners.
NetSuite licensing is also unlike Microsoft (Dynamics) where you can only work with a partner for both licensing software and providing services.
When it comes to licensing NetSuite, its not an either or approach. You can work with a NetSuite partner, known as a NetSuite Solution Provider. Or you can work with an accounting agency that is affiliated with NetSuite's BPO program. Or you can work with NetSuite's direct sales and services team.
Keep reading to learn about the pros and cons of each approach.
NetSuite's Direct Sales & Service Team
NetSuite’s direct sales organization consists of commissioned telesales reps segmented by industry and company size.
The direct sales organization offers their own professional services and an implementation methodology known as SuiteSuccess. SuiteSuccess, in a nutshell is a productized implementation methodology designed to get clients live on NetSuite within 100 days or less.
SuiteSuccess is ideally suited for companies with simpler needs and within specific industries.This approach tends to fall short for larger or more complex organizations and those looking to take advantage of a best of breed approach with software.
NetSuite's directs sales and service team tends to be a bit more rigid during their evaluation and scoping process. Particular buyers desiring a highly structured sales process will find this approach preferable. Experienced ERP buyers on the other hand may find this method to be cursory, lacking depth and pliancy, that can only be conveyed by an experienced senior consulting organizations. Some former NetSuite customers claim the direct sales team to not be forthcoming with NetSuite pricing information during the sales process.
For example, here's just one account from G2Crowd:
Potential benefits of working with NetSuite directly:
- Direct access to the software vendor and its employees - some customers prefer this approach.
- Can support very large global deployments
- Structured sales methodology and lots of resources for product demonstrations.
- Newer (or acquired) products may require NetSuite Professional Services team to implement.
Potential drawback of working with NetSuite directly:
- One methodology (SuiteSuccess)
- Rigid evaluation & implementation process
- Limited inhouse technical, integration and 3rd party services
- Professional Services and support tends to be more expensive than working with a partner.
- Hard to pinpoint single "throat to choke" when issues arise
- Multiple sales contacts
- Multiple support contacts
- Multiple consulting contacts
- NetSuite's sales and service approach creates a loss of continuity throughout the life cycle of the software usage. You'll be working with multiple folks for the evaluation, purchase, implementation and ongoing support of the application. Many customers cite feeling abandoned after going live on the software
NetSuite BPO Partners
NetSuite’s BPO program is designed for accounting agencies that bundle software and recurring accounting services into a monthly package. With the BPO program, you do not license your own NetSuite instance that you can customize and configure for your specific business. Instead the BPO partner provides you with a NetSuite instance based upon the agreed upon deliverables.
The BPO program is ideally suited for well funded small companies that have high growth potential potential but do not desire to staff an accounting and finance team.
Potential benefits of working with NetSuite BPOs:
- Outsourced accounting service combined with NetSuite software
- Single vendor relationship for NetSuite software and accounting services
Potential drawbacks of working with NetSuite BPOs:
- If you decide to bring accounting in-house you will require a new NetSuite instance and implementation should you decide to stay on the NetSuite platform.
- Hard to take advantage of the customization capabilities NetSuite is known for in the industry
NetSuite Solution Provider
NetSuite Solution Providers are consulting organizations with a diversity of backgrounds. Some partners consist of technologist, management consultants, software developers, former end users, and integration experts or a combination of each.
The main objective of a NetSuite Solution Provider is to help first time ERP buyers evaluate whether or not NetSuite is right for them and propose a combination of software and professional services designed to meet the needs of the organizations goals.
NetSuite Partners can custom tailor an evaluation approach aligned with the buyers needs and intentions. There's no one size fits all approach to evaluations, scoping and methodologies with NetSuite Partners, unlike that NetSuite's direct sales team.
NetSuite Solution Providers and NetSuite’s direct sales team work off an identical NetSuite price sheet, so on the surface, it appears there isn’t any inherent pricing advantage of going direct vs. working with a partner. All things being equal this is true. But like most things in life, licensing and implementing NetSuite is a bit more nuanced than this. Only after you factor in services, integrations, customizations and potential 3rd party add-on's can you get a good read on the overall cost to deploy a NetSuite solution.
Potential benefits of working with NetSuite Partners:
- Direct access to the software vendor employees plus...experienced consultants help you evaluate and acquire NetSuite software.
- Provide multiple implementation methodologies and other necessary services (e.g. customizations, integrations, post go-live optimization services)
- Some partners contain industry specific intellectual property (IP) designed to provide more value and faster deployment time.
- Single point of contact - “one throat to choke” if things go sideways. No loss of continuity between the time of evaluation, purchase, implementation and on-going support.
Potential drawbacks of working with NetSuite Partners:
- NetSuite’s growth has created a surge in new partners - be sure to find reputable partner with substantial NetSuite depth. Many new partners are existing Oracle, Sage and Microsoft consultancies and see the demand for NetSuite products and services and they dont want to lose out.
- A small subset of niche products (e.g. NetSuite Payroll & SuiteCommerce InStore POS) may require NetSuite resources to implement. In this situation NetSuite Solution Providers still oversee the overall NetSuite engagement, they just pull in specific NetSuite resources as necessary.
Information is Power
By working with a NetSuite Partner for NetSuite licensing they will educate you on the potential pitfalls that come with NetSuite licensing, after all it's what we do for a living.
One common mistake we see from potential NetSuite buyers is the thinking that they can renegotiate their NetSuite licenses next year when the subscription expires. The most important transaction you will ever conduct is the initial. All future renewals are predicated on the initial Subscriptions Software Agreement (SSA) and license estimate you originally signed. Therefore it's important to get it right the first time.
What do the customers say:
NetSuite Cost Saving Tip #2: Time the purchase
Whether its furniture, cars or software, when you buy is as important as what you buy. For many buyers, this is common knowledge however if you’ve never purchased enterprise software keep reading.
Publicly traded software companies like Oracle, Salesforce, Microsoft, etc. are laser-focused on their monthly and quarterly performance, almost to a fault. If they catch wind of a potential "deal" on the final business days of the month or quarter, you will have the full attention of senior management to make a deal happen. If it’s the final business day of the fiscal calendar, this is the best time to negotiate a new software agreement.
Don't neglect to strategize the timing of your license acquisition not only to meet your organization's timelines but also to maximize your NetSuite ROI. Timing is key!
NetSuite Cost Saving Tip #3: Contract Terms & Conditions
NetSuite software is 100% subscription based. Therefore when you license NetSuite, you are provided access to the software for a defined period of time. There are pros and cons with this arrangement. On the one hand, this frees up capital and provides maximum flexibility compared to the days of on-premise, perpetual software acquisitions. The flipside, however, is that ERP is very sticky and NetSuite knows this. It's not easy to pull the plug on one ERP vendor and switch to another overnight.
What does this have to do with saving on NetSuite cost related to licensing?
Most SaaS software vendors will entice new buyers with aggressive initial discounts with the intent of providing more perceived value than what is spent each year on software. Therefore as your perceived value increases so does your subscription amount. So each year you’re spending more on software than the previous year. There may come the point where the amount proposed for the new renewal period is at odds with your expectations.
So what do you do?
Switch vendors? Suck it up and pay the renewal fee? Spend countless hours on calls and emails with NetSuite management trying to strike a better deal? This all cost time and money!
What do the customers say:
A better alternative...
A Solution Provider partner can work with you to propose a longer-term contract with a fixed cost for the initial subscription term plus lock in equitable rate increases well beyond the initial term. By structuring your agreement this way, this eliminates any future surprises and frustrations. It’s a win-win for everyone involved.
NetSuite Cost Saving Tip #4: License as you go
One common mistake first time NetSuite buyers make is believing they need to license everything in advanced to get a better deal. The beauty of SaaS ERP software is that you can essentially turn on new features and users as you need them, on demand.
There might be a scenario where it makes sense to make a larger purchase in exchange for a concession but generally speaking, customers that acquire new licenses as they need them, tend to save more money on NetSuite licensing.
There have been numerous occasions where we've had conversations with new NetSuite clients that have purchased modules and services they simply did not need because they thought they were "getting a great deal".
Knowing what to license and when will have a substantial impact on your overall NetSuite cost.
Chapter 2: NetSuite Pricing Model
Unlike industry specific niche ERP systems, NetSuite is designed to support a multitude industries and business models, across all departments. The breadth of the platform creates a lot of licensing options designed to make the software affordable for starts ups as well as enterprise sized organizations. Whether your a small US based three person accounting team or a global one-hundred person sales and service team NetSuite has a solution and associated license package for you!
To start, NetSuite offers several CRM & ERP packages according to different types of industries, company sizes and modes of deployment. These industry packages include both the core NetSuite ERP offering as well as NetSuite add-on modules required for each industry.
For example, NetSuite contains prepackaged licensing suites for the following industries:
- NetSuite for Retailers
- NetSuite for Manufacturing Companies
- NetSuite for Wholesale Distribution Companies
- NetSuite for Ecommerce Companies
- NetSuite for Nonprofits
- NetSuite for Professional Services Companies
- NetSuite for Advertising Companies
- NetSuite for Software Companies
NetSuite Pricing : Company Size
Secondly, NetSuite offers these industry suites for various sized companies categorized as:
- Starter (select industries) - less than 15 users
- Emerging (select industries) - less than 30 users
- Limited Edition - Less than 10 users and under 50 employees
- Mid-Market Edition - Greater than 10 users and/or more than one legal entity
- Enterprise Edition - Greater than 1,000 users.
And to top it off, NetSuite offers separate license packages based upon deployment model: SuiteSuccess vs. traditional deployment method.
You can begin to see how it might get a little confusing with all these options!
NetSuite Pricing : Basic Packages
To make it simple let's take a look at the bare bones CRM and ERP licensing options NetSuite offers.
- NetSuite Limited Edition: is designed for companies with less than ten named users and supports only one legal entity.
- NetSuite Financials Mid-Market Edition - (ERP Only): Provides support for more than ten users and/or two or more legal entities. However CRM is not included with this package.
- NetSuite Mid-Market Edition: Provides support for more than ten users and/or two or more legal entities and includes both CRM and ERP.
Each of the NetSuite editions consists of the same underlying technology & code base and are deployed in NetSuite's multi-tenant public cloud within Oracle data centers. One of the major benefits of NetSuite is that as your company's needs grow you simply adjust your NetSuite subscription type, there's no need to perform a system migration and incur downtime. NetSuite is one of those rare ERP platforms that can work for a small business as well as an enterprise sized company. Therefore the investments you make in NetSuite today will carry with you in perpetuity.
Many NetSuite customers have requirements above and beyond the standard CRM and ERP features that come with the core platform. In light of this, NetSuite offers tons of add-on modules you can add to your license subscription based upon your particular business needs. The NetSuite add-on modules can be licensed à la carte as you need them and are also commonly packaged together in the form of an Industry Suite listed above.
Common NetSuite Add On Modules Include:
- Advanced Financials
- Fixed Assets
- Budgeting & Planning
- Revenue Recognition
- WIP & Routing
- Work Orders & Assemblies
- Warehouse Management (WMS)
- Demand Planning
- Project Management
- Resource Allocation
- Job Costing
- SuitePeople (HCM)
- SuiteCommerce (Ecommerce)
Similar to user licenses, the advanced modules may be subscribed to at any time during the length of your NetSuite subscription agreement and may be removed during your subscription renewal period. Having the flexibility to add and remove move modules as your business needs change is a huge advantage over traditional ERP software.
Chapter 3: NetSuite Price per User
When it comes to licensing SaaS software one of the biggest factors of your overall cost has to do with the number of user licenses you'll require. The more users you need, the more expensive your subscription agreement will be. Sounds logical right?
When it comes to licensing NetSuite users, NetSuite takes a named user approach instead of a concurrent model. Essentially, you'll need one license for each person that requires full access to the system, for complete auditability.
For specific roles with limited needs, it could make sense to have users share a common login but generally its a best practice to have a user license assigned to a single person.
There are a half dozen NetSuite user types, the most common being a full user license. A full user will have access to all areas of the application granted to them by their permissions and role-based security. A full user license is required for anyone that needs to transact in the system.
A second common user type is the Employee Self-Service license. These licenses are sold in packs of five for the price of one. Employee Self-Service licenses ideal for people who need to enter/ track time against a project, create/track expense reports and track and enter PTO. However, this is the extent of their usability within NetSuite
Then there are less common user types, which are necessary for customers that deploy specific advanced modules. Examples include Oracle NetSuite Planning & Budgeting Cloud Service Users and NetSuite OpenAir Users. We'll leave these out for now.
Lastly, some buyers inquire about read-only access; they want to provide their management team with access to reports and dashboards inside of NetSuite. You'll still need a full user license for this. With full user access, your management team will be able to drill in on reports and dashboards all the way down to transaction level detail. If static reports are sufficient, you can automate scheduled reports to go out based upon the desired frequency and output (e.g., Excel, CSV, PDF).
Keep in mind you only need a few user licenses to get started with a NetSuite. You can add new users at any time throughout your license agreement. You can also scale back the number of required users during your renewal period but not during the middle of your agreement. Therefore, you'll want to give some thought to the quantity and type of user licenses, so you don't over purchase.
Chapter 4: NetSuite E-commerce Cost
NetSuite SuiteCommerce has been around almost as long as NetSuite ERP & CRM, back then it was referred to as Site Builder. NetSuite Site Builder was developed way before the popularity of mobile shopping was even considered an option. While widely deployed with over two thousand customers it is severely lacking in today's mobile first world.
Therefore, about five years NetSuite made significant investments in the SuiteCommerce portfolio of products through both organic efforts as well as three key acquisitions; LightSpeed CMS, Retail Anywhere and Venda.
The outcome of these acquisitions and development efforts resulted in SuiteCommerce Standard, SuiteCommerce Advanced and SuiteCommerce InStore.
It's important to note that unlike other commonly deployed e-commerce solutions, NetSuite SuiteCommerce solutions are almost always used in conjunction with NetSuite ERP and CRM and not deployed as a stand-alone solution like Shopify or Magento. Therefore when you deploy SuiteCommerce there is no need for a connector or integration, its already natively part of NetSuite. This is one of the big advantages SuiteCommerce has over leading best of breed e-commerce platforms.
NetSuite Ecommerce Pricing & Product Overview:
SuiteCommerce Standard: SuiteCommerce Standard is a SaaS-based e-commerce solution that takes a templated, “Shopify” like approach to providing customers with a full-featured e-commerce site at an accelerated pace. In exchange for a streamlined, productized e-commerce offering NetSuite is able to push out new features as quickly as they become available. SuiteCommerce Standard is a great fit for companies that have simplistic needs and desire to be live on an e-commerce platform in short order.
SuiteCommerce Advanced: SuiteCommerce Advanced provides customers with an enterprise-grade e-commerce platform in which you can completely customize all aspects of your e-commerce shopping experience. With unlimited design flexibility, you can run both B2B and B2C lines of business through a single platform offering customers faceted search, robust site search, dynamic merchandising, advanced pricing & promotions capabilities all on a mobile optimized platform. SuiteCommerce Advanced is best suited for companies that sell high volumes and require complete customization around the look and feel of the shopping experience
SuiteCommerce InStore: SuiteCommerce InStore is a mobile Point of Sale (POS) solution built on the SuiteCommerce platform. Its aim is to provide customers with a seamless digital and physical shopping experience complete with customer and inventory info at your fingertips. SuiteCommerce InStore leverages commoditized hardware delivered in the cloud designed to enable associates mobile freedom while servicing customers.
While all NetSuite Partners can technically sell SuiteCommerce products not all partners are able to implement them. When considering SuiteCommerce solutions its important to partner with a Commerce Agency Partner (CAP) only they can truly help you design and deploy a SuiteCommerce solution.
Chapter 5: NetSuite Pricing Summary
How can you be sure your getting the most value from your NetSuite license subscription?
By partnering with an organization that has helped hundreds of companies license NetSuite, just like yours!
Remember you don't have to go through the evaluation process alone and without representation, you can let the licensing experts at Techfino help you navigate this critical purchase.
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