When planning to implement a custom ERP solution for your business, you would always wonder how much would it cost me. Let’s understand and figure out a ballpark estimate that you should plan for your custom ERP software for your business.
What is your core objective?
You want to find out the budget required for custom ERP solution implementation for your business. You would also like to consider the savings on operational cost and any increase in revenue that could result with the ERP. You want to make a decision accordingly.
Common problems faced by business owners on this path:
- No clear cost available from any vendor. Every vendor says the same thing : “It Depends on the size and operations of your business”.
- Pre-built packages available in the market do not fit your business model, they require you to make a lot of changes to your methods of business operations.
- You’re not sure which solution should you invest your time and energy in, there is no visible comparison as everyone points to a different kind of solution.
You can easily calculate a ballpark figure by considering some key points:
- Divide your business process for which you want to build the ERP into departments and modules. A module is supposed to be the set of functions performed by every type of user using the software. Further define what functions each user would require.
- Classify each function into three categories:
- Form(s) in which your user would put in some values / information.
- Screen(s) to view information.
- Reports with filters.
Document all the above facts for cost calculation.
- Repeat point (2) for each module and each department. You don’t have to get into much details, just define what fields matter the most. This will help you build the most important parts of the menu.
Let’s get to some numbers:
- Here’s the average cost calculation (Design + Frontend + Backend + Unit Testing):
- Each form that takes values would require around 8 – 10 hours to build. If a form has dynamic values or functions, it may take 2-2.5 times the standard estimate.
- Every screen to view information would require around 6-8 hours to build.
- Each report with respective filters can take around 10-12 hours to build.
- Add time for Functional testing as 30% of the total of above estimate. Take the total so far and add 30% more for Project management and technical architects as they provide the direction to the team to ensure your software’s success.
- Roughly choose a tech-stack, just to identify the category of tech-stack you’ll need. If you have massive data/transactions and/or would have many users using the software simultaneously, and you need it to work superfast, choose a microservices framework like NodeJs + ReactJs. It can handle any volume of data, as long as you’re willing to maintain a high-end server for the same. If your usage is light or you’re okay with the pages take around 1 second to load, but you wish to save a bit on the cost, you can go with PHP based frameworks such as Laravel.
Cost Calculation: A Laravel based development would cost you around $35/hr and would take lesser time, whereas a microservices framework would cost you around $45/hr and would take more time. Overall there is a difference of around 30% in overall project cost between the two tech-stacks. It’s important that you choose microservices framework beforehand if you plan to go big at present or in short term itself, a regular PHP based framework wouldn’t be capable to take up that much load and you would need to start from scratch.
Sample Use Case:
A Manufacturing hub with 5 parts in production process with single product, including 2 forms and 2 viewable screens for each part (one user per part) would require around 180 hours for process flow = approx $7,500
add: 1 admin module with 3 view screens and 3 reports = approx $2,500
add: 30% Testing = $3,000
add: 30% Management and Architecture = $4,000
Total: $17,000
Sounds Fair? Build your custom ERP now to support your business.
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What you’ll get:
- A thorough Business Evaluation (Business Analysis) to assist you in documenting the departments, modules and screens involved.
- A transparent cost structure.
- An Agile based incremental delivery plan.
Start developing your ERP software to upscale your business.
The fact that you feel the need of implementing a custom ERP is a sign that your business needs it now. Save yourself from the vicious circle of Analysis-Paralysis. Get the attention and consultation your business deserves. Act Now!