Subscription over three years
Not year one. Model expected headcount growth, module additions, and annual uplift. Year three commonly runs 30–50% above year one for the same business.
Buyer guide
Most ERP business cases compare one vendor's licence to another's. That comparison omits roughly 38% of the actual three-year cost, and it omits the same proportion from both sides — which feels fair and quietly changes the ranking.
Send your candidate quotes and your requirements. We will build the three-year comparison.
Buyer guide
A vendor proposal typically contains two. The other six are where business cases are wrong, and they are all estimable in advance.
Not year one. Model expected headcount growth, module additions, and annual uplift. Year three commonly runs 30–50% above year one for the same business.
Median 1.4× first-year licence, plus a median +27% variance to original quote. Budget the variance rather than hoping to be the exception.
Per connected system, plus ongoing maintenance. Count your systems honestly — most companies name five and run eleven.
400–1,200 hours at loaded cost. Usually the largest single line and present in no vendor proposal, because no vendor can invoice for it.
Your existing licence continues during the parallel period, which for a proper migration is several months. Frequently forgotten entirely.
Direct training cost plus the weeks where your finance team is slower than before. Real, awkward to estimate, and better estimated badly than omitted.
Somebody maintains the configuration, the permissions, and the reports. That is a fraction of a role, permanently.
Export capability, data portability, and what a future migration would cost. Rarely modelled and directly affected by which product you choose.
Vendor quotes are built around year one because that is when the discount lives. Year two has no implementation cost and a full year of subscription; year three adds seat growth and uplift.
The ranking between candidates frequently changes between a one-year and a three-year view, particularly between per-seat and resource-based pricing models. A product that looks expensive in year one because implementation is included can be materially cheaper by year three.
The most useful column in a TCO is the one for changing nothing. Current software licences plus the people doing work software could do — that second figure is typically four to ten times the first.
Including it does two things. It shows whether any option is actually better than the status quo, and it reframes the decision from a purchase to a reallocation. The question stops being whether the new system costs more than the old one and becomes whether software plus people goes down.
Be honest in the model about this. Automation returns hours; it does not automatically return money. If your team redeploys those hours into analysis, forecasting, and business partnering — which is what usually happens and is usually the right call — the benefit is capacity rather than cost reduction.
A business case built on headcount reduction that nobody intends to make is a business case that will not survive its first review. Model capacity, say so, and let the decision-maker weigh it.
Every figure behind our TCO tool is stated on the same page — seat costs, implementation multiples, entity fees, and the $96,000 loaded cost per finance person. A calculator that hides its maths is a lead form with a slider. Where our assumptions do not match your situation, change them; where they favour us, say so and we will look at it.
Questions
The ranking changes, and sometimes staying where you are turns out to be the cheapest option.