Procurement Software Cost Calculator
Are you trying to figure out whether you should purchase a traditional on-premise procurement system or go with a newer, on-demand (SaaS) procurement system? Use this calculator to help understand the true total cost of ownership for both models. We think you’ll find on-demand procurement software can reduce both your up-front costs and your 5-year costs all while reducing project risk and speeding time-to-benefit.
Calculate On-Premise Procurement Software Cost
Use this calculator to compute the total cost of on-premise procurement software for your organization over a 5 year period.
Learn More About On-Premise Software Cost Components
Calculate On-Demand Procurement Software Cost
Use this calculator to compute the total cost of on-demand procurement software for your organization over a 5 year period. You will see on-demand software has none of the hidden costs of on-premise software and often results in dramatically lower cost. (NOTE: the default values below are for illustrative purposes only. Please contact your Coupa Savings Agent for a subscription quote).
Learn More About On-Demand Software Cost Components
Review Potential Cost Savings With On-Demand Procurement
Using the above calculations, you can save with on-demand procurement software over a 5-year period, compared with on-premise procurement software. Of course, true savings may be even higher as this analysis does not include the time value of money or NPV computations.
On-Demand Software Cost Components
With on-demand procurement software, you have far fewer cost components than on-premise software. There is no hardware or software to buy and install. There is no implementation project to manage. There is no internal system support required. Instead, there are only two costs – subscription cost and training cost.
Subscription Cost
This is the annual cost to subscribe to the on-demand software.
Training Cost
This is the cost to train your “end users” on using the procurement software.
On-Premise Software Cost Components
With on-premise software, you have quite a few cost components to compute. There is hardware and software to buy and install. There is an implementation project to manage. There is internal system support to keep the system up-and-running. Here we define each of the cost components.
License Cost
This is the cost to buy perpetual usage rights to the software.
Support Cost
This is the cost for support of the software you’ve purchased. It is typically 20% of the license cost.
Upgrade Cost
This is the cost to buy a new “major” version of on-premise software. Most providers release major versions of their software every two to three years, and if you don’t upgrade within a certain timeframe, you may lose critical aspects of support. Upgrade license costs are typically 25% to 75% of the initial license cost.
Server Cost
This is the cost to purchase and install test and production computer equipment for running on-premise software. Remember to account for upgrading computer equipment, typically once every 3 years.
Database Cost
This is the cost to purchase and install a relational database required to run your on-premise software. The database will be used to keep a historical record of your purchasing transactions. Like the on-premise procurement software, the onpremise database software requires a license cost and an ongoing annual support
cost.
Application Server Cost
This is the cost to purchase and install the software required to run your on-premise procurement application – software like Microsoft IIS or Oracle Application Server. The application server, like the database, requires a license cost and an ongoing annual support cost.
Implementation Cost
This is the cost to install, configure, and customize the on-premise software. It is a one-time set-up cost. Often internal project resources combine efforts with a third party implementation firm to do get the on-premise software up and running. A “small” on-premise implementation typically runs 25-50 thousand dollars, a “midsize” implementation around 100 thousand dollars plus, and a “large,” enterpriseclass implementations can cost a million dollars or more.
Often implementation cost is quoted at an hourly or daily rate with a total “estimated” but not committed. Beware of this structure as the services vendor has little incentive to complete the implementation quickly or efficiently.
Internal Support Cost
This is the total burdened cost for internal resources required to operate and maintain the on-premise software. Typically these resources can be classified into three categories: administrative, quality assurance, and support/operations. If you have a large IT organization with many on-premise applications you can share or split resources. These resources must handle “end user” support, perform regular maintenance of the on-premise software, and continually test any changes needed before they are made to the production system.
Training Cost
This is the cost to train your “end users” on using the procurement software, and train your IT and administrative users on running, managing, and maintaining the on-premise software.
Training is required upon initial installation, and then again with every major upgrade. Costs will vary depending on system complexity and team size.
Company Blog
Developer Blog
News & Events
