The cost of inventory management software will depend on several different factors including the number of users, cloud vs. on-premises implementation, advanced feature requirements (such as lot tracking and landed cost tracking), training, data migration and more.
As mentioned in my previous post, I was recently interviewed by Alexandra Tambellini of Capterra. Her now published post – Know Thy Warehouse – very nicely sums up some key considerations that many people neglect before starting the look into new or improved wholesale distribution software.
As a corollary, I should point out that you also need to be realistic and pragmatic in what is, in fact, achievable within your budget. Which brings us to a crunch question: how do you determine your budget? I find that many companies seem to start off with an arbitrary budget, based on what they feel they should spend – without using any real-world frame of reference. Such companies sometimes end up spending, say, $20,000 on a system that doesn’t really work for them, because that was their budget based on a preconceived notion; whereas a $40,000 system would have provided a terrific solution and a springboard to growth and profitability.
An important factor to keep in mind when setting a budget for new software is whether or not your business can benefit from an introductory based system (such as Fishbowl) or a full inventory and accounting ERP solution. Not only will each type of system significantly vary in cost, but also functionality. Before you can set a realistic budget, you need to have an understanding of your needs.
I’ll be examining this over the next few weeks on this blog, but first you tell me your opinion:
How do you determine what your budget should be?