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THE PROBLEMS WITH “FREE” ERP SOFTWARE
It should come as no surprise that “free ERP” is one of the top online search queries relating to ERP software. I mean, who doesn’t like free stuff? Compared to the substantial investment of commercial ERP, a free download seems like a no-brainer, right? Well, I for one wouldn’t click that “Download” button quite yet.
In the ERP software industry, a problem can arise when a company falls for a “free” ERP gambit without first determining the true total cost of ownership and possible consequences. For example, while there are free downloads of ERP software online, very few, if any, come completely free. Once support services, customizations, and upgrades are taken into account, the cost of that free download could be thousands, or even tens of thousands, of dollars.
The process for selecting free ERP software should be the same as selecting commercial ERP software. You first need to evaluate your needs and your budget, and then compare different software to find the best match. The mistake many companies make when they select free ERP is they don’t anticipate the high cost of support and maintenance. A free ERP download is usually just that – a free download – once downloaded, you’re on your own. If you take this route, you are going to need an IT staff that is experienced in implementing and maintaining business software.
Most commercial ERP software companies offer a range of support packages based on each company’s needs. Free ERP offers may come with the option to purchase support, but some just leave you to fend for yourself. Most of these companies rely on customers needing their support services to make money, so it is unlikely that their software will be very user friendly. They are also very basic systems with little functionality, so be sure to factor in the cost of customizations.
Another disadvantage of free ERP software is that it may not integrate well with your current applications, such as Microsoft Office. The time spent transferring all of your business data to these applications each period can be significant. Not to mention, there is room for human error during a manual transfer, which can end up costing the company a great deal.
The high cost of “free” ERP can also be attributed to the cost of upgrading the software. When these companies release new versions of their software, they can render previous versions obsolete, forcing customers to pay for the upgrade.
Furthermore, since the developers of the software have no financial or legal obligation to maintain it, if something goes terribly wrong, such as a bug in the software, all you can do is pray that they fix it. The same goes for the developer’s obligation to protect your confidential business data, which puts the security of your company’s data at risk.
In conclusion, you should only consider a “free” ERP download as a temporary trial to test out before investing in a more robust system; don’t expect it to be a viable long-term solution. If the cost of ERP software still has you leaning toward a free download, rather than simply comparing the initial startup costs, you should consider the total cost of ownership—from implementation to maintenance—and you’ll realize there is no such thing as free ERP.