What is a SAP ERP system?
An SAP ERP system is business software from SAP that integrates purchasing, inventory, production, sales, and finance into a single database. SAP offers several packages for this purpose, ranging from S/4HANA for large enterprises to SAP Business One for small and medium-sized businesses. Which package is right for you depends primarily on the size and complexity of your business.
Below is an overview of the available SAP ERP systems, how they differ from one another, and the types of companies they are designed for.
Explained
The Difference Between SAP and ERP
SAP and ERP are often used interchangeably, even though they are two different things. ERP stands for enterprise resource planning and is the collective term for software that brings all business processes together in a single, centralized environment.
SAP is the vendor. The German software company has been developing these types of systems since 1972 and is the world’s largest provider of its kind.
So, anyone looking for an SAP ERP system isn’t choosing just one product, but rather from a handful of packages that differ significantly from one another—in price, implementation time, and, above all, the type of organization they’re designed for.
What SAP ERP systems are available?
Three packages are the most common in the Netherlands. They share the same philosophy, but they’re designed for very different types of businesses.
| Software | For whom | Guidelines on Scope | What It’s All About |
|---|---|---|---|
| SAP S/4HANA | Large, often international organizations with complex processes | Starting with a few hundred employees | On-premise or private cloud |
| SAP Business One | Wholesalers and manufacturers in the SME+ sector | Approximately 10 to 250 employees | On-premises or in the cloud |
| SAP S/4HANA Cloud Public Edition | Mid-sized companies that want to follow the standard | Medium-sized, growing toward enterprise level | Public cloud only |
SAP Business ByDesign was also among these options for many years. That package is no longer sold to new customers, so anyone shopping around now will, in practice, end up choosing one of the three listed above.
In Practice
What an SAP ERP System Does in Practice
Choice
Which package is intended for which type of business?
The question is rarely which SAP package is the best, but rather which package fits the way a company operates. That difference is significant enough to warrant some consideration.
SAP S/4HANA is built for scale and complexity. Think of organizations with multiple operating companies, branches in different countries, and processes that vary by country. This comes with an implementation that can easily take years, followed by a team that continues to manage the system afterward.
SAP Business One is designed for SMBs and larger businesses and comes standard with everything a wholesaler or manufacturer needs: finance, purchasing, inventory, sales, production, and reporting. The package can be expanded with modules, but the starting point is a fully functional system that can be up and running in months rather than years.
SAP S/4HANA Cloud Public Edition, also known as Grow with SAP, falls somewhere in between. It runs exclusively in the public cloud and follows the SAP standard. This makes implementation fast and predictable, as long as a company is willing to align its processes with that standard.
If you’re torn between two packages, the best thing you can do is start by mapping out your own processes on paper. The step-by-step guide to choosing an ERP package explains what such a comparison looks like.
Business One
When is SAP Business One the right choice?
For wholesalers and manufacturers in the process industry, SAP Business One is often the go-to choice in practice. Not because it’s the largest solution, but because it covers the full scope of such a business without the lead time associated with an enterprise implementation.
Batch registration, shelf life, recipes, quality control, and traceability are all part of it. These are precisely the areas where a general-purpose ERP package usually requires customization.
A system is only effective if it adapts to your existing workflows, rather than the other way around.
Logres has been implementing SAP Business One for over 30 years and is an SAP Business One Premier Partner. The page about SAP Business One lists the modules, pricing, and experiences of companies that are already using it.
Need advice?
Our experienced consultants will be happy to explain how the SAP ERP system could work for your business.
FAQ
Frequently Asked Questions About SAP ERP Systems
Is SAP an ERP system?
SAP is not an ERP system but rather the vendor that provides it. The German company offers several ERP systems, each tailored to a different type of organization.
For large and complex organizations, that’s SAP S/4HANA, available on-premises and in the private cloud. For SMB+ companies, the solution is SAP Business One, an all-in-one system that can run both on-premises and in the cloud. In between is SAP S/4HANA Cloud Public Edition, also known as Grow with SAP, for midsize companies that want to follow the SAP standard.
SAP Business ByDesign was also part of that lineup for many years, but is no longer sold to new customers.
What is the difference between SAP Business One and SAP S/4HANA?
Both are full-fledged ERP systems from SAP, but they are designed for different sizes of businesses. S/4HANA is designed for large organizations with complex, often international processes, and its implementation takes several years.
SAP Business One covers the same range of processes for SMBs and beyond, with an implementation timeline measured in months and a corresponding investment. A comprehensive comparison of the SAP packages can be found in this article about the transition to S/4HANA.
Is an SAP ERP system suitable for small and medium-sized businesses?
Absolutely. SAP Business One is designed specifically for SMBs and SMB+ companies and includes, as standard, the modules that wholesalers and manufacturers use every day.
If a process deviates from the standard, the package can be supplemented with additional modules. A consultation is usually the quickest way to determine what is needed.
How much does an SAP ERP system cost?
That depends on the package and the number of users. With SAP Business One, billing is per user, with a distinction between a Professional User and a Limited User, and it also depends on whether the system runs on-premises or in the cloud.
The current prices are listed on the SAP Business One page. In addition, there are costs for installation and implementation, which depend on the number of consulting days required.
Can an SAP ERP system be integrated with other systems?
That’s possible. For many systems, there are ready-made integrations in the Integration Framework, and new integrations can be built via the API.
Often, an integration isn’t even necessary. There are so many add-on modules that it’s often easier to replace existing software with a module within the same system. The data is then available everywhere in real time, without the need for any intermediary software.
Is an SAP ERP system scalable?
Yes, although the ease of implementation varies by package. SAP Business One excels in this area: modules can be added without compromising updates, and thanks to support for multiple languages and currencies, the system scales with new locations and countries.