Crm System Cost

Topics: Customer relationship management, Customer service, Support automation Pages: 7 (1589 words) Published: December 20, 2010
How much does a CRM system cost?
As Customer Relationship Management systems move from being “nice to haves” to essential tools in keeping businesses competitive, their implementation is growing at a rate to match. And of course, price and cost play a vital role. However, the price of a CRM system is more than just the cost of the software and IT.

So how do you find out how much a Customer Relationship Management (CRM) system will cost? When budgeting for a project, making a business case for CRM, assessing quotes from a solutions provider, or just trying to get a realistic idea of how much you'll need to spend, here's a guide to some of the key factors you need to consider.

Once you've clearly defined your business requirements, CRM projects can be broken down into three main areas of costs:

1) CRM Software Costs

The price of CRM software usually consists of:
• the price of software licences

• the price of software maintenance.

2) Professional Service Costs

Professional services refer to what you need to get done to get your CRM system up and running. They can include the costs of everything from scoping the project to software configuration, hardware and training. They include internal costs (such as the time of your own staff) as well as the price charged by your CRM solutions provider.

3) Support Costs

Support costs generally refer to the price of assistance to keep the system going. They will usually include the costs of technical support, administrator support and user support, such as access to a help desk. Sometimes support costs include CRM software maintenance costs: it depends on wording and the vendor.

Building a CRM system from scratch?

These three categories of costs assume, like the vast majority of businesses that implement CRM systems, that you work with a solutions provider or business partner. If you decide to build or implement a system yourself, you'll need to include several other factors in the price. Probably the most significant costs will be developing or acquiring the wide mix of business, administration, management and technical skills. Do not underestimate how important these skills are to a successful CRM project. And if you go down this route, you're well, quite literally, on your own.

So, assuming you intend to employ the help of a solutions provider, here's a look at each of the three main areas of project costs in more detail:

The Price of CRM Software

Working out the price of CRM software licences is usually straightforward. There will be a price for a single user licence, number of users or multiple user licences. Remember to allow for expansion with the number of software licences you buy: the number of users can quickly grow as the benefits of using it become apparent. It can also be useful to have extra licences on hand ready for new staff.

When buying CRM software there's sometimes the choice between named or concurrent licences: most businesses prefer concurrent. Note some CRM software vendors only supply software licences in batch quantities, so you may have to buy 5, 10 or 15 etc.

Maintenance costs are to cover when the software manufacturers update, alter or modify the product to correct faults, improve its performance or adapt it to work under new conditions. This is usually charged as a separate line item per software licence, as a set annual fee (a bit like insurance). Some resellers make maintenance charges compulsory – meaning you can't buy licences without maintenance. If it's not a separate item check it is included in the licence or support price. Don't buy CRM software without maintenance.

The Price of Professional Services

Here's where working out the cost of a CRM project starts getting more involved. Unlike software licences, which have a clearly identifiable unit price, professional service costs are not directly user-based. What's more, professional services costs in CRM projects can be the largest expense –...
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