SAP channelizes Business One

More than a year after the product was launched, SAP has finally announced its first Business One customer in Canada.

Mini-Tankers is a Vancouver-based company that provides on-site diesel refueling services. It has begun rolling out the ERP solution for small to medium-size businesses, beginning

with financials.

First presented in the spring of 2002 at SAP’s annual user conference, Sapphire, Business One is targeted at companies with 10 to 150 employees or revenues as low as $1 million. At the time of launch, SAP president Hasso Plattner said the software was for SMBs or the remote offices of large companies that would not typically have access to information held in a central location.

Mini-Tankers has 120 employees and more than 4,000 customers across Canada, and projected revenue of $70 million this year.

The company has experienced rapid growth in the last few years, and expects to pump 130 million litres of fuel this year (compared to 1.8 million litres a year in 1995). The company processes more than one million transactions on its sales side annually.

“”The mix of clients we have include those with one piece of equipment requiring 200 litres every month versus clients that have over 300 pieces of equipment in their fleet,”” said Joe Valeriote, vice-president of business development at Mini-Tankers.

Last year, the company’s growth spurt and the multitude of transactions the company processes prompted company CFO George Murray to reconsider the company’s business process systems.

The SAP Business One software for Mini-Tankers’ financial systems should be in place by the first quarter of 2004, says Murray. The product offers ERP on a smaller scale, including SFA, financial management with multi-currency functions, budgeting, inventory management and a reporting module that allows access to all data.

“”What we were finding is our existing technologies were having difficulties keeping up with the pace of the growth and we didn’t have an integrated platform,”” said Murray. “”We were looking for something that could integrate all our business processes onto a common platform and provide for long-term scalability. Initially we looked at Great Plains as an entry, but SAP changed our strategy. We were really impressed with the ability to integrate with third-party external users,”” he said.

SAP acquired Business One a year and a half ago from Israeli company Top Manage Financial Solutions.

“”Before we had Business One, there was no way a company of $10 million could think of becoming an SAP customer. So the plan was to design a new product to go after market with a product made specifically for their needs,”” said Michel Vincent, vice-president of SMP for SAP Canada.

SAP Business One has 1,600 customers worldwide. Vincent said SAP has taken its time making sure features in the software that are unique to the countries in the “”second wave of the rollout”” — such as Canada, France, Spain and Italy — are all in place.

“”We needed to localize the product. Each country has its own requirements and we have to follow the tax requirements, accounting rules and all of this. Instead of launching a product that doesn’t fit anywhere, the company decided to invest in localizing the product,”” said Vincent.

“”SAP is very careful when we launch a product that it works. We’re not the kind of wheeler-dealer who goes out with a product and it’s not tested and the functionality isn’t there. When we go to market it’s because we have something we can sell that can work right now.””

However, analysts suggest it was also because the vendor needed to establish the proper channel partners — something SAP has not had to rely on in the past as it sells directly to its large enterprise customers.

“”SAP had some reservations about quickly rolling out Business One because they are so strong in the really big enterprise accounts, but not SMB. In the past they have never focused on building out the infrastructure in terms of channel to reach the customers below those really big enterprise-class customers,”” said Warren Shiau, software analyst for IDC Canada Ltd. “”They (customers) need some sort of point of contact for service and implementation.””

Vincent agreed SAP did need some time to set up a channel of resellers to handle the Business One product with national coverage.

“”Selling to companies of that size is new for us, so we need partners that have the experience of working with that kind of customer, that understand their needs, speak their language and understand their pain. We needed the complimentary expertise of the people well-rooted in the SMB space,”” he said.

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