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Selecting an ERP System for SaaS Companies - What You Need to Consider

05/17/2018

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Obviously, the goal of any SaaS organization is to run a successful, profitable business. But having a great service is only half the battle…it’s equally important to implement systems that maximize efficiency.  And SaaS companies face even more challenges, as they construct their metrics reports with data pulled from disparate applications, and then aggregate that information and perform calculation within spreadsheets.

SaaS companies usually track several financial AND non-financial operating metrics. A successful SaaS business generally experiences high growth and continually adds and keeps subscribers, which is a process that is not easily shown in your point-in-time metrics.

There are many moving pieces within the SaaS model: recurring revenues, subscriber numbers, growth rates, revenue per customer, the cost of acquiring new customers, the cost of maintaining existing customers, and the cost of a scalable hosting platform. With figures changing constantly, legacy systems simply cannot keep up, resulting in inefficient and manually intensive remedies that are not sustainable.

When considering an ERP system, it’s all about the metrics

The most important metrics to track right from the start of a SaaS business are revenue and customer cost. With an ERP system such as Sage Intacct, it’s easy to obtain these metrics, when and how it’s needed.  Having this information available enables organization leaders to make quicker, more sound decisions that go beyond GAAP metrics. And having this information available via dashboard as performance cards, reports, charts, and graphs makes it even easier for them to spot trends, compare to benchmarks and drill down into source data.

Other metrics can include:

  • Committed Monthly Recurring Revenue, or CMRR
  • Annual or Monthly Recurring Revenue, or ARR/MRR
  • Customer Acquisition Cost, or CAC
  • Churn
  • Customer Lifetime Value, or CLTV

In order to support quick decision making, these metrics need to be accessible quickly and easily.  With Sage Intacct, these metrics are available real-time, and are always accurate, driven by data gleaned from your organizations’ CRM system and Intacct.

Deep Dive with Dimensions

It’s difficult to drive a business that has many fast-moving, interrelated financial elements, and it is necessary for a SaaS’s ERP system to accommodate these pieces.  Sage Intacct provides unmatched analytical depth from within the financial system of record, providing complete, real-time metrics that can be easily dissected by key business drivers.

Sage Intacct dimensions can be used to analyze SaaS metrics by important attributes: project, customer, location, department, vendor, item, employee, and class.  Business can be further optimized by tracking different kinds of SaaS revenues – Newly acquired customers, purchase upgrades and add-ons, churn and renewals, by spotting key trends and issues via the dashboard.

What SaaS organizations need to consider when selecting an ERP

In order to remain efficient, SaaS organizations need to consider the following elements when selecting an ERP system: automation, flexibility and CRM integration. Sage Intacct eliminates manual calculations and one-size-fits-all metrics, saving time, reducing errors and boosting efficiency. Your organization will no longer need scripting or add-ons to create unique SaaS metrics based on your custom definitions, chart of accounts, and unique business needs.

Are you the leader of a SaaS organization looking to eliminate manual efforts and reduce inaccuracies through automation?  Contact us today on how Sage Intacct can help.

Tagged with: ERP, SaaS, Sage Intacct