Market Impact of Joint Effort
March, Best Software, Inc., one of the leading
current providers of integrated accounting, business management, human resources
(HR)/payroll and fixed asset solutions for small and mid-sized companies in
North America, announced that its parent company, UK-based The Sage
Group plc (LSE: SGE.L), had completed the acquisition of ACCPAC
International, Inc. (www.accpac.com).
The Sage Group plc (LSE:SGE.L)one of the leading providers of business management
software for mid-sized companies worldwide, with annual sales of nearly $900
million (USD) and 3.6 million customers worldwide in fiscal 2003. ACCPAC International,
Inc. (was, until recently, an independent subsidiary of the software powerhouse
Computer Associates International, Inc. (NYSE: CA).
"Freedom of choice" and "openness" mantras have been professed independently by both Best and ACCPAC, which bodes well for the joint effort going forward, but ACCPAC also brings many other missing parts to the Sage/Best collection. Like its former competitors and now partner and sibling companies, ACCPAC has long made a conscious decision to go for product distribution solely through partners or value added resellers (VARs). This has often proven to be advantageous to small and medium enterprise's (SME) for keeping costs down, and, as selling through partners requires a higher quality of product support, and accompanying documentation. Moreover, direct and indirect channels that have already been built in targeted countries has helped the company with product translation and localization issues, which has resulted in the solid multinational capabilities of the product.
company has become an undisputed leader in Canadian, South African, and ASEAN
(South East Asia) accounting markets, with high positions in many other established
and emerging markets.Regarding the Advantage Series product,
the VAR channel is truly global, since international companies can easily find
ACCPAC VARs capable of supporting their needs across multiple countries, contrary
to most competitors (including Sage, Best, and Softline) whose
channels have expertise that typically focus on specific products by local region
and offer limited cross product support. Best Software, in particular, has never
had a product that satisfied core accounting in Canada and internationally,
let alone for specific regional requirements for places like in India. Excise
for manufacturing, sales tax, payroll, or fixed assets with two depreciating
rates applied for each asset—in terms if Indian Companies Act and Income Tax
Act, are regional requirements which ACCPAC will manage with ease.
targets SMEs with up to $250 million (USD) in annual revenues and with up to
1,000 employees that are in need of enterprise application solutions that are
intuitive and, consequently, easy to use and implement. The company has often
met this market's requirements of competitive and scalable priced, functional
products, ease of modification, relatively short implementations, and dependable
service and support. The modules can be implemented in a gradual fashion to
tackle the most burning issues first. While at the enterprise products level,
functionally, there has been an ever-diminishing difference from one general
ledger (GL) or accounts payable (AP) product to another, ACCPAC
might have still be leading the pack in delivering multicurrency and multinational
and inter- and intra-company consolidation capabilities and in built-in financial
report writers that provides flexible query and report creation without programming.
is Part Five of an eight-part note.
One, Two, and Three presented the event summary.
Four to Part Six will discuss the market impact.
Seven will cover challenges and Part Eight will make user recommendations.
Positioning for SMEs
mentioned earlier, in addition to its SOHO (small office home office) offering
called Simply Accounting, ACCPAC offers two flagship core accounting
product suites, both being a foundation to its more complete set of the above-mentioned
newly released enterprise applications beyond core ERP scope. Its chief original
product would be the ACCPAC Advantage Series, formerly ACCPAC for Windows,
whereas the ACCPAC Pro Series is the product suite formerly
provided by Software Business Technologies (SBT),
which ACCPAC acquired in 2000. Given the product had been branded as Pro Series
even while with SBT, ACCPAC has retained that brand name, and has thereby likely
gained an additional visibility in a market catering to light manufacturing
and warehousing companies. This should be further boosted by the new ACCPAC
WMS radio frequency-based (RF) warehouse management product that also
integrates a wireless bar code reader and web-based, remote management to streamline
the picking, packing, and shipping process. As mentioned earlier, the vendor
has also added to its offering the suite of manufacturing products originally
developed by Lahey Software to integrate with Pro Series.
Advantage Series and Pro Series are positioned for the small to mid-size enterprises.
One of the key differences in the products' positioning lies in source code
access. The Pro Series has always provided full source code availability for
code modification throughout the suite. To that end, complete Microsoft
Visual FoxPro source code allows professional programmers to make unlimited
extensions and enhancements to address unique business-specific needs or interfaces.
The above provision of source code might be attractive particularly against
the background of ever increasing market awareness of the following facts:
almost every business changes, and software must change with the business,
that even small businesses are really unique—one size can never fit all, and
custom software is a requirement for many enterprises, even for the smaller
the Advantage Series does not provide source code per se, it offers many entry
points for other applications to integrate, even to the degree that core business
logic is accessible and can be leveraged by the third party product. Furthermore,
Advantage Series is web-based, simple object access protocol (SOAP) compliant,
fully accessible without intermediate web-enabling technology such as Citrix
MetaFrame or Microsoft Terminal Server (MTS),
while the Pro Series is not yet web-based. Transaction data and other processes
can now be performed using an Internet browser via the company intranet or the
Internet. Several extended-ERP applications, including ACCPAC CRM
and eTransact Web store module bring additional wireless and
web-based functionality to the module suite. Advantage Series also has much
stronger international features in terms of languages, taxation support, and
currency handling than its Pro Series counterpart. Still, both product suites
can be built upon to form a full suite of integrated web-based business applications.
To that end, accounting, HR, CRM, POS, and WMS are tightly integrated with Advantage
Series, while the manufacturing functionality is tightly integrated and available
through selected third party products (such as MISys, COSS
Systems, and EMR Innovations' ProcessPro 2K3 product).
With Pro Series, however, accounting, CRM, manufacturing, and WMS are tightly
integrated, while the HR integration is still in progress.
ACCPAC applications are geared for growth since virtually all the major product
lines are tiered into graded editions that share the same design and technology
despite differing levels of functionality. They are aimed at enabling customers
to select a product with features at a price point, that best suits their current
needs. As the company grows, it should then move up to more advanced functionality
without re-learning software or rebuilding databases. Although its competitors
(and current parents as well) also offer scalability and migration options to
more advanced functionality at the later stage, most of them still offer it
through more disparate products leveraging disparate technologies, which often
have to be relearned from scratch. Consequently, often the migration is not
much easier than an implementation anew. Conversely, ACCPAC editions within
a product suite (i.e. Advantage Series or eCRM) share similar
functionality and screens, but differ in terms of the maximum number of supported
users and related pricing.
Best Target Companies
Software also offers multiple flavors of SME systems to accommodate varying
needs across the range of company sizes and industries with an attempt of clearer
delineation and less internal competition between the products. These start
with low-cost "desktop" solutions like Peachtree and ACT!,
and are both sold primarily through retailers as well, like Microsoft
Office. While nobody will dispute Microsoft's brand equity, Best could
find its consumer product equivalent in ACT!, which has long been loved by the
salespeople who use it. Furthermore, Best, ACCPAC and Intuit,
owing to their respective Peachtree, Simply Accounting, and
QuickBooks entry-level accounting products, benefit from huge migration feeder
bases, and are thus able to "cut the air supply" for the likes of MBS, Exact,
or SAP. However, of these three, Best has achieved the largest
success at the upper level of the market, where Intuit, although with over 80
percent market share in retail SOHO accounting products has only been making
nascent strides in the enterprise space and in the equivalent channel ramp-up.
MAS 90 is targeted at mid-sized companies with 10 to 500 employees, and features
more than 25 accounting, light manufacturing, distribution, e-commerce, BI,
payroll, CRM, SFA, and financial reporting modules. Very readily recommended
by CPAs, in addition to basic business management, MAS 90 offers industry-specific
functionality for manufacturers and distributors, such as inventory management,
bill of materials and job costing. The product might be ideal for small businesses
who have outgrown an off-the-shelf application such as Peachtree Accounting,
and there is a clear migration path available for customers who are ready to
make that transition. MAS 200, the client/server version of MAS 90, handles
higher transaction volumes, and supports multiple databases, including Microsoft
SQL Server. Smaller companies with up to fifty employees are covered
by BusinessWorks Gold, which, with eleven integrated modules
and strong reporting tools, was devised to bridge the gap between entry-level
products and MAS 90.
the top of the range, MAS 500 (formerly marketed as Best Enterprise
Suite and before that Acuity Financials) from Best's
Mid-Market Division, is an integrated, SME-focused from ground up, international
ERP package with multicurrency capabilities, targeted at companies above $25
million to $250 million (USD) in annual revenue and with over 200 to 2,500 employees.
It is web-enabled, with browser access to the entire functionality, via Microsoft
Terminal Services, business alerts, and workflow management. The package combines
accounting, budgeting, distribution, manufacturing, project accounting, HR/payroll,
enterprise reporting, and electronic commerce functions, and integrates with
SalesLogix CRM. It features strong financials and project accounting functionality,
and light discrete manufacturing (including a product configurator, engineering
change management [ECM], materials requirement planning [MRP], and advanced
planning and scheduling [APS]). Particularly strong is distribution functionality
with robust inventory replenishment and supply chain visibility capabilities.
More Migration Tools
upcoming product releases promise even more migration tools that facilitate
moving data from the legacy system in place, and in particular tools to move
data from MAS 90 and MAS 200. Moreover, the
product blends its financial and accounting modules with Abra HR/Payroll,
FAS Fixed Asset Management and analytics offerings from Best's
Specialized Business Solutions unit. Also, project accounting, a number of pre-built
integration hooks to popular third-party applications, extensive "drill down"
and "drill around" navigational capabilities, and authentic customization tools
(particularly the intuitive screen customization tool, used by "ordinary", less
IT-oriented users, and with the ability to track or preserve changes for seamless
future product upgrades), represent another set of attractive features.
platforms are Windows NT/2000/XP and Microsoft SQL Server databases.
The product is fairly new though, with slightly over 1,000 installations, but
it has been developed from the ground up for Microsoft SQL Server, and is also
developed in Visual Basic, making the transition to Microsoft
.NET straightforward. The program might be a likely migration path
for ACCPAC Advantage users, albeit only those that are on Microsoft platforms.
concludes Part Five of an eight-part note.
One, Two, and Three presented the Event Summary.
Four began and Part Six will continue the discussion of the Market Impact.
Seven will cover Challenges and Part Eight will make User Recommendations.