openerp-community team mailing list archive

[Fabien Pinckaers <fp@xxxxxxxxxxx>]

On 05/19/2014 02:54 PM, TeMPO Consulting wrote:
> Hello Fabien
> 
> after attending two webminars and reading all the mail related to
> pricing I still have two major questions
> 
>  1. are the prices listed at https://www.odoo.com/page/pricing related
>     to the SaaS offer or to Odoo Enterprise, or both ?

Both. We want to keep the same price/contract in order to not create
pricing competition between both. It also allows people to switch from
saas to on-premise without having to change their contracts.

>  2. if they also apply to Odoo Enterprise what is the SLA provided by
>     the "Community Support" ?

What do you mean by community support?


> 
> many thanks for your reply.
> 
> Maurice MORETTI
> 
>>> Basic math for a client with 20 users and 5 apps for 24 months:
>>>   * 20 users x 5 apps x 24 months x $15 = $36,000
>>>   * Partner commission for 24 months (~50%)= $18,000
>> No, this is a common usecase:
>>
>> Here is a typical use case (with old pricing), 40 users:
>>   - Public Price: $18720
>>   - Partner Price: $9360 (a ready partner)
>>   - Price sold to customer: $13.000
>>   - Implementation Cost:    $90.000
>>
>> Maintenance part of the TCO: 12.6%
>> Commission  part of the TCO:  3.5%
>>
>>
>>
>>> On Sun, May 18, 2014 at 11:47 AM, Fabien Pinckaers <fp@xxxxxxxxxxx
>>> <mailto:fp@xxxxxxxxxxx>> wrote:
>>>
>>>     Hi,
>>>
>>>     I just wrote a blog to explain the new pricing:
>>>         https://www.odoo.com/blog/1/post/158
>>>
>>>     Please read it before going further in this email.
>>>
>>>
>>>     I'll try to answer most questions here:
>>>
>>>     1/ How to compute the price?
>>>
>>>     The price is: # total of users X # of apps bundle X 12€
>>>
>>>     2/ Why don't we charge according to real usage? (e.g.: 5 users on CRM, 3
>>>     on accounting, 7 on projects?)
>>>
>>>     Because it's impossible to predict for yearly contracts! Quoting would
>>>     become a nightmare and a lot of people would abuse from this unclear
>>>     situation. (a customer would start with a low price but three month
>>>     after we would have to upsell him because of the number of users on some
>>>     apps)
>>>
>>>     Lets take the following use case: a company of 10 users that uses CRM,
>>>     accounting, projects. They have 3 sales person, 4 consultants, 1
>>>     director, 1 secretary and 1 accountant.
>>>
>>>     When you do a quote for this customer, how many users do they have per
>>>     application?
>>>       - is the director using accounting and CRM?
>>>       - can the sales have read access to project for follow-ups to their
>>>         customers?
>>>       - can the accounting check sales orders coming from the sales?
>>>       - is it the secreatary that give access rights to others users?
>>>
>>>     I checked in our production database. We have 7 persons working in the
>>>     marketing department. If one do a quote of 7 users for the marketing
>>>     application bundle, it's totally under-estimated.
>>>
>>>     In reality, we have 45 users on marketing application, not 7:
>>>       - the Professional Service team that built the certification sample
>>>         exam on the website (survey)
>>>       - users that train others users on features
>>>       - managers that need statistics about events, mass mailing, ...
>>>       - most sales need an access to check prospects on events,
>>>       - system administrator need an access to allocate access rights and
>>>         test for others users
>>>
>>>     3/ Is it expensive?
>>>
>>>     Absolutly not. It's 2x to 3x cheaper than the market average. Check this
>>>     comparison of software vendors:
>>>       https://www.odoo.com/website/image/ir.attachment/537400/datas
>>>
>>>     Moreover, partners get 50% to 60% discount on the public price. It means
>>>     gold partners pay only 4.8€ / $6 per user and per application. Whatever
>>>     the market, it's super cheap and super competitive.
>>>
>>>
>>>     4/ Is it an increase of the price?
>>>
>>>     For some customers: no. (1-3 apps)
>>>     For some customers: yes.
>>>
>>>     The biggest increase would be around 2x more for one particular customer
>>>     that uses a lot of applications. (6) I never saw a company running 10
>>>     apps and if they do, it's normal that they pay 120€ per user because the
>>>     value they get from Odoo is huge. No other product can offer this.
>>>
>>>
>>>     5/ localization & customization
>>>
>>>     Odoo has a lot of huge advantages compared to traditional ERPs:
>>>       - higher scope: website, ecommerce, cubes analysis, CRM, ...
>>>       - better usability, faster implementation
>>>       - better flexibility: allows custom development and high level config
>>>
>>>     Odoo also has a few disadvantages compared to traditional ERPs, the main
>>>     one is the localization in some countries. (something we will fix for v9
>>>     as we will massively invest in accounting l18n)
>>>
>>>     Odoo has a lot of PROS and a few CONs. But the few CONs are largely
>>>     compensated by the PROs. As the product is better, economics tell us
>>>     that the product must be more expensive.
>>>
>>>     Not only we are not more expensive, but we are at least 2x to 3x
>>>     cheaper. And, if you take the partner price 4.8€ per user and per app,
>>>     we are 6x cheaper than the competition!
>>>
>>>     I do not know a lot of industry where a product can be 2X cheaper for a
>>>     better quality.
>>>
>>>     One should not be frustrated about the price.
>>>
>>>     @marcelo
>>>     > I recently read the posts by the Compiere founder explaining what
>>>     > went wrong after he got VC money. Read it and it will look like it is
>>>     > all happening again.
>>>     Every time we do a change in the community people cry: take care of
>>>     forks, read Jorge's blog, VCs are evil, OpenERP does not understand its
>>>     users...
>>>
>>>     Odoo is not comparable to Compiere/Tryton/Openbravo or others. The
>>>     sustainability of a product is not related at all with fork threats,
>>>     failure of others open source software or what ever.
>>>
>>>     The sustainability of every product is directly linked to it's ability
>>>     to create a sustainable model where partners and publishers get enough
>>>     revenues to grow their activities on the product.
>>>
>>>     This requires a lot of things like: having a great product allowing good
>>>     service margins, a good price for the publisher, happy customers, etc.
>>>
>>>     >      What kind of business puts potential clients in front of active
>>>     > paying clients? The model is wrong wrong wrong.
>>>
>>>     What's wrong is to have a pricing so cheap that it does not allow to
>>>     sustain the development of the product, or too few customers because the
>>>     product is not competitive. That's what killed some products.
>>>
>>>     >       If Odoo was a ready-to-use software then the model would make a
>>>     > lot of sense. But they are ignoring the importance of localization &
>>>     > customization. If I wanted off the shelf software I wouldn't bother
>>>     > going open source.
>>>
>>>     Our customers don't choose Odoo beause it's open source. They choose
>>>     Odoo because it's better (products and/or servives of partners)
>>>
>>>     We should stop being frustrated of being open source. It's not because
>>>     we are open source that we should be cheaper. The only thing that
>>>     matters for a customer is to have a great product at an affordable
>>>     price.
>>>
>>>     Open Source is not a customer value, it's a way to develop better
>>>     products.
>>>
>>>
>>>     >             Also, this thing that partners will not get any commission
>>>     >         on contracts with more than two years is REALLY nonsense. It
>>>     >         essentially means that the contract will become 50% more
>>>     >         expensive on the 3rd year because the partner will need that
>>>     >         revenue back and of course it will be important for the client
>>>     >         to keep bonds with the partner. It is really sad when
>>>     companies
>>>     >         pull this sort of crap on their "partners".
>>>
>>>     My understanding is that partners don't sell Odoo Enterprise because of
>>>     their commissions. They sell it because they need it for their customers
>>>     and because this allows them to sell more services. (and this is how it
>>>     should be)
>>>
>>>     The part of the commission on Odoo Enterprise is usually lower than 4%
>>>     of the revenue a partner take on a project. So, their motivation is not
>>>     on the commission.
>>>
>>>     I may be wrong. I am open to discuss this during the community days.
>>>
>>>
>>>
>>>     Hope it helps better understanding this strategic move,
>>>     Thanks for the feedback,
>>>
>>>     --
>>>     Fabien Pinckaers
>>>     Odoo Founder
>>>
>>>     Phone: +32.81.81.37.00 <tel:%2B32.81.81.37.00>
>>>     Web: https://www.odoo.com
>>>     Twitter: @fpopenerp
>>>
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>>>
>>>
>>
> 
> 
> -- 
> Très cordialement
> 
> Maurice MORETTI
> 
> _________________________________________________________________________
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-- 
Fabien Pinckaers
Odoo Founder

Phone: +32.81.81.37.00
Web: https://www.odoo.com
Twitter: @fpodoo