Expert advice
François Lévesque
Technical Director at Witify
Discussing the cost of an ERP system is often one of a manager's first instincts. And that's understandable: an ERP represents a major, structuring, and long-term investment. The problem is that this question is almost always addressed too early, and in the wrong way.
On the market, you see everything: ERPs advertised at $30,000, others at $500,000, some billed monthly, others as one-off projects. Yet, behind these figures lie very different, and rarely comparable, realities.
Disclaimer
Witify is a company specializing in custom software and ERP development. This position inevitably introduces a bias into our market analysis. That said, this article does not seek to promote a single approach. It is based on our concrete observations in ERP projects across Canada: growing SMEs, manufacturing companies, service organizations, successful implementations… and costly failures.
The goal is to provide clarity, not a universal answer.
Before talking about figures, we must first understand what an ERP really costs, and especially why two ERPs advertised at the same price can cost radically different over time.
The question "How much does an ERP cost?" is legitimate, but it is rarely the right question to ask first.
An ERP is neither a website nor a standalone application. It is a centralized system that impacts:
In other words, it does not just support the company: it structures it.
Asking for the price of an ERP without talking about processes, data, volumes or objectives is like asking for the price of a factory without knowing what you want to produce there.
In most cases, the figure presented initially (license or initial quote) represents only a fraction of the actual cost.
What's expensive isn't:
What's expensive is:
A "cheap" ERP can become extremely expensive over 3 to 5 years.
Conversely, a more structured ERP from the outset can drastically reduce operational costs, errors, and internal friction.
On the ground, one constant is observed: the cost of an ERP is directly linked to the level of maturity of the company.
Cost is therefore not a starting point.
This is the result of structural, organizational and strategic choices.
When the primary goal is to minimize the price:
In the following sections, we will break down where the money actually goes in an ERP project , what the real cost categories are, and how to think in terms of total cost rather than entry price.
When discussing the cost of an ERP system, it's essential to understand what's being paid for, when, and why. Most budget overruns don't stem from a poor choice of tool, but rather from a flawed understanding of these cost categories from the outset.
These are the blocks that can be found in virtually all ERP projects, regardless of the solution chosen (cloud, open-source, proprietary or custom).
This is the most visible part… and often the most deceptive.
Depending on the type of ERP:
This cost is easy to compare, but rarely representative of the total cost.
Common trap
An ERP with a low but highly dependent licensing cost:
...can quickly cost much more than expected!
Very often underestimated, even though it is the foundation of the project.
This phase includes:
Insufficient framing does not reduce costs: it shifts them to later, in the form of corrections, workarounds or re-developments.
In practice, it's one of the categories with the best return on investment.
This is where the realities diverge the most.
In both cases, the cost depends primarily on:
Important :
A heavily modified “standard” ERP is not necessarily cheaper than a well-defined, custom-made ERP .
Very often undervalued.
An ERP system never exists in isolation. It must be integrated with:
Each integration has a cost:
The more rigid the ERP system, the more expensive integrations become in the long run.
It's rarely "just an import".
This includes:
An ERP system that is poorly supplied with reliable data does not produce value, regardless of its technical quality.
An ERP that is not adopted is a failed ERP.
The real costs rarely come from the training itself, but from:
Companies that invest here significantly reduce:
It's the cost that we forget... until it becomes critical.
Includes:
An ERP is a living product, not a static project.
This is the only metric that makes sense. The true cost of an ERP is measured over 3 years, 5 years, sometimes 10 years.
Two ERP systems with the same initial cost can have a total cost difference of one to three times as much, depending on:
The cost of an ERP is never a single figure. It is the sum of decisions made at different stages of the project.
In the next section, we will put concrete orders of magnitude on these categories, based on what we observe in ERP projects in Canada, particularly among growing SMEs supported by Witify and other market players.
First and foremost, an essential point: there is no “one” price for ERP, but rather cost ranges linked to very specific contexts.
The figures below are based on what we observe in the Canadian market, mainly among established SMEs (20 to 200 employees), across all sectors.
Cost year 1
Recurring cost
Who does this suit?
Main risk
Cost year 1
Recurring cost
Who does this suit?
Main risk
(standard core + custom modules)
Cost year 1
Recurring cost
Who does this suit?
Cost year 1
Recurring cost
Who does this suit?
Important reality
A custom ERP system is not “more expensive by default”. It becomes expensive when it is poorly designed.
| ERP Type | Initial cost | Cost over 5 years (order of magnitude) |
|---|---|---|
| standard cloud ERP | Down | Medium to high |
| open-source ERP | AVERAGE | AVERAGE |
| Partial custom ERP | Medium to high | Control |
| Complete custom ERP | Pupil | Variable (depending on governance) |
This chart explains why so many executives feel like they are “paying twice” for their ERP.
This is where the most significant differences between ERP projects lie. These costs do not appear in the licenses or the initial quotes.
Parallel Excel entries, double data entry, manual validations, “temporary” procedures that last for years. These are invisible, but extremely high, human costs.
Every compromise accepted too soon:
And ERP debt is much more expensive to repay than classic technical debt .
A poorly implemented ERP system:
The cost is not the software. The cost is the loss of confidence in the tool.
It's paradoxical, but common: wanting to "wait before investing" often costs more than acting.
Every year without a suitable public access building:
The cost of an ERP is never just an isolated figure on a quote. It is a direct reflection of the maturity of the processes, the clarity of the decisions, and the ability of an organization to structure itself over time.
In the Canadian market, we still see too many companies seeking to optimize the entry price, while the real issues lie elsewhere: in the suitability of the tool to operational reality, in the quality of the initial scoping, and in the way the ERP supports growth rather than hindering it.
A well-designed ERP system does more than simply automate existing processes. It stabilizes the organization, ensures data reliability, and creates a foundation upon which decisions become faster and more consistent. Conversely, a poorly aligned ERP system quickly becomes a burden, regardless of its initial cost.
There is no one-size-fits-all solution. Off-the-shelf ERPs, hybrid ERPs, or custom ERPs can all be good choices in the right context. The real risk isn't overinvesting, but investing without a clear vision of what the company is trying to structure, both now and in the future.
If you are considering an ERP, the question to ask yourself is not just how much it costs , but where the real areas of value and risk lie for your organization .
At Witify, we rarely start by talking about solutions or technologies. We start by understanding the processes, constraints, and business objectives, in order to take a clear-eyed look at what is (or is not) relevant to implement.
An exploratory discussion, a diagnosis, or simply a structured exchange often allows for quick clarification:
You can contact us here , without obligation, without forced sales approach, simply to inform the decision.
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François Lévesque
Technical Director at Witify
François Lévesque is co-founder and Technical Director of Witify. Specializing in the management and development of complex software and web projects, he has spent the last 8 years developing customized ERP, Intranets and CRM systems. Throughout his career, he has developed in-depth expertise in software engineering, with a particular sensitivity to translating business objectives into precise technical requirements. With extensive expertise in data analysis and visualization, François has also successfully led numerous data projects with government institutions.
