Business Central: Cloud vs. On-Premises – Kosten und Lizenzen im Vergleich

How much does your ERP really cost? Compare Business Central in the cloud with on-premises versions to find out where you can save money and which licenses your team needs.

• Dynamics 365 Business Central SaaS: You pay a monthly subscription fee per user. If your team grows or your needs change, you can adjust the number of licenses within the terms of your agreement. There is no need for a large upfront investment in perpetual licenses. If you’re migrating from Dynamics NAV or Business Central On-Premises, you may also be eligible for Microsoft incentive programs such as “Bridge to the Cloud.” Whether your company can benefit from these depends on the applicable terms and conditions.
• Dynamics NAV/Business Central On-Premises: With the traditional purchase model, you acquire the licenses up front. This requires a larger initial investment. In addition, there are annual fees for the maintenance plan, known as the “Enhancement Plan” (EP). Among other things, this plan ensures your access to new versions; their implementation and additional support services may incur further costs.

• Dynamics 365 Business Central SaaS: Purchasing your own ERP servers, expanding storage, replacing hardware—with the SaaS model, Microsoft handles these tasks for you. Business Central runs on the Microsoft Azure platform. This eliminates the need to invest in your own server infrastructure for your ERP system, including the associated operating system and database licenses. Your teams will still need suitable devices and a reliable internet connection.
• Dynamics NAV/Business Central On-Premises: When operating on-premises, you are responsible for the technical infrastructure yourself: servers, operating systems, databases, and backup solutions must be purchased and kept up and running. On top of that, there are ongoing expenses for electricity, cooling, and server space. You should also plan for replacement purchases—after all, no hardware lasts forever.

• Dynamics 365 Business Central SaaS: Is the next update coming up? Microsoft handles the technical deployment and regularly updates Business Central Online. This largely eliminates maintenance and upgrade costs. As a result, your IT team has to spend less time managing day-to-day system operations and gains time for other tasks. However, even in the cloud, it’s not entirely effortless: extensions and interfaces must be checked for compatibility, and new features may need to be tested. This may still result in internal effort and costs for your service partner.
• Dynamics NAV/Business Central On-Premises: Maintenance, security patches, and major version upgrades are your responsibility. Your IT team must plan and carry out this work, often in collaboration with external consultants. Upgrades can be particularly time-consuming and costly, especially for heavily customized systems. In addition, you need to consider support deadlines: If the manufacturer’s support for your version is about to expire, you should have prepared for the transition well in advance.

• Dynamics 365 Business Central SaaS: How much will your ERP system cost over several years? The monthly subscription fee is just one part of the equation. Savings on in-house server infrastructure and technical operations, as well as the reduced workload on your IT team, can lower your total cost of ownership. However, for a realistic comparison, migration, enhancements, and ongoing support must also be included in the calculation. COSMO CONSULT supports you with upgrade services to help you plan the transition and keep track of the costs.
• Dynamics NAV/Business Central On-Premises: The licenses are paid for, the servers are running—but that’s not the end of the story. Maintenance, upgrades, and qualified IT staff incur ongoing costs. Added to this are the depreciation of your hardware and future replacement purchases. Over several years, these expenses can add up significantly. Therefore, only a comparison of all relevant costs over the same period will reveal whether on-premises operation or SaaS is more cost-effective for your company.

People who work with Business Central every day need different features than those who occasionally look up data or approve transactions. With the right SaaS licenses, you can give your team the capabilities they need while keeping your costs under control. The key factor is who performs which tasks in the system.

From day-to-day financial accounting to a shared warehouse terminal: Dynamics 365 Business Central SaaS offers various license types for different tasks and workstations:

• "Premium User" license: Provides full access to all Dynamics 365 Business Central modules, including advanced production and service management features. It is ideal for companies with complex production or service processes.
• "Essentials User" license: Covers the basic functions of an ERP system, such as financial management, sales, purchasing, inventory, and project management. It is suitable for most small and medium-sized businesses.
• "Device" License: If multiple employees use the same device—such as a warehouse terminal—a device license may be appropriate. It allows access via that device for specific tasks.
• "Team Member" License: Users who primarily look up information and perform selected tasks—such as specific approvals or time tracking—may not need the full range of features. The "Team Member" license provides limited read and edit permissions for these purposes. The key factors are the required functions and the applicable license terms.

Do you need production planning, or do you need to manage service orders and maintenance contracts? If so, the Premium license is worth considering: It includes all the features of Essentials and adds production and service management.

For most basic business processes, the Essentials license is sufficient. It covers financial management, sales, purchasing, inventory, and project management. The key factor is which business processes you want to map in Business Central. If you need the integrated functions for production or service management, the Premium license is required.

How much does your ERP system really cost—and where could you put your budget to better use? Switching to Dynamics 365 Business Central SaaS offers the opportunity to plan costs more effectively, reduce the workload on your IT team, and regularly benefit from new features. To determine whether the cloud is a good fit for your business, take a look at the total cost of ownership (TCO) and the right licenses for your team.

Once you understand your cost structure and functional requirements, you can plan the transition strategically. This way, you’ll create a solution that fits your day-to-day operations and can grow with your business.