SAP Doubles Down on SMEs

SAP’s continues to refine its focus in the SMB space, and with each turn we are seeing their approach improve.

Recent announcements pertaining to 24-month zero % customer financing for reseller driven sales, and partner reimbursement for cloud-based sales are much needed tactical moves.  Businesses acquiring at least €20,000 worth of SAP solutions can take advantage of the 0% financing offer.  Further, partners will be compensated on the full margin of any cloud-related sale up front, instead of having to wait over a period of months and years to recoup their profits.

This will be attractive for small businesses that are hard pressed to qualify for financing in a tougher lending environment, which has been a drag on business investments ever since the 2008 downturn.  The €20,000 minimum will be attractive to businesses willing to make a serious commitment to improve their operational and competitive position.

The partner compensation piece is yet another step in the right direction that will enable partners aggressively evolve towards the cloud, where most of the customer demand is shifting.  Having a cash flow cushion is the number 1 issue channel partners grapple with as they transition from on-prem to cloud software.  And this would even the playing field against NetSuite, which has been plying a similar program.

Mostly though, we are comfortable with SAP’s evolution because it is built on a foundation of strong on-prem solutions, which are now being complemented and cloud-enabled via acquisitions and R&D.  Ultimately, having both on-prem and cloud solutions and capabilities is essential to succeeding in the SME space as it will likely be a hybrid environment for the foreseeable future.

-Deepinder Sahni, SVP